FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the The Gap Small Business Loans
Tell me more about The Gap Small Business Loans
The Gap unsecured loans provides the range of $5,000 to $100,000. The terms range between 3 and 24 months and cash flow-friendly repayments, which are either daily or weekly.
How is this Unsecured Loan different from an ordinary company loan?
Apply to get this Small Business Loan in under 10 minutes over the phone, receive an instant response and funds may be in your account in 24 hours. Traditional company loans reference an interest rate per annum plus other fees and charges. The business loan is a cash-based loan so you will know ahead of time the total amount due, which includes any interest, fees or charges. Then, it is divided into a daily or weekly amount to be paid back.
What can the Small Business Loan be used for?
A Small Business Loan can be used for almost any company purpose including control of cash flow business remodeling, marketing for purchasing inventory or new equipment, as general working capital and much more. The loan cannot be used to fund personal expenses.
About Larger The Gap Business Loans
What is the Larger The Gap Business Loan?
The Larger Business Loan is a larger amount of loan to help company expansion opportunities. Loans are between $100,000 and $500,000 with a fixed-term that can last up to 36 months. The repayments are made weekly or fortnightly to work with the flow of cash.
How’s the Origination Fee calculated?
A Larger Business Loan has an Origination Fee, determined at 2.5 percentage of the amount of the loan.
Am I eligible for the Larger Business Loan?
In order to be eligible for a loan in this amount, your company needs to be operating for at least three years, and have an annual income of at least $700,000. It is necessary to be a New Zealand Citizen (or Permanent Resident) at least 18 years old as well as own a New Zealand company (with a valid NZBN/IRD) and be able to prove at minimum 12 months of continuous trading.
What can I use the funds for?
A large business loan can be used for nearly every company need, including company renovations, to purchase equipment or inventory as well as for general working capital and so much more. The loan is not available for personal purposes.
Is the Larger Business Loan one that requires security?
Asset security is required to obtain funding above $150,000. It is usually by way of charge on assets, and could include registering this with the PPSR or filing as a caveat.
A personal or director’s guarantee is a promise to repay a loan which is generally based rather than stating the security of a specific asset. The person signing the ensure is personally liable if the company the borrower fails to repay the debt.
The Personal Property Securities Register (PPSR) is an online, central register operated by the New Zealand Government. It contains security interests which are registered with respect to personal property (including goods or assets). The PPSR gives the priority of personal property assigned in accordance with the date on which a security interest was registered.
An affidavit is an official document filed to offer the legal claim to a property.
What exactly is a preapproval without Credit Check?
If you’re seeking a Larger Business Loan of more than $250,000 it is possible to offer an initial pre-approval that will help smooth out the process. We might be able to do this without credit checks and within 6 hours of your initial application. This pre-approval is made based on an initial assessment that includes you answering a few financial health checks. This is neither an offer nor a guarantee of financing. Unconditional approval is subject to an assessment of your creditworthiness and any offer that you might receive could be based on different terms.
The application process
Do I have the right to receive funds?
You are eligible to apply for a business loan if you:
- are a New Zealand Citizen (or Permanent Resident)
- are 18 years or older, have a New Zealand company (with a valid NZBN/IRD)
- must show at least six months of business (for a 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 easy. Complete the online form in few minutes and a dedicated business loan specialist will contact you to assist you.
To be eligible for up to $100,000, you’ll need proof of identity (valid Driver’s Licence) along with a valid NZBN/IRD as well as at least 6 months of bank statements.
In addition, for larger loan sizes, you’ll need:
$100K-$250K: Application details including credit approval, 6-12 months of IRD statements, bank statements (if credit is over $150K).
$250K-$500K: Details of the application, including credit consent as well as 12 months bank statement, an IRD statements, last 2 years finalised financial statements, plus interim financials for the current financial year, Aged Payables and Aged Receivables reports.
How quickly will I receive a decision?
For an unsecured loan ($5K up to $100,000) we can often offer an answer in just one hour – as long as you apply at quality business timings and allow us to utilise the bank verification system link to instantly verify your bank details online. If you decide to submit copies of your bank statements , we’ll be able to provide an answer in just an company day.
For Larger Business Loans ($100K or more) we could be capable of offer you with pre-approval conditional to your application in around 6 hours. Once you have signed the pre-approval document, you will need to wait about 2-3 days for final approval. However, this can be quicker based on the particular circumstances of each application. Some deals have been approved within less than 24 hours.
