FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the Castor Bay Small Business Loans
Tell me more about Castor Bay Small Business Loans
Castor Bay unsecured loans provides amounts of between $5,000 and $100,000. The terms range between 3 and 24 month and cash flow-friendly repayments which can be made daily or weekly.
What is this Unsecured Loan different from a traditional company loan?
The application to this Small Business Loan in under 10 minutes over the phone, receive an immediate response, and have the funds in your account within 24 hours. Traditional company loans refer to an interest rate per annum plus other fees and charges. The company loan is a cash-based loan and you’ll be aware of the total amount due, which includes any interest, fees or charges. This is then broken down into a daily or weekly amount to be paid back.
What could be the Small Business Loan be used for?
A Small Business Loan can be used to fulfill almost any company need, such as control of cash flow business improvements, advertising to purchase inventory, new equipment, to fund general working capital and so much more. The loan cannot be used to fund personal expenses.
About the Larger Castor Bay Business Loans
What is the Larger Castor Bay Business Loan?
The Larger Business Loan is a larger size of loan that can be used to fund company growth opportunities. Loans range between $100,000 and $500,000 over a fixed term with a maximum of 36 months. Repayments are weekly or fortnightly depending on the flow of cash.
How is the Origination Fee calculated?
The Larger Business Loan has an Origination Fee which is determined at 2.5 percentage of the amount of the loan.
Am I eligible for the Larger Business Loan?
To qualify for a loan of this size, your business needs to be operating for a minimum of 3 years, and have an annual income of $700,000. The applicant must also be a New Zealand Citizen (or Permanent Resident) who is over the age of 18, own a New Zealand business (with a valid NZBN/IRD) and be able to prove at minimum 12 months of continuous trading.
What can I use the funding for?
A larger company loan can be used for nearly all business purpose including business improvements, purchasing new equipment or inventory for general working capital and much more. The loan is not available for personal reasons.
Is the Larger Business Loan one that requires security?
Asset security is required for accessing funds over $150,000. It is usually by way of charge against assets, and may include registration on the PPSR or registering as a caveat.
A personal or director’s guarantee is a commitment to repay credit that is generally in nature rather than specifying the security for a particular asset. The person signing the guarantee is personally liable in the event that the business the borrower fails to repay the debt.
The Personal Property Securities Register (PPSR) is an online central register run by the New Zealand Government. It contains security interests which are registered with respect to personal property (including the assets or goods). The PPSR grants preference over private property assigned in accordance with the date on which a security interest that is registered.
The caveat can be described as a formal document lodged to offer the legal claim on a property.
What exactly is a preapproval without Credit Check?
When you’re applying for a Larger Business Loan of more than $250K we may be able to provide an initial pre-approval in order to smooth out the process. We may be able to do this without credit checks and within 6 hours of your initial application. This pre-approval is made based on an initial evaluation that involves answering a couple of financial well-being checks. It is not an offer or guarantee of finance. A conditional approval is subject an extensive credit evaluation and any offer you receive could be subject to different terms.
Application process
Do I have the right to receive funds?
You may apply for an business loan if you:
- are a New Zealand Citizen (or Permanent Resident)
- are over the age of 18 and own a New Zealand company (with a valid NZBN/IRD)
- must show at least six months of business (for for the unsecured loan $5K – $100K) or 3 years of continuous trading (for the Larger Business Loan $100K - $500K)
How do I apply?
The application process is fast and easy. Just complete the online application in 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 identification details (valid Driver’s Licence) and a valid NZBN/IRD as well as at least 6 months’ worth of bank statements.
For larger loan sizes, you’ll also require:
$100K – $250K: Details of application, including credit consent, 6-12 months of IRD statements, bank statements (if loan above $150K).
$250K-$500K: Details of the application, including credit consent twelve month bank accounts, the IRD statement Last 2 years’ finalised financial statements, plus interim financial statements for the current year including Aged Payables, Aged Receivables summary.
What speed will I be able to get a decision?
For an unsecured loan ($5K and up) we can often offer an answer within an hour if you apply at quality business hours and you allow us to utilise the bank verification system to immediately verify your bank account information online. If you opt to send us copies of your bank statement, we’ll provide a decision within an business day.
For the Larger Business Loan ($100K up to $500,000) we might be in a position to provide you with a conditional pre-approval within about 6 hours. After you’ve signed your pre-approval, turnaround times are around 2-3 days for final approval, however this may be quicker depending on the specifics of each application. Some deals have been approved in less than 24 hours.
