Mainstream lenders lean heavily on credit history. Lenders that focus on security, such as property-secured, asset-backed and private lenders, look more at equity and how the loan will be repaid. That is where most business owners with credit issues find a path.
What to know
Be upfront
Lenders will see your credit file. Explaining what happened, and what has changed since, helps far more than hoping it is missed.
Security changes the answer
Equity in property can outweigh a patchy credit file for security-focused lenders, particularly for short-term loans with a clear exit.
Avoid a string of applications
Each formal application can add an enquiry to your file. Apply where your scenario fits the lender's policy.
Fix what you can
Check your credit report for errors, bring lodgements up to date and keep your business account in good order before you apply.
Finance types to look at
- Non-Cashflow / Asset-Backed Finance: Lending assessed on property or asset security rather than trading figures.
- Specialist & Private Finance: Bridging, caveat, private credit and complex situations.
- Refinance & Debt Consolidation: Replace or combine existing business debts into a better structure.