FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the Sherwood Small Business Loans
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Sherwood unsecured loans provides amounts of between $5,000 and $100,000, with terms ranging from 3 and 24 months, cash flow friendly repayments that are either per day or weekly.
What makes this Unsecured Loan different from a traditional company loan?
You can apply to get your Small Business Loan in under 10 minutes on the internet or over the phone, receive an immediate response, and the money could be in your account within 24 hours. Traditional business loans have an annual rate of interest along with other charges and fees. The company loan is a cash-based loan which means you know in advance the total amount due, which includes any interest, fees or charges. This is then broken down into weekly or daily amount to be paid back.
What could be the Small Business Loan be used for?
It is a Small Business Loan can be used for virtually every company need, such as managing cash flows, business remodels and marketing for purchasing inventory or new equipment, to fund general working capital, and much more. The loan is not available for personal use.
About the Larger Sherwood Business Loans
What is the Larger Sherwood Business Loan?
The Larger Business Loan is a larger size loan to aid in business growth opportunities. Loans are between $100,000 and $500,000 with a fixed-term with a maximum of 36 months. The repayments are made weekly or fortnightly in order to accommodate your cash flow.
How is the Origination Fee calculated?
A Larger Business Loan has an Origination Fee which is calculated at 2.5% of the loan amount.
Can I get the Larger Business Loan?
In order to be eligible for a loan that is this large, your business needs to be trading for at least 3 years with an annual turnover of $700,000. Your company must belong to a New Zealand Citizen (or Permanent Resident) who is over the age of 18 and have a New Zealand business (with a valid NZBN/IRD) and be able demonstrate at least 12 months of trading.
What can the funding be used for?
A Business Loan of a larger size is a great option for almost all business use, including company remodeling, buying new equipment or inventory, as general working capital and so much more. The loan is not available to fund personal expenses.
Is the Larger Business Loan a secured loan?
Asset security is required to obtain funding above $150,000. It’s in the form of a charge on assets and can include registering this on the PPSR or making a caveat.
A director’s or personal guarantee is a guarantee to pay back a loan that is generally based rather than defining security over a particular asset. The person who is signing the guarantee is personally liable if the business borrower is unable to pay back the debt.
The Personal Property Securities Register (PPSR) is an online, central registry run by the New Zealand Government. It contains security interests registered in respect of personal property (including items or assets). The PPSR allows preference over private property granted depending on the date that a security interest that is registered.
An affidavit is an official document lodged to provide notice of a legal claim against a property.
What is a pre-approval without Credit Check?
If you’re applying for the Larger Business Loan of more than $250K, we may offer an initial pre-approval in order to make the process. It is possible to do this without a credit verification and within six hours of your initial application. This pre-approval is based on a preliminary assessment which includes you answering a few financial health questions. This is in no way an offer, nor is it a guarantee of finance. A conditional approval is subject an extensive credit evaluation and any offer you are offered could be based on different terms.
Application process
Can I be eligible for funding?
You can apply for an business loan if you:
- are a New Zealand Citizen (or Permanent Resident)
- are 18 years or older, own a New Zealand company (with a valid NZBN/IRD)
- you must demonstrate at minimum 6 months’ worth of transactions (for the unsecured loan $5K – $100K) or 3 years of trading (for the Larger Business Loan $100K to $500K)
How do I apply?
The application process is fast and simple. Simply complete the online form within a few minutes and a dedicated business lending specialist will call you to guide you.
To apply for up $100,000 you’ll require ID details (valid Driver’s Licence) and an active NZBN/IRD, and at least 6 months of bank statements.
Otherwise, for larger loan sizes, you’ll also need:
$100K – $250K: Application details including credit approval, 6-12 months of bank statements, IRD statement (if you have a loan of more than $150K).
$250K to $500K: Details for application including credit consent, 12 months of bank statements, IRD statement, last 2 years finalised financial statements, and interim financials for the current financial year, Aged Payables and Aged Receivables summaries.
How quickly will I receive an answer?
For an unsecured loan ($5K to $100K) we typically offer an answer within an hour if you submit your request in quality business time and you allow us to use the advanced bank verification system to instantly verify your bank’s information online. If you decide to upload copies of your banking statements we can provide the decision within one business day.
