FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
Information About The Hawthorn Small Business Loans
Let me know how you can avail the Hawthorn Small Business Loans
Hawthorn unsecured loans provides amounts of between $5,000 and $100,000. The terms range between 3 and 24 months and cash flow-friendly repayments which can be made daily or weekly.
What makes what makes the Unsecured Loan different from an traditional company loan?
The application for your Small Business Loan in under 10 minutes over the phone, receive an answer within the same day and the funds could be on your account within 24 hours. Traditional business loans refer to an interest rate per annum as well as other fees and charges. The business loan is an upfront priced loan so you will know ahead of time the total amount to be paid, including any interest, fees or charges. Then, it is divided into a daily or weekly repayment figure.
What could you use the Small Business Loan be used for?
The Small Business Loan can be used for nearly any company reason, such as control of cash flow company remodeling, marketing, to purchase inventory or new equipment, for general working capital and much more. The loan is not available for personal use.
About Larger Hawthorn Business Loans
What is the Larger Hawthorn 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 for up to 36 months. Repayments are weekly or fortnightly in order to accommodate you cashflow.
How is the Origination Fee calculated?
The Larger Business Loan has an Origination Fee which is determined at 2.5% of the loan amount.
Am I eligible for the Larger Business Loan?
To qualify for a loan in this amount, your company needs to have been operating for a minimum of 3 years and generate an annual revenue of $700K. The applicant must also be a New Zealand Citizen (or Permanent Resident) with a minimum age of 18 years old and have a New Zealand business (with a valid NZBN/IRD) and be able of proving at minimum 12 months of continuous trading.
How can the funds be utilised?
A larger company loan can be used to fund almost every company need, including company renovations, purchase of new equipment or inventory or as general working capital and much more. The loan is not available to fund personal expenses.
Is the Larger Business Loan a secured loan?
Asset security is necessary to access funding over $150,000. This can be done in the form of a charge over assets, and may include registering this in the PPSR or registering a caveat.
A personal or director’s ensure is a promise to pay off a credit line that is general in nature rather than defining security over a particular asset. The person signing the ensure is personally accountable if the company the borrower fails to make the repayment.
The Personal Property Securities Register (PPSR) is an online central register operated by the New Zealand Government. It records security interests that have been which are registered with respect to personal property (including goods or assets). The PPSR grants prioritisation over property that is personal to be assigned depending on the date that a security interest that is registered.
A caveat is a legal document that is filed to offer notice of a legal claim against a property.
What is a pre-approval minus Credit Check?
If you’re seeking the Larger Business Loan that is greater than $250K it is possible to offer a preliminary pre-approval to help smooth out the process. It is possible to get this done without credit checks and within 6 hours of the initial application. This pre-approval is made based on an initial assessment that includes answering a couple of financial health questions. It is not an offer of credit or guarantee of financing. A conditional approval is subject an assessment of your creditworthiness and any offer that you are offered could be on different terms.
The application process
Do I qualify for funds?
You may apply for a company loan if you:
- are a New Zealand Citizen (or Permanent Resident)
- are at least 18 years old, have a New Zealand company (with a valid NZBN/IRD)
- must show at least six months’ worth of transactions (for you to qualify for unsecured loan $5K – $100K) or 3 years of trading (for the Larger Business Loan $100K - $500K)
How do I apply?
The application process is quick and easy. Just complete the online application in just a few minutes, and a dedicated company expert in lending will call you to help you.
For a loan of up to $100,000, you’ll require identification details (valid Driver’s Licence) as well as a valid NZBN/IRD as well as at least 6 months of bank statements.
If you’re looking for loans with larger sizes, you’ll require:
$100K-$250K: Application details including credit approval, 6-12 months of IRD statements, bank statements (if the loan is greater than $150K).
$250K-$500K: Details for application including credit consent and 12 months of bank records, IRD statements and the last two years’ finalised financial statements, in addition to interim current financial year financials, Aged Payables and Aged Receivables summary.
How soon will I hear an answer?
For an unsecured loan ($5K up to $100,000) We can usually offer an answer within an hour, provided you submit your request in standard business times and let us make use of the advanced bank verification system to instantly verify your bank details online. If you choose to upload copies of your bank statement, we’ll provide an answer in just the span of one business day.
