FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
About The New Chum Small Business Loans
Tell me more about New Chum Small Business Loans
New Chum unsecured loans provides amounts between $5,000 and $100,000. Terms range from 3 and 24 months and cash flow-friendly repayments which can be made daily or weekly.
What is the Unsecured Loan different from a traditional business loan?
It is imaginable to apply for this Small Business Loan in under 10 minutes over the phone. You’ll get an instant response and the funds could be on your account within 24 hours. Traditional business loans reference an annual rate of interest as well as other fees and charges. This business loan is an upfront priced loan which means you know in advance the total amount due, which includes the interest, fees and charges. Then, it is broken down into either weekly or daily installment amount.
What can you use the Small Business Loan be used for?
The Small Business Loan can be used for virtually any business purpose including control of cash flow company remodeling, marketing to purchase inventory, new equipment, for general working capital, and much more. The loan cannot be used to fund personal expenses.
About the Larger New Chum Business Loans
What is the Larger New Chum Business Loan?
The Larger Business Loan is a larger size loan to aid in company expansion opportunities. Loans range from $100,000 to $500,000 for a fixed period of up to 36 months. The repayments are made weekly or fortnightly in order to accommodate the flow of cash.
How is the Origination Fee determined?
A Larger Business Loan has an Origination Fee, which is calculated at 2.5 percentage of the loan amount.
Do I qualify for the Larger Business Loan?
To be eligible for a loan in this amount the business needs to have been operating for a minimum of 3 years and have an annual turnover of $700K. You must be a New Zealand Citizen (or Permanent Resident) over 18 years and have a New Zealand company (with a valid NZBN/IRD) and be able demonstrate at least 12 months of trading.
What can the funding be used for?
A larger business loan is a great option for almost any business reason, such as business renovations, to purchase inventory or new equipment for general working capital and so much more. The loan cannot be used for personal use.
Is the Larger Business Loan one that is secured?
Asset security is needed for accessing funds over $150,000. It’s as a result of an charge against assets and can include registration through the PPSR or making as a caveat.
A director’s or personal ensure is a promise to pay off a credit line that is general in nature rather than stipulating security over an asset. The person signing the guarantee is personally liable in the event that the company the borrower fails to re-pay the debt.
The Personal Property Securities Register (PPSR) is an online, central register operated by the New Zealand Government. It lists security interests that are granted to individuals who own personal property (including goods or assets). The PPSR allows priority over personal property to be assigned in accordance with the date on which a security interest was registered.
A caveat is a legal document that is filed to offer the legal claim to a property.
What is a pre-approval without Credit Check?
If you’re seeking the Larger Business Loan of $250K or more it’s possible to offer an initial pre-approval to ease the process. We might be able to get this done without a credit check and within 6 hours of the initial application. The pre-approval is based upon an initial evaluation that involves answering a couple of financial health checks. It’s in no way an offer, nor is it a guarantee of finance. Acceptance without condition is subject to a full credit assessment and any offer that you may receive may be on different conditions.
The application process
Do I have the right to receive funds?
You are eligible to apply for an business loan if you
- are a New Zealand Citizen (or Permanent Resident)
- are over the age of 18 and own a New Zealand business (with a valid NZBN/IRD)
- can demonstrate at least 6 months worth of trade (for the unsecured loan $5K – $100K) or three years of trading (for the Larger Business Loan $100K up to $500K)
How do I apply?
The process for applying is fast and simple. Complete the online form in few minutes and an experienced company credit specialist will contact you to assist you.
To apply for up $100,000, you’ll require the right identification documents (valid Driver’s License) along with a valid NZBN/IRD and at least 6 months’ worth of bank statements.
In addition, for larger loan sizes, you’ll require:
$100K – $250K: Application details including credit consent, 6 – 12 months of bank statements, IRD statement (if credit is over $150K).
$250K-$500K: Details of the application, including credit consent and 12 months of bank records, IRD statements, last 2 years finalised financial statements, in addition to interim current financial year financials such as age-related payables and aged Receivables Summary.
How quickly will I receive an answer?
For an unsecured loan ($5K to $100K) we can often provide a response in one hour – as long as you submit your request within standard company hours and permit us to use the advanced bank verification system to instantly verify your bank details online. If you decide to upload copies of your banking statements , we are able to offer an answer within the span of one company day.