For Larger Business Loans ($100K and up) we might be likely to offer you with a conditional pre-approval within 6 hours. After you’ve signed the pre-approval, the turnaround time is approximately 2-3 days to receive final approval, however this may be quicker depending on the particular circumstances of each application. Some offers have been approved within 24 hours.
The fastest way for you to apply is ensure you apply during standard business hours and allow us to use our modern bank verification to confirm your bank details online. If you send us duplicates of your banking accounts, it takes a bit longer.
How quickly will I receive the money?
For the Small Business Loan ($5K to $100K) we can often offer a response in one hour – as long as you submit your request within standard business hours and allow us to utilise the advanced bank verification system link to instantly verify your bank details online. If you decide to send us copies of your bank statements, we are able to provide the decision in as little as 1 business day.
For Larger Business Loans ($100K and up) we might be capable of offer the conditional pre-approval within about six hours. Once you’ve signed your pre-approval, the turnaround time is between 2 and 3 days for the final approval. However, this could be shorter based on the circumstances of each application. Some agreements have been approved within just 24 hours.
The fastest method is to ensure you apply during standard business hours. You can also permit us to use the modern bank verification link to check your bank’s information online. If you send us documents from your account statements, it takes a bit longer.
How much can I borrow?
We offer loan amounts between $5,000 to $500,000. When you make an application for a certain amount we will consider a number of elements for determining how much we can lend you well-being for your business as well as the amount of the repayments your business is able to afford. The total amount of your loan will be contingent on the specific circumstances for your business.
When you make an application for a certain amount, we look at a range of aspects to determine the well-being of the business and the level of payments your company can afford. The amount you receive from the loan will be determined by the particular circumstances for your business.
Fees & repayments
How much do you charge for a business loan?
If you decide to request the business loans, we will assess the risk assessment of your company and offer you with a customised offer including the amount of loan, the term and the interest rates. It is a company loan is a loan that is priced upfront so you will be aware of the total amount to be paid, including any interest rates, fees or charges.
What is the factor that determines the price I pay?
Business loan interest rates depend on a variety of factors such as the amount that is borrowed, what company assets the money will be used for in addition to the industry that the company is in, how long the company has been running for, in the event that the business has enough cash flow to support the loan, and the general health as well as creditworthiness company.
What are the fees?
There are no hidden costs for our company loans. You’ll know precisely how much you’ll need to pay, and when, starting from the day you sign up. There’s no compounding and the loan comes with no additional fees (as as long as you pay your payments punctually).
We do not charge an application fee. You can apply for a loan no cost upfront or any obligation to sign up.
The Origination Fee is the cost associated in establishing and managing the loan. The only way to pay this cost if you take out the loan. The Origination Fee for us is 2.5 percent of the loan amount.
Can I repay the loan earlier?
You can decide to repay the entire amount of your loan in full at any time.
If you do decide to pursue this option, please talk to one of our helpful company credit specialists. The professionals will provide you with details for repayment along with an early payout estimate. This will be calculated as the total of the remaining principal amount and any accrued interest at the time of early payment plus 1.5% of the remaining principal and any outstanding fees.
What are the repayment methods?
To ensure you do not miss repayments and to fit in your cash flow schedule, we offer repayments that are either weekly or daily. These are automatically deducted from your designated company account.
Security & privacy
Will my information be protected?
Making sure that your information is secure, and knowing the ways we gather the information we collect, use, share and protect your information, is vital and is an essential aspect of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We make use of industry-standard encryption standards to secure your sensitive, personal financial and other data. Our funders are ISO 27001 certified for our commitment to customer security and privacy. We employ an exceptionally sophisticated bank verification system to immediately verify the bank account details online to provide an immediate response.
About business loans
What is asset-based borrowing (a secured loan)?
Asset-based borrowing occurs when a business owner borrows from an asset they own to get the funding. The asset can be either a personal asset like the family home or it could be a company property like a truck or piece or equipment.
The majority of the lenders not just the big banks, tend to secure loans against an asset. If you have trouble paying back the loan then your assets could be offered for sale by the lender. In essence it is a way of securing new financing taking advantage of the value of what you already own.
Do I require security to secure a business loan?
Up to $150K in loans no asset security is required prior to the loan’s access However, we require a personal guarantee. need an individual guarantee. So long as you comply with your loan obligations (as stated in your loan contract document) the security of assets is not required. For loans that exceed $150,000, generally, you are able to get the option of a personal guarantee and security that is in the form an asset charge.