Offer of Credit
A quick overview
An offer of credit is a formal document from a lender confirming they’ve approved your loan and outlining the terms and conditions.
An offer of credit means you’ve made it through the application process and the lender is ready to move forward (i.e you’re approved and ready to go). It’s the official green light that says your business loan is approved, with all the details laid out for you to review. In this article, we’ll explain what an offer of credit includes, how to read it properly, and what happens next.
What exactly is an offer of credit?
An offer of credit is a formal loan approval document provided by a lender. It confirms that your finance application has been assessed and approved. The document outlines the loan amount, interest rate, term, fees, repayment structure, and any conditions you need to meet.
You’ll usually receive this offer after your application has been reviewed and your documents have been verified.
Once you sign and return it, the lender can move to settlement and release the funds.
It’s not a quote or estimate, it’s the real deal. Once signed, it becomes legally binding.
Your broker will be able to help you read, understand, and make sure you’re comfortable with everything it contains.
In the context of asset finance in Australia
In Australian asset finance, an offer of credit is common once a lender is satisfied with your documents and credit assessment. It often comes after a broker has packaged the deal and received verbal or email approval from the lender. The formal offer sets out all the key loan terms, including any residual value or balloon payment, fees, and asset description. Once you accept and sign the offer, the lender moves into settlement. If you’re unsure about any terms or conditions, this is your final chance to ask questions or push back. A good broker will walk you through every section before you sign.
A landscaping business in brisbane applies for a $70,000 secured loan to buy a new truck and trailer setup. After submitting financials and confirming asset details, the lender issues an offer of credit. It confirms the loan amount, repayment structure, interest rate, fees, and a 15 percent balloon at the end. The broker reviews the document with the client, they sign it, and the funds are released two days later.