FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the Red Hill Small Business Loans
Tell me how you can avail the Red Hill Small Business Loans
Red Hill unsecured loans provides amounts between $5,000 and $100,000. The terms range between 3 and 24 month and cash flow-friendly repayments that are either per day or weekly.
What makes this Unsecured Loan different from the traditional company loan?
The application to your Small Business Loan in under 10 minutes via the internet or on the phone. You’ll receive an answer within the same day and funds may be on your account within 24 hours. Traditional company loans reference an annual interest rate plus other fees and charges. This business loan is a pre-paid loan and you’ll know in advance the amount you will have to pay, including any fees, charges or charges. Then, it is broken down into weekly or daily amount to be paid back.
What can the Small Business Loan be used for?
It is a Small Business Loan can be used for nearly every business need, such as managing cash flows, business remodels and marketing to purchase inventory, new equipment, as general working capital, and much more. The loan is not available for personal purposes.
Concerning Larger Red Hill Business Loans
What is the Larger Red Hill Business Loan?
The Larger Business Loan is a larger size loan to aid in company growth opportunities. Loans range between $100,000 and $500,000 with a fixed-term up to 36 months. Repayments are either weekly or fortnightly in order to accommodate your cash flow.
How is the Origination Fee determined?
This Larger Business Loan has an Origination Fee that is determined at 2.5% of the loan amount.
Do I qualify for the Larger Business Loan?
In order to be eligible for a loan that is this large, your business needs to be operating for at least three years with an annual turnover of $700,000. You must be a New Zealand Citizen (or Permanent Resident) at least 18 years old as well as own a New Zealand business (with a valid NZBN/IRD) and be able to prove at the least 12 months of operating.
How can the funds be utilised?
A large business loan can be used for almost all business need, including company improvements, purchasing new equipment or inventory for general working capital and much more. The loan cannot be used for personal use.
Is the Larger Business Loan one that is secured?
Asset security is necessary for accessing funds over $150,000. It is usually by way of charge against assets, which could also be registered on the PPSR or filing a caveat.
A personal or director’s ensure is a promise to repay credit that is general in nature, rather than stipulating security over a particular asset. The person signing the guarantee is personally liable if the business borrower is unable to re-pay the debt.
The Personal Property Securities Register (PPSR) is an online, central registry run by the New Zealand Government. It reflects security interests that are registered for personal property (including objects or assets). The PPSR permits priority over personal property to be granted in accordance with the date on which a security interest has been registered.
A caveat is a legal document filed to offer the legal claim on a property.
What is a pre-approval without Credit Check?
If you’re requesting a Larger Business Loan of more than $250,000 we may be able to provide an initial pre-approval in order to smooth out the process. We could be able to get this done without a credit check and within 6 hours of your initial application. This pre-approval is made based on an initial evaluation that involves you answering some financial well-being checks. It is neither an offer nor a guarantee of funds. Unconditional approval is subject to a full credit assessment and any offer you receive could be based on different terms.
The application process
Do I qualify for funds?
You may be eligible for a company loan if you
- are a New Zealand Citizen (or Permanent Resident)
- are at least 18 years old, have a New Zealand business (with a valid NZBN/IRD)
- must show at least six months of business (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 application process is quick and easy. Just complete the online application in just a few minutes, and a dedicated company loan specialist will be in touch to guide you through the process.
To apply for up to $100,000, you’ll need the right identification documents (valid Driver’s Licence) along with an NZBN/IRD that is valid and at least six months worth of bank statements.
If you’re looking for loans with larger sizes, you’ll need:
$100K – $250K: Details of application, including credit consent, 6 – 12 months of bank statements, IRD statement (if you have a loan of more than $150K).
$250K – $500K: Details for application including credit consent twelve months bank statement, an IRD statements and the last two years’ finalised financial statements, plus interim financial statements for the current year including Aged Payables, Aged Receivables Summary.
How soon will I hear a decision?
For an unsecured loan ($5K or more) we usually offer an answer within one hour if you apply during standard company hours and you allow us to utilise the advanced bank verification system link to instantly verify your bank information online. If you want to send us copies of your bank statements we can provide the decision within just 1 business day.
