In times of uncertainty we often get asked is we can help arrange a small business loan.
Of course, at times like this when the finance is needed the banks can make getting a business loan quite difficult.
They will give you money when business is good and you don’t need it, but when times get a bit tough the banks will often run for cover.
Are You Looking For A Small Business Loan Now?
The best plan is to apply for finance before you need it; however the reality is you only think about getting a loan when cashflow is a little tight.
It does depend what the finance is needed for.
You may need extra money to fund your business cashflow, to help grow your business, to fund growth that you have tried to do from cashflow, to refinance or consolidate some other debt or to pay outstanding credit cards or pay overdue tax.
There are a number of reasons that you may want finance, and also a number of options for the finance.
Getting The Best Business Loan
As finance brokers we try to find the most appropriate lending for your situation.
These loans may be secured by a property with either a first mortgage, a second mortgage or a caveat loan.
Or you might want or need an unsecured loan.
Often the banks will be looking for property as security, so while they may call it a small business loan in fact it is really secured to your home (or other property) with the mortgage. This can be the most affordable option but you do need to ensure that you are getting home loan rates not business rates. A bank will normally try to charge the higher business lending rates if they know the purpose of the lending is for the business. Your finance broker might be able to structure bank lending so you do get the lower interest rates.
There are also some banks and other non bank specialist lenders that can offer business loans that are not secured by property. They are generally a little more expensive than a home loan, but can be less expensive than a business overdraft.
As finance brokers we do have a range of lenders that will provide a small business loan with secondary security over your property. This means that you can leave your existing home loan in place as the first mortgage and have the business loan secured with a second mortgage or a caveat.
Over the past few years we have also seen a number of other lenders enter the New Zealand market that focus on providing short-term small business loans. These can be more expensive but can also be a good option for those times that you need finance to fund a project, a job or a short-term requirement.
The key is speaking to the right finance broker who has the range of options.
