FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the Londonderry Small Business Loans
Tell me more about Londonderry Small Business Loans
Londonderry unsecured loans offers amounts between $5,000 and $100,000, with terms ranging from 3 and 24 months. They also offer cash flow friendly repayments which can be made daily or weekly.
What is the Unsecured Loan different from the traditional business loan?
Apply to your Small Business Loan in under 10 minutes on the internet or over the phone. You’ll get an immediate response, and the money could be available in just 24 hours. Traditional business loans refer to an annual rate of interest together with additional fees and charges. The business loan is a cash-based loan which means you know in advance the total amount to be paid, including any fees, charges or charges. Then, it is broken down into either weekly or daily installment amount.
What can be the Small Business Loan be used for?
The Small Business Loan can be used to fulfill almost any business need, such as cash flow management, company improvements, advertising to purchase inventory, new equipment, or as general working capital, and much more. The loan is not available for personal use.
About Larger Londonderry Business Loans
What is the Larger Londonderry Business Loan?
The Larger Business Loan is a larger size of loan that can be used to fund company expansion opportunities. Loans range between $100,000 and $500,000 with a term fixed up to 36 months. Repayments are weekly or fortnightly depending on you cashflow.
How is the Origination Fee calculated?
The Larger Business Loan has an Origination Fee, which is calculated at 2.5 percentage of the loan amount.
Am I eligible for the Larger Business Loan?
To be eligible for a credit that is this large the company needs to have been trading for at least 3 years and have an annual turnover of at least $700,000. You must be a New Zealand Citizen (or Permanent Resident) who is over the age of 18 or have a New Zealand company (with a valid NZBN/IRD) and be able to prove at the least 12 months of operating.
What can I use the funds for?
A Business Loan of a larger size can be used to fund almost all business use, including business renovations, purchase of new equipment or inventory for general working capital, and much more. The loan cannot be used to fund personal expenses.
Is the Larger Business Loan a secured loan?
Asset security is necessary to obtain funding above $150,000. This can be done by way of charge against assets, and could be registered on the PPSR or making as a caveat.
A director’s or personal guarantee is a guarantee to pay back a loan that is general in nature, rather than stipulating security over an asset. The person who signs the guarantee is personally liable in the event that the business borrower is unable to pay back the debt.
The Personal Property Securities Register (PPSR) is a central, national online register run by the New Zealand Government. It reflects security interests registered in respect of personal property (including items or assets). The PPSR permits preference over private property assigned according to the date a registration of a security interest.
Caveats are legal document filed to provide the public notice of a legal claim against a property.
What is a pre-approval that does not require Credit Check?
If you’re applying for the Larger Business Loan of $250,000 or more we may be able to provide an initial pre-approval in order to make the process. We might be able to do this without a credit check, and within six hours of your initial application. The pre-approval process is based on a preliminary assessment which includes the answer to a series of financial health questions. It is not an offer or guarantee of finance. The approval of a conditional loan is subject to a full credit assessment and any offer that you are offered could be subject to different terms.
The application process
Can I be eligible for funding?
You are eligible to apply for an business loan if you;
- are a New Zealand Citizen (or Permanent Resident)
- are at least 18 years old, own a New Zealand business (with a valid NZBN/IRD)
- must show at least six months of business (for for the unsecured loan $5K – $100K) or three years of trading (for the Larger Business Loan $100K or $500K)
How do I apply?
The application process is simple and simple. Complete the online form in just a few minutes, and an experienced business loan specialist will be in touch to guide you through the process.
To be eligible for up to $100,000, you’ll need identification details (valid Driver’s Licence) and a valid NZBN/IRD as well as at least six months of bank statements.
For larger loan sizes, you’ll also require:
$100K – $250K: Application details including credit approval, 6-12 months of IRD statements, bank statements (if the loan is greater than $150K).
$250K to $500K: Application details including credit consent twelve month bank accounts, the IRD statements, last 2 years finalised financial statements, in addition to interim financial statements for the current year, Aged Payables and Aged Receivables summaries.
How fast will I get a decision?
For an unsecured loan ($5K or more) we typically provide an answer within one hour – as long as you make your application during quality business times and permit us to utilise the bank verification system to instantly verify your bank details online. If you opt to upload copies of your bank statements we can offer the decision in just the span of one business day.
