FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the Morningside Small Business Loans
Tell me more about Morningside Small Business Loans
Morningside unsecured loans offers the range of $5,000 to $100,000. Terms range from 3 and 24 months. They also offer cash flow friendly repayments which can be made daily or weekly.
What is what makes the Unsecured Loan different from a traditional company loan?
The application for this Small Business Loan in under 10 minutes on the internet or by phone. You will receive an answer within the same day and funds may be in your account within 24 hours. Traditional company loans have an annual interest rate together with additional fees and charges. This business loan is a cash-based loan and you’ll be aware of the total amount to be paid, including any fees, interest or charges. This is then broken down into a daily or weekly installment amount.
What can the Small Business Loan be used for?
The Small Business Loan can be used for almost every company use, including control of cash flow company remodels and marketing for purchasing inventory or new equipment, to fund general working capital, and much more. The loan cannot be used for personal purposes.
About larger Morningside Business Loans
What is the Larger Morningside Business Loan?
The Larger Business Loan is a larger size loan to aid in company expansion opportunities. Loans are between $100,000 and $500,000 over a fixed term for up to 36 months. Repayments are scheduled weekly or fortnightly to work with the flow of cash.
How’s the Origination Fee determined?
This Larger Business Loan has an Origination Fee which is calculