Residual Stock Loans
Release equity from completed unsold units
A residual stock loan is finance secured against completed, unsold units in a development. Rather than discounting to sell, a residual stock facility repays your construction loan and gives you time to sell at full price.
Key Terms
- LVR: Up to 65% of completed unit value
- Term: 12–24 months
- Security: First mortgage over unsold units
- Repayments: Interest only (capitalised or serviced)
When to use a residual stock loan
If your construction facility is due to expire and you have unsold stock, a residual stock loan repays the construction lender and buys you selling time without forcing a distressed sale. The proceeds from each settlement reduce the loan.
Best Suited To
- Developers at completion with unsold units and a maturing construction loan
- Projects in markets where time to sell is longer than expected
- Sponsors who want to hold rather than discount to clear stock quickly
Residual stock finance releases equity from completed, unsold units — repay your construction facility and hold stock rather than discounting to sell.
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