The quickest way to apply is to make sure you apply during normal business hours. Also, let us use the modern bank verification to verify your bank account information online. If you upload the copies of bank statement, it will take a little longer.
What is the time frame to receive the funds?
For the Small Business Loan ($5K to $100K) we usually provide an answer within an hour – as long as you submit your request within standard business timings and you allow us to utilise the advanced bank verification system to immediately verify your bank account information online. If you opt to upload copies of your bank statement, we’ll provide the decision within an business day.
For Larger Business Loans ($100K and up) We may be capable of offer the conditional pre-approval within about six hours. Once you have signed the pre-approval, the turnaround time is approximately 2-3 days to receive final approval, however this could be shorter based upon the circumstances for each application. Certain offers have been approved within less than 24 hours.
The fastest way for you to apply is make sure you apply during standard business hours and let us use the sophisticated bank verification link to check your bank’s information online. If you choose to upload duplicates of your banking accounts, it will take a little longer.
What’s the minimum amount I can borrow?
We provide loans that range from $5,000 to $500,000. When you submit an application for a specific amount we consider a variety of aspects to determine how much we can lend you health of your business as well as the amount of repayments that your company will be able to support. The total amount of your loan will be contingent on the specific circumstances the company.
When you submit an application for a particular amount, we consider a variety of factors to assess the health that is your company as well as the amount of repayments that your company can support. The total amount of your loan will be contingent on the particulars that are unique to your company.
Fees & repayments
How do you charge for an company loan?
When you request our company loan, we will assess the risk assessment for your company and provide you with a tailored offer that includes the loan amount, the terms and interest rates. A business loan is an upfront cost loan which means you know in advance the total amount due, which includes any charges, interest rates or fees.
What is the factor that determines the price I will be charged?
The interest rates on company loans rates depend on a variety of factors including the amount borrowed, what business assets the money are used to purchase, the industry the company is in, how long the business is in operation, whether the company has sufficient cash flow to support the loan, as well as the general well-being as well as creditworthiness company.
What are the charges?
There aren’t any hidden costs for our company loans, and you’ll know precisely how much you be required to pay and at what time, from the first day. There’s no compounding interest and the loan comes with no additional fees (as as you make your payments punctually).
We don’t charge an Application Fee. You are able to make an application for loans without any upfront costs or the obligation to take action.
The Origination Fee includes the expenses associated with the setting up and management of the loan. It is only charged for this cost if you take out the loan. The Origination Fee for us is 2.5% of the amount of loan.
Do I have the option of paying off the loan earlier?
You can repay the entire amount of your advance loan at any time.
If you are deciding to take this route, please talk to one of our helpful business lending professionals. The professionals will offer you with the details of your repayment and an early payment figure. The figure will be calculated as the sum of the principal amount remaining and accrued interest to the time of early payment, plus 1.5 percent of the principal balance and any outstanding fees.
What is the process for repayments?
In order to help you avoid missing repayments and to fit in your cash flow cycle we provide payments that are either weekly or daily. These are automatically deducted from your nominated company account.
Security & privacy
Will my information be protected?
Making sure that your information is secure, and making it clear the ways we gather the information we collect, use, share and ensure the security of your information is crucial and is a crucial aspect of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We use industry recognised encryption techniques to protect your sensitive, personal financial and other data. Our funders are ISO 27001 certified for our dedication to the security of our clients as well as their privacy. We use an advanced bank verification system that allows you to instantly verify your bank account information online to offer an immediate response.
About business loans
What is asset-based borrowing (a secured loan)?
An asset-based loan is when the business owner borrows from an asset they own to obtain a loan. The asset can be an asset belonging to the personal, like the family home or it could be a company asset like a truck or piece of equipment.
The majority of the lenders not just the largest banks, are inclined to guarantee loans against an asset. If you are having difficulty paying back the loan then the asset could be taken over by the lender. In essence it’s an opportunity to secure additional financing using the worth of the asset you already own.
What do I require security to secure a company loan?
For loans that exceed $150K, no asset security is required prior to the loan’s access however, we do need the personal guarantee. If you adhere to your loan commitments (as stated in your loan contract document) Asset security will never be needed. For loans of over $150K typically, you will need the option of a personal guarantee and security in the form of a charge over assets.