If you are applying for a Larger Business Loan ($100K and up) we may be capable of provide you with a conditional pre-approval within about six hours. Once you’ve signed the pre-approval, the turnaround time is between 2 and 3 days for the final approval, however it could be faster based upon the circumstances for each application. Some transactions have received approval in less than 24 hours.
The fastest way can be make sure you apply during normal company hours and allow us to use our modern bank verification to instantly verify your bank information online. If you choose to send us documents from your account statements , it can take a bit longer.
What is the time frame to receive the funds?
For the Small Business Loan ($5K to $100K) we can often provide an answer within one hour – as long as you apply during standard business timings and you allow us to use the advanced bank verification system to instantly verify your bank information online. If you opt to upload copies of your bank statements we can offer an answer in just the span of one business day.
For the Larger Business Loans ($100K and up) we may be in a position to provide you with conditional pre-approval within about 6 hours. Once you’ve signed the pre-approval form, it will take about 2-3 days for final approval. However, this can be faster depending on the circumstances of each application. Some agreements have been approved within 24 hours.
The most efficient method is to make sure you apply during normal business hours. You can also allow us to use the modern bank verification to instantly check your bank’s information online. If you send us copies of your bank statements, it may take a bit longer.
How much can I borrow?
We offer loans that range from $5,000 and $500,000. When you make an application for a particular amount, we look at a variety of variables to determine the well-being of the business and the amount of repayments your business is able to afford. The amount you receive from the loan will be determined by the specifics the company.
When you apply for a set amount, we consider a variety of elements to assess how much we can lend you such as health that is your company and the level of repayments your business can support. The amount you receive from your loan will depend on the specifics that are unique to your company.
Fees & repayments
How do you charge for the cost of a company loan?
If you decide to request our business credit, we’ll assess the risk profile for your business and provide an individualised proposal that includes the amount of the loan, the duration and the interest rates. The business loan is an upfront-priced loan therefore you will be aware in advance of the total amount you will have to pay, including interest rates, fees or charges.
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 will be used for, the industry the business is in, how long the company has been operating, how long the business has sufficient cash flow to pay for the loan, and overall well-being or financial standing of the company.
What are the fees?
There aren’t any hidden costs for our company loans. You’ll be aware of the amount you’ll be required to pay, and when, starting from the very first day. There’s not any compounding interest and there are no additional charges (as as long as you pay your payments in time).
We don’t charge an application fee. You are able to make an application for loans with absolutely no upfront cost and no obligation to proceed.
The Origination Fee covers the costs associated in establishing and managing the loan. You are only charged this fee if you decide to take the loan. The Origination Fee for us is 2.5 percent of the loan amount.
Can I repay the loan early?
You can choose to repay the entire amount of your advance loan at any time.
If you are deciding to take this route, please contact our helpful company credit experts. They will provide you with repayment details and an early payout figure. It will be calculated using the sum of the principal amount remaining and accrued interest to the date of early payout, plus 1.5 percent of the remaining principal and any fees that remain unpaid.
How do you make repayments work?
To help you avoid missing payments and to work your cash flow cycle we offer repayments that are either daily or weekly. They are automatically deducted from your nominated business account.
Security & privacy
Will my information be secure?
Making sure that your information is secure, and being clear about how we collect information, use it, and exchange it, as well as secure your information, is crucial and an integral 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 protect your sensitive, personal as well as financial data. Our funders are ISO 27001 qualified for our commitment to security for our clients and security. We utilise a sophisticated bank verification system link to immediately verify your bank account details online. This allows us to provide rapid response.
About business loans
How do you define asset-based lending (a secured loan)?
Asset-based borrowing is when a business owner utilises the assets they have to obtain the funds for a loan. The asset may be an individual asset, such as the family home or a company property like a truck or piece or equipment.
The vast majority of banks, including the big banks, tend to secure loans against assets. If you’re having trouble paying back the loan, then the asset could be taken over by the lender. In essence, it’s a way of securing new funding using the worth of the asset you already have.
What do I require security to get a business loan?
For loans of up to $150K, it is not necessary to secure assets upfront to access the money but we require a personal guarantee. need an individual guarantee. So long as you comply with your loan obligations (as specified in your loan contract document) Asset security will never be required. For loans over $150K generally there is an individual guarantee and security is provided in the form of the charge of assets.