If you are applying for a Larger Business Loan ($100K up to $500,000) we may be in a position to provide you with a conditional pre-approval within about six hours. After you’ve signed your pre-approval document, you will need to wait approximately 2-3 days to receive final approval. However, this may be quicker depending on the particular circumstances of each application. Certain agreements have been approved within just 24 hours.
The fastest way would be to make sure you apply during standard company hours and allow us to use our advance bank verification link to verify your bank account information online. If you upload the copies of bank statements , it will take a little longer.
How fast will I get the money?
For the Small Business Loan ($5K or more) we typically provide an answer in just one hour – as long as you apply within standard business times and let us use the advanced bank verification system link to instantly verify your bank information online. If you choose to send us copies of your bank statements we can offer the decision in as little as one business day.
For Larger Business Loans ($100K to $500K) we could be capable of provide you with conditional pre-approval within 6 hours. After you’ve signed the pre-approval form, it will take between 2 and 3 days for the final approval. However, this could be shorter based on the circumstances of each application. Some offers have been approved in the space of 24 hours.
The most effective method for you to apply is make sure you apply during standard business hours. You can also allow us to use the sophisticated bank verification link to instantly verify your bank information online. If you decide to send us the copies of bank statement, it may take a bit longer.
How much can I borrow?
We provide loan amounts between $5,000 and $500,000. When you submit an application for a particular amount, we take into consideration a range of factors in order to assess the well-being that is your company as well as the amount of repayments that your company will be able to support. The total amount of the loan will be determined by the particular circumstances that are unique to your company.
When you submit an application for a specific amount we will consider a number of variables to determine your well-being that is your company as well as the amount of repayments your company can support. The total amount of your loan will depend on the specific circumstances the company.
Fees & repayments
How do you charge for an business loan?
If you decide to apply for our business loan, we’ll assess the risk profile the company and provide an individualised offer that includes the amount of loan, the term and the interest rates. This business loan is an upfront cost loan therefore you will know in advance the total amount to be paid, including any charges or interest.
What determines the amount I am charged?
The interest rates on company loans rates vary due to factors including the amount borrowed, the company assets the funds are used to purchase in addition to the industry that the business operates in, the long the company has been running, in the event that the company has enough cash flow to cover the loan, and also the overall well-being and creditworthiness of the business.
What are the costs?
There are no hidden fees with our business loans, and you’ll be aware of the amount you’ll be required to pay, and when, starting from day one. There’s no compounding and the loan comes with no additional fees (as long as you make your payments punctually).
We don’t charge an Application Fee. You are able to request a credit loan with without any upfront costs or commitment to apply.
The Origination Fee includes the expenses associated with setting up and managing the loan. This is only a fee if you decide to take the loan. The Origination Fee for us is 2.5 percentage of the amount of loan.
Can I pay out the loan in advance?
You may choose to pay back all of your loan early at any time.
If you decide to do this please call our helpful business lending specialists. They’ll provide you with the details of your repayment and an early payment figure. It will be calculated using the total of the principal remaining and accrued interest to the time of early payment, plus 1.5% of the remaining principal as well as any outstanding fees.
What is the process for repayments?
In order to help you avoid missing payment dates and to align with your cash flow routine, we provide payments that are either weekly or daily. They are automatically deducted from your designated business account.
Security & privacy
Will my data be protected?
Security of your data, and being clear about the ways we gather data, process, exchange and secure your information, is of huge importance and an integral element of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We utilise industry-recognised encryption standards to protect your personal, sensitive financial and other data. Our funders are ISO 27001 qualified for our commitment to protecting the security of customers and privacy. We use an advanced banking verification system to immediately verify the bank account details online. This allows us to provide rapid response.
About business loans
What exactly is an asset-based loan (a secured loan)?
An asset-based loan is when an company owner uses an asset they own to get a loan. The asset may be a personal asset like the family home, or a company asset like a truck or piece or equipment.
The majority of banks, including the major banks, prefer to make loans secured by an asset. If you are having difficulty paying back the loan, then your asset may be sold by the lender. In essence it is the process of securing new financing by using the worth of the asset you already have.
Do I need security to get a business loan?
Up to $150,000 in loans it is not necessary to secure assets prior to the loan’s access, however we require a personal guarantee. need the personal guarantee. In the event that you fulfill your loan obligations (as stated in the loan contract) and you are able to meet your obligations, asset security is not needed. If you take out loans in excess of $150K generally, you can get personal ensure and security in the form a charge over assets.