For the Larger Business Loan ($100K and up) we may be in a position to offer you with conditional pre-approval in about six hours. Once you have signed the pre-approval, the turnaround time is between 2 and 3 days for the final approval, however this can be quicker based upon the circumstances for each application. Certain deals have been approved within 24 hours.
The quickest method is to ensure you apply during standard business hours. You can also let us use the advance bank verification link to check your bank’s information online. If you decide to send us duplicates of your banking statements it will take a little longer.
How fast will I get the cash?
For the Small Business Loan ($5K and up) we usually offer an answer within an hour – as long as you submit your request at standard business times and you allow us to use the bank verification system to instantly verify your bank information online. If you opt to upload copies of your banking statements, we are able to offer an answer in just one business day.
If you are applying for Larger Business Loans ($100K to $500K) we could be in a position to offer you with conditional pre-approval within about six hours. Once you’ve signed the pre-approval form, it will take between 2 and 3 days for the final approval, however this may be quicker depending on the circumstances of each application. Some agreements have been approved within less than 24 hours.
The fastest way would be to ensure you apply during normal business hours. You can also let us use the sophisticated bank verification to check your bank’s information online. If you choose to send us copies of your bank statement, it can take a bit longer.
What’s the minimum amount I can borrow?
We offer loan amounts between $5,000 to $500,000. When you submit an application for a specific amount we will consider a number of aspects that determine how much we can lend you well-being of the business and the amount of repayments your company can afford. The amount you receive from your loan will depend on the specifics of your company.
When you submit an application for a particular amount, we consider a variety of aspects to assess how much we can lend you such as well-being of your company and the extent of repayments that your business can support. The total amount of your loan will be contingent on the specific circumstances that are unique to your company.
Fees & repayments
What is the cost for an company loan?
If you decide to make an application for our business credit, we’ll assess the risk profile the company and provide an individualised proposal that includes loan amount, term and interest rates. This business loan is a loan that is priced upfront therefore you will know the exact amount due, which includes any charges or interest.
What is the factor that determines the price I’m charged?
Interest rates for company loans rates depend on a variety of factors such as the amount that is borrowed, the business assets the money are used to purchase, the industry the company is operating in, how long the company has been in operation for, what percentage of the company has enough cash flow to support the loan, and also the general health as well as creditworthiness business.
What are the charges?
There are no hidden costs with our business loans, and you’ll know exactly how much you be required to pay and when, from day one. There’s no compounding interest and no extra fees (as as long as you pay your payments punctually).
We do not charge an Application Fee. You are able to get a cash loan absolutely no upfront cost and no the obligation to take action.
The Origination Fee covers the costs associated with setting up and managing the loan. It is only charged for this fee if you decide to take the loan. The Origination Fee for us is 2.5% of the amount of loan.
Can I pay off the loan in advance?
You can choose to repay the entire amount of your loan at any point in time.
If you are deciding to take this route, please talk to one of our helpful business credit experts. They’ll provide you with details on repayment as well as an early payout amount. This is calculated as the total of the principal remaining and accrued interest to the time of the early payout, plus 1.5 percent of the remaining principal and any fees that remain unpaid.
How do you make repayments work?
In order to help you avoid missing payments and to work with your cash flow cycle we provide repayments either weekly or daily. These are automatically deducted from your designated company account.
Security & privacy
Will my information be secure?
Protecting your information, and being clear about the ways we gather the information we collect, use, share and safeguard your data, is vital and is an essential element 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 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 link to instantly verify your bank account details online so we can provide rapid response.
About business loans
What’s an asset-based borrow (a secured loan)?
An asset-based loan is when a business owner uses assets they own to make the loan. The asset could be an individual asset, such as the family home or an business asset such as a truck or other piece of machinery.
The vast majority of lenders, including the banks with the biggest size, prefer 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 by making use of the value of what you already own.
What do I require security for a business loan?
For loans up to $150K 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. In the event that you fulfill the loan terms (as stipulated in your loan contract document) Asset security is not required. If you take out loans in excess of $150K generally, there is an individual guarantee and security in the form the charge of assets.