Common Lending Criteria

In a recent survey, 46% of SMEs said that access to funding was one of the biggest challenges they face. When it comes to finance for businesses, there is not a ‘one size fits all’ solution. There are a range of options available to service a variety of different requirements.

Some of the solutions we can arrange includes business loans, bridging loans, commercial mortgages, asset finance, invoice finance, trade finance and cash advances. Each one has its merits, but they are not all suitable for every business.

Once we have identified an appropriate solution for you, we can approach a lender that provides that solution, and has appetite to support your business. Each lender has different criteria for lending. Some of the following factors could influence whether you can get support from a particular lender:

Trading Time – how long have you been in business? How many sets of accounts have you filed?

Legal Structure – are you a sole trader or a limited company?

Personal Guarantees and their strength – are you willing to sign a PG and do you have any personal assets that can strengthen this?

Homeowning Directors – do any directors own their own home? Depending on the level of equity, this can strengthen a PG and increase the level of funding you can access.

Debentures – this is an agreement between your business and the lender outlining how your business assets will be used to secure the loan if you default. Would you be open to this?

Business and Director Credit Histories – do you, your business, or other directors have any current or historic adverse credit?

B2B or B2C – are you selling business to business or business to consumer?

Open Banking Access and Bank Accounts – do you give the lender permission to review your bank account management?

The hardest part can be knowing what you need, and where you can find it. Fortunately, this is something we can help with and will outline to you at the beginning of the process. This will let you know what to expect and allow you to prepare accordingly.