FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
Information About The Cockatoo Small Business Loans
Tell me about the Cockatoo Small Business Loans
Cockatoo unsecured loans offers the range of $5,000 to $100,000. Terms range from 3 and 24 months, cash flow-friendly repayments, which are either daily or weekly.
What makes what makes the Unsecured Loan different from a traditional business loan?
It is possible to apply to the Small Business Loan in under 10 minutes on the phone. You’ll receive an immediate response, and have the funds on your account within 24 hours. Traditional business loans are based on an interest rate per annum plus other fees and charges. This business loan is a cash-based loan therefore you’ll know ahead of time the amount you will have to pay, including any interest, fees or charges. This is then divided into weekly or daily repayment figure.
What can you use the Small Business Loan be used for?
A Small Business Loan can be used for virtually any company use, including control of cash flow business renovations, marketing for purchasing inventory or new equipment, to fund general working capital and much more. The loan is not available for personal use.
About Larger Cockatoo Business Loans
What is the Larger Cockatoo Business Loan?
The Larger Business Loan is a larger size loan to aid in business expansion opportunities. The loan ranges from $100,000 to $500,000 over a fixed term with a maximum of 36 months. Repayments are either weekly or fortnightly, depending on you cashflow.
How’s the Origination Fee determined?
A Larger Business Loan has an Origination Fee, calculated at 2.5 percentage of the loan amount.
Am I eligible for the Larger Business Loan?
To qualify for a loan of this size the business needs to be trading for at least 3 years, and have an annual income of $700,000. You must be a New Zealand Citizen (or Permanent Resident) who is over the age of 18, own a New Zealand company (with a valid NZBN/IRD) and be able to prove at minimum 12 months of business.
How can the funds be utilised?
A Larger Business Loan can be used to fund almost all business reason, such as company improvements, purchasing equipment or inventory, as general working capital, and much more. The loan cannot be used for personal use.
Is the Larger Business Loan a secured loan?
Asset security is needed for funding of more than $150,000. It’s in the form of a charge on assets, and may be registered with the PPSR or making as a caveat.
A director’s or personal guarantee is a guarantee to pay off a credit line that is generally based rather than stipulating security over a particular asset. The person who is signing the ensure is personally responsible if the company the borrower fails to re-pay the debt.
The Personal Property Securities Register (PPSR) is an online, central registry run by the New Zealand Government. It records security interests that have been which are registered with respect to personal property (including items or assets). The PPSR gives priority over personal property to be assigned in accordance with the date on which a security interest has been registered.
Caveats are legal form of document to provide an official notice of a claim to a property.
What is a pre-approval that does not require Credit Check?
If you’re requesting a Larger Business Loan that exceeds $250,000 we can offer an initial pre-approval that will help simplify the process. We may be able to make this decision without a credit check, and within 6 hours of your initial application. This pre-approval is based on a preliminary assessment which includes you answering some financial well-being questions. It is neither an offer nor a guarantee of financing. Acceptance without condition is subject to a full credit assessment and any offer that you receive could have different terms.
The application process
Do I qualify for funds?
You are eligible to apply for an business loan if you;
- are a New Zealand Citizen (or Permanent Resident)
- are over 18 years, have a New Zealand business (with a valid NZBN/IRD)
- must show at least six months of trading (for you to qualify for unsecured loan $5K – $100K) or 3 years of continuous trading (for the Larger Business Loan $100K to $500K)
How do I apply?
The application process is simple and easy. Just fill out the online application within a few minutes and a dedicated business credit specialist will be in touch to help you.
To apply for up to $100,000 you’ll require ID details (valid Driver’s Licence) as well as an NZBN/IRD that is valid and at least 6 months of bank statements.
For larger loan sizes, you’ll also require:
$100K-$250K: Details of application, including credit approval, 6-12 months of IRD statements, bank statements (if you have a loan of more than $150K).
$250K – $500K: Application details including credit consent, 12 months bank statement, an IRD statement and the last two years’ finalised financial statements, and 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 or more) we usually provide a response in one hour if you submit your request at standard business times and allow us to use the advanced bank verification system to instantly verify your bank’s information online. If you choose to upload copies of your bank statements , we will be able to offer a decision within one business day.
For the Larger Business Loan ($100K up to $500,000) we could be able to provide the conditional pre-approval within 6 hours. After you’ve signed the pre-approval, turnaround times are between 2 and 3 days for the final approval, however this can be quicker based upon the circumstances for each application. Some agreements have been approved in the space of 24 hours.