The most efficient method can be make sure you apply during standard business hours. You can also let us use the advance bank verification to verify your bank information online. If you send us duplicates of your banking statements it will take a little longer.
How soon will I receive the funds?
For the Small Business Loan ($5K and up) We can usually offer a response in one hour – provided you apply during standard business times and let us use the advanced bank verification system link to instantly verify your bank’s information online. If you want to send us copies of your bank statements, we are able to provide the decision in as little as 1 business day.
If you are applying for Larger Business Loans ($100K up to $500,000) we might be able to provide you with a conditional pre-approval in about six hours. Once you’ve signed your pre-approval form, it will take between 2 and 3 days for the final approval. However, this could be shorter based on the particular circumstances of each application. Some offers have been approved in just 24 hours.
The fastest way for you to apply is make sure you apply during normal business hours, and allow us to use our sophisticated bank verification to instantly verify your bank account information online. If you choose to send us duplicates of your banking accounts, it will take a little longer.
How much can I borrow?
We offer the loan amount between $5,000 to $500,000. When you make an application for a particular amount, we take into consideration a range of factors that determine how much we can lend you health that is your business and the amount of the repayments your business will be able to support. The amount you receive from the loan will be determined by the particular circumstances of your business.
When you make an application for a specific amount we look at a range of aspects to assess how much we can lend you such as well-being for your business and the extent of repayments that your company will be able to support. The amount you receive from your loan will be contingent on the particular circumstances the business.
Fees & repayments
What is the cost for an company loan?
When you request the company loans, we’ll assess the risk assessment the business and provide an individualised offer including the amount of loan, the term and interest rates. A company loan is an upfront-priced loan therefore you will be aware of the total amount to be paid, including any interest rates, fees or charges.
What determines the amount I will be charged?
Interest rates for business loans rates depend on several factors such as the amount that is of money borrowed, the company assets the money are used to purchase as well as the field the business is in, how long the business is in operation and in the event that the business has enough cash flow to cover the loan, and general health or financial standing of the business.
What are the costs?
There are no hidden fees with our company loans. You’ll know precisely how much it is that you need to pay and at what time, from the first day. There’s no compounding and no additional fees (as long as you make your payments punctually).
We do not charge an application fee. You are able to apply for a loan with with no upfront cost or obligation to proceed.
The Origination Fee is the cost associated with establishing and managing the loan. It is only charged for this fee if you choose to proceed with the loan. The Origination Fee for us is 2.5 percentage of the amount of loan.
Can I repay the loan early?
You can choose to repay the entire amount of your loan in full at any time.
If you are deciding to do this please talk to one of our helpful company credit professionals. The professionals will provide you with details on repayment and an early payment figure. This is calculated as the total of the principal balance and any accrued interest at the date of early payout and 1.5 percent of the principal balance and any fees that remain unpaid.
What are the repayment methods?
In order to help you avoid missing due dates and also to be in line with your cash flow cycle we offer repayments that are either daily or weekly. They are automatically deducted from the nominated company account.
Security & privacy
Will my data be secure?
Making sure that your information is secure, and being clear about the ways we gather information, use it, and exchange it, as well as secure your information, is of paramount importance and is an essential part of our relationship you.
Is it safe to link my bank account to the platform?
Yes. We employ industry-recognised encryption protocols to safeguard your sensitive, personal financial information and our funders are ISO 27001 qualified for our dedication to the security of our clients as well as their privacy. We employ an exceptionally sophisticated bank verification system link to instantly confirm your bank account information online to offer an immediate response.
About business loans
What exactly is an asset-based loan (a secured loan)?
An asset-based loan is when a company owner uses the assets they have to make the funds for a loan. The asset could be an asset belonging to the personal, like the family home, or an business asset like a truck or piece or equipment.
The vast majority of lenders, even the banks with the biggest size, prefer to guarantee loans against an asset. If you’re struggling to pay back the loan then your asset may be sold by the lender. In essence it’s a way of securing new financing by using the value of what you already have.
What do I need security to get a business loan?
Up to $150,000 in loans there is no requirement for asset security before you are able to access the money However, we require a personal guarantee. need an individual guarantee. As long as you follow your loan commitments (as detailed in the loan contract) and you are able to meet your obligations, asset security will never be needed. For loans of over $150,000 typically, you will need personal ensure and security is provided in the form of charges on assets.