FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
About The The Patch Small Business Loans
Tell me more about The Patch Small Business Loans
The Patch unsecured loans offers amounts of between $5,000 and $100,000 with terms between 3 and 24 months. They also offer cash flow-friendly repayments that are either daily or weekly.
How is this Unsecured Loan different from an traditional company loan?
It is possible to apply for this Small Business Loan in under 10 minutes online or over the phone, receive an answer within the same day and the money could be in your account in 24 hours. Traditional company loans are based on an interest rate per annum along with other charges and fees. We offer a company loan is a cash-based loan so you will know ahead of time the amount you will have to pay, including any fees, charges or charges. Then, it is divided into a daily or weekly amount to be paid back.
What could you use the Small Business Loan be used for?
It is a Small Business Loan can be used to fulfill almost every business need, such as cash flow management, business remodels and marketing to purchase inventory or new equipment, as general working capital and much more. The loan cannot be used for personal purposes.
About the Larger The Patch Business Loans
What is the Larger The Patch Business Loan?
The Larger Business Loan is a larger size loan to aid in business growth opportunities. The loan ranges from $100,000 to $500,000 for a fixed period of up to 36 months. Repayments are scheduled weekly or fortnightly, depending on you cashflow.
How’s the Origination Fee calculated?
A Larger Business Loan has an Origination Fee that is determined at 2.5% of the loan amount.
Can I get the Larger Business Loan?
To qualify for a loan in this amount the company needs to have been operating for at least three years, and have an annual income of $700,000. You must be a New Zealand Citizen (or Permanent Resident) at least 18 years old and have a New Zealand company (with a valid NZBN/IRD) and be able demonstrate at the least 12 months of operating.
How can the funding be utilised?
A Larger Business Loan can be used to fund almost every company reason, such as business renovations, purchase of equipment or inventory for general working capital and so much more. The loan cannot be used for personal use.
Is the Larger Business Loan one that requires security?
Asset security is required to access funding over $150,000. It is usually in the form of a charge over assets and can be registered on the PPSR or the registration of as a caveat.
A personal or director’s guarantee is a promise to pay off a credit line that is general in nature, rather than defining security over an asset. The person who signs the guarantee is personally liable in the event that the business the borrower fails to re-pay the debt.
The Personal Property Securities Register (PPSR) is an online, central register run by the New Zealand Government. It reflects security interests granted to individuals who own personal property (including items or assets). The PPSR permits prioritisation over property that is personal to be assigned according to the date the security interest has been registered.
The caveat can be described as a formal form of document to provide an official notice of a claim to property.
What exactly is a preapproval without Credit Check?
If you’re seeking the Larger Business Loan of $250K or more, we may offer an initial pre-approval in order to smooth out the process. We may be able to do this without a credit check, and within 6 hours of your initial application. This pre-approval is made based on an initial assessment that includes the answer to a series of financial health checks. It is in no way an offer, nor is it a guarantee of financing. Unconditional approval is subject to an assessment of your creditworthiness and any offer that you may receive may be subject to different conditions.
Application process
Are I eligible for funding?
You may be eligible for a company 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)
- you must prove at least 6 months worth of trade (for for the unsecured loan $5K – $100K) or three years of trade (for the Larger Business Loan $100K to $500K)
How do I apply?
The process for applying is fast and easy. Just fill out the online application in few minutes and an experienced business credit specialist will call you to help you.
For a loan of up to $100,000, you’ll need ID details (valid Driver’s License) along with a valid NZBN/IRD as well as at least six months worth of bank statements.
For larger loan sizes, you’ll require:
$100K-$250K: Information about the application including credit consent, 6 – 12 months of bank statements, IRD statement (if you have a loan of more than $150K).
$250K-$500K: Information on the application including credit consent twelve months bank statement, an IRD statements and the last two years’ finalised financial statements, plus interim financials for the current financial year as well as Aged Payables and Receivables summary.
How fast will I get a decision?
For an unsecured loan ($5K up to $100,000) we typically offer a response in one hour if you submit your request at standard company times and let us make use of the advanced bank verification system to instantly verify your bank details online. If you opt to send us copies of your bank statements we can offer a decision in as little as 1 business day.
For the Larger Business Loan ($100K or more) we may be able to provide you with conditional pre-approval in about six hours. After you’ve signed your pre-approval document, you will require to wait between 2 and 3 days for the final approval. However, this may be quicker depending on the particular circumstances of each application. Certain transactions have received approval in 24 hours.