The quickest way to apply for you to apply is ensure you apply during normal business hours. Also, permit us to use the advance bank verification link to instantly confirm your bank details online. If you opt to send us copies of your bank statement, it takes a bit longer.
How fast will I get the funds?
For the Small Business Loan ($5K to $100K) we typically provide a response in one hour – as long as you make your application in normal business hours and let us utilise the advanced bank verification system to immediately verify your bank account information online. If you opt to upload copies of your bank statements, we will be able to provide a decision within one business day.
If you are applying for Larger Business Loans ($100K or more) we might be capable of offer you with conditional pre-approval within six hours. Once you’ve signed the pre-approval, the turnaround time is around 2-3 days for final approval, however it could be faster based upon the circumstances for each application. Some offers have been approved within less than 24 hours.
The fastest way for you to apply is make sure you apply during standard business hours and let us use the advance bank verification to check your bank’s information online. If you upload the copies of bank accounts, it takes a bit longer.
What’s the minimum amount I can borrow?
We provide loans ranging from $5,000 and $500,000. When you submit an application for a particular amount, we look at a variety of variables that determine the health for your business and the amount of the repayments your company is able to afford. The amount you receive from your loan will be contingent on the specific circumstances the business.
When you apply for a specific amount we take into consideration a variety of factors to determine your well-being for your business as well as the amount of payments your company can afford. The amount you receive from the loan will be determined by the particulars for your business.
Fees & repayments
How much should you charge for a business loan?
When you request our business loans, we will assess the risk assessment that you have for your company and provide you with a customised offer including the amount of loan, the term and the interest rates. It is a business loan is a loan that is priced upfront which means you be aware of the total amount to be paid, including any interest rates, fees or charges.
What determines the amount I’m charged?
Interest rates for company loans rates differ based on various factors such as the amount that is borrowed, what company assets the money are used to purchase as well as the field the business is operating in, how long the company has been operating and whether the company has enough cash flow to cover the loan, and also the overall well-being or financial standing of the business.
What are the fees?
There aren’t any hidden costs for our company loans, and you’ll know exactly how much it is that you be required to pay and when, right from the first day. There’s no compounding interest and no extra fees (as long as you make your payments on time).
We do not charge an application fee. You can get a cash loan with absolutely no upfront cost and no obligation to proceed.
The Origination Fee covers the costs associated with establishing and managing the loan. This is only a fee if you proceed with the loan. The Origination Fee for us is 2.5 percent of the amount of the loan.
Can I repay the loan in advance?
You can decide to repay the entire amount of your advance loan at any time.
If you decide to take this route, please speak to our friendly business loans specialists. They’ll provide you with details for repayment and an early payment figure. This will be calculated as the sum of the principal remaining and any accrued interest at the time of early payout plus 1.5% of the remaining principal as well as any outstanding fees.
How do repayments work?
To ensure you do not miss payments and to work your cash flow schedule, we offer repayments either daily or weekly. They will be automatically deducted from your nominated company account.
Security & privacy
Will my data be protected?
The security of your personal information, as well as being transparent about how we collect data, process, exchange and safeguard your data, is of paramount importance and is an essential part of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We make use of industry-standard encryption protocols to safeguard your sensitive, personal financial information and our funders are ISO 27001 qualified for our commitment to the security of our clients as well as their security. We use an advanced bank verification system that allows you to instantly confirm your bank account information online, allowing us to offer quick responses.
About business loans
What’s an asset-based borrow (a secured loan)?
Asset-based borrowing occurs when an company owner makes use of an asset that they own to obtain the funding. The asset could be an individual asset, such as the family home or it could be a company asset such as a vehicle or other piece of machinery.
The vast majority of lending institutions, not just the largest banks, are inclined to secure loans against assets. If you have trouble paying back the loan, then the asset could be sold by the lender. In essence it is means of securing new financing by using the worth of the asset you already own.
What do I require security to get an company loan?
Up to $150K in loans the requirement for asset security is not required in advance to gain access to the funds, however we require a personal guarantee. need a personal guarantee. If you adhere to your loan commitments (as stipulated in the loan contract), asset security is not needed. If you take out loans in excess of $150K typically, you will need the option of a personal ensure and security is provided in the form of a charge over assets.