For Larger Business Loans ($100K up to $500,000) we may be able to offer the conditional pre-approval in around six hours. After you’ve signed your pre-approval form, it will take between 2 and 3 days for the final approval, however it could be faster based upon the circumstances for each application. Some agreements have been approved in less than 24 hours.
The fastest way is to ensure you apply during standard business hours. You can also let us use the modern bank verification to verify your bank account information online. If you opt to send us documents from your account statements , it will take a little longer.
How fast will I get the funds?
For the Small Business Loan ($5K to $100K) we can often offer an answer in just one hour, provided you apply during normal business times and allow us to utilise the advanced bank verification system link to instantly verify your bank details online. If you decide to upload copies of your banking statements we can offer a decision in just one business day.
If you are applying for Larger Business Loans ($100K up to $500,000) we might be likely to provide you with pre-approval conditional to your application within about 6 hours. Once you have signed the pre-approval, the turnaround time is around 2-3 days for final approval. However, this can be faster depending on the specifics of each application. Certain agreements have been approved within less than 24 hours.
The fastest way can be make sure you apply during normal business hours and permit us to use the modern bank verification link to instantly verify your bank information online. If you upload duplicates of your banking statements it can take a bit longer.
What’s the minimum amount I can borrow?
We offer the loan amount between $5,000 and $500,000. When you submit an application for a certain amount we will consider a number of elements in order to assess what is the health for your company and the level of repayments your company can afford. The total amount of your loan will be contingent on the particular circumstances that are unique to your company.
When you apply for a specific amount we take into consideration a variety of factors to assess your health of your business and the amount of payments your company will be able to support. The amount you receive from the loan will be determined by the particular circumstances that are unique to your business.
Fees & repayments
How much do you charge for an company loan?
When you apply for business loans with us company financing, we will assess the risk profile that you have for your business and provide you with a customised offer including loan amount, term and interest rates. This business loan is an upfront cost loan therefore you will be aware in advance of the total amount to be paid, including any charges or interest.
What is the basis for the rate I am charged?
Business loan interest rates vary due to factors including the amount of money borrowed, the company assets the funds will be used for, the industry the business is in, how long the company has been running and what percentage of the company has sufficient cash flow to support the loan, and the general well-being or financial standing of the company.
What are the fees?
There are no hidden costs for our company loans, and you’ll know precisely what you’ll need to pay and when, starting from the day you sign up. There’s no compounding interest and the loan comes with no additional fees (as long as you are able to make your payments on time).
We do not charge an application fee. You can make an application for loans with no cost upfront or obligation to proceed.
The Origination Fee includes the expenses associated with setting up and managing the loan. It is only charged for this cost if you take out the loan. Our Origination Fee is 2.5 percentage of the amount of loan.
Can I pay out the loan earlier?
You can choose to repay all of your loan at any point in time.
If you do decide to pursue this option, please call our helpful company credit professionals. We will provide you with details on repayment as well as an early payout amount. This will be calculated as the total of the principal amount remaining and any accrued interest at the time of early payment and 1.5% of the principal balance and any outstanding fees.
How do repayments work?
To help you avoid missing due dates and also to be in line your cash flow cycle we offer repayments that are either weekly or daily. They will be automatically deducted from your company account.
Security & privacy
Will my information be secure?
Security of your data, and being upfront about how we collect data, process, exchange and secure your information, is vital and is an essential part of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We use industry recognised encryption standards to protect your sensitive, personal as well as financial data. Our funders are ISO 27001 certified for our commitment to customer security and security. We use an advanced bank verification system that allows you to immediately confirm your bank account information online so we can offer a fast response.
About business loans
What exactly is an asset-based loan (a secured loan)?
Asset-based borrowing is when the company owner borrows from the assets they have to make the loan. The asset can be an individual property, such as the family home, or an company property like a truck as well as a piece of machine.
The vast majority of banks, including the big banks, tend to guarantee loans against an asset. If you’re struggling to pay back the loan, then the asset could be sold by the lender. In essence, it is the process of securing new financing by using the worth of the asset you already own.
What do I need security for an business loan?
For loans that exceed $150K, the requirement for asset security is not required before you are able to access the money but we require a personal guarantee. need a personal guarantee. So long as you comply with your loan obligations (as stated in your loan contract document) Asset security will never be required. For loans of over $150K generally, you are able to get the option of a personal ensure and security that is in the form a charge over assets.