The fastest way for you to apply is ensure you apply during normal business hours, and allow us to use our advance bank verification to verify your bank information online. If you opt to upload duplicates of your banking statements , it may take a bit longer.
How soon will I receive the money?
For the Small Business Loan ($5K up to $100,000) We can usually provide an answer in just one hour – as long as you submit your request at standard business time and permit us to use the bank verification system link to immediately verify your bank account information online. If you decide to upload copies of your bank statements we can offer the decision within an business day.
If you are applying for Larger Business Loans ($100K up to $500,000) we might be able to offer you with a conditional pre-approval in around six hours. After you’ve signed the pre-approval, the turnaround time is approximately 2-3 days to receive final approval, however this could be shorter based on the specifics of each application. Some deals have been approved in 24 hours.
The most effective method can be make sure you apply during standard business hours and allow us to use our modern bank verification to instantly confirm your bank details online. If you opt to upload the copies of bank statements it may take a bit longer.
How much can I borrow?
We provide the loan amount between $5,000 to $500,000. When you make an application for a specific amount we take into consideration a range of elements to determine how much we can lend you well-being of the company as well as the amount of the repayments your business will be able to support. The total amount of the loan will be determined by the specifics for your business.
If you apply for a set amount, we take into consideration a variety of factors to assess the well-being of the business and the amount of repayments that your company can support. The amount you receive from your loan will be determined by the particulars the business.
Fees & repayments
What is the cost for the cost of a company loan?
When you request the company financing, we will assess the risk assessment of your business and provide an individualised proposal that includes the loan amount, the terms and the interest rates. The company loan is an upfront cost loan therefore you will know the exact amount you will have to pay, including costs, fees, or interest rates.
What is the factor that determines the price I am charged?
The interest rates on company loans rates depend on several variables like the amount to be that is borrowed, what company assets the money will be used for as well as the field the company operates in, how long the company has been in operation for, how long the business has enough cash flow to support the loan, and overall health and creditworthiness of the business.
What are the cost?
There aren’t any hidden costs for our business loans, and you’ll know precisely how much you be required to pay and when, from the day you sign up. There’s no compounding interest and the loan comes with no additional fees (as as long as you pay your payments punctually).
We don’t charge an application fee. You can get a cash loan absolutely no upfront cost and no commitment to apply.
The Origination Fee covers the expenses involved with the setting up and management of the loan. You are only charged this cost if you take out the loan. The Origination Fee for us is 2.5 percentage of the amount of loan.
Can I pay off the loan earlier?
You can choose to repay the entire amount of the loan at any point in time.
If you are deciding to pursue this option, please speak to our friendly business loans professionals. We will offer you with details for repayment and an early payment figure. This is calculated as the total of the principal balance and the accrued interest up to the date of early payout in addition to 1.5% of the principal balance and any fees that remain unpaid.
How do you make repayments work?
In order to help you avoid missing due dates and also to be in line your cash flow cycle we offer repayments either weekly or daily. These are automatically withdrawn from your nominated business account.
Security & privacy
Will my information be protected?
Security of your data, and making it clear the ways we gather, use, exchange and ensure the security of your information is vital and a vital part of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We utilise industry-recognised encryption standards to secure your sensitive, personal as well as financial data. Our funders are ISO 27001 qualified for our commitment to customer security and security. We employ a highly sophisticated bank verification system that allows you to instantly verify your bank account details online to provide an immediate response.
About business loans
What exactly is an asset-based loan (a secured loan)?
Asset-based borrowing occurs when a company owner makes use of assets they own to get the funding. The asset may be an asset belonging to the personal, like the family home, or a company asset such as a truck or other piece of machinery.
The vast majority of lending institutions, including the banks with the biggest size, prefer to guarantee loans against assets. If you’re having trouble paying back the loan, then your asset may be offered for sale by the lender. In essence, it is the process of securing additional financing using the worth of the asset you already own.
What do I require security for an company loan?
For loans of up to $150K, the requirement for asset security is not required upfront to access the money, however we do require a personal guarantee. As long as you follow your loan commitments (as stated in the loan contract) the security of assets is not required. For loans over $150K typically, you will need a personal ensure and security in the form of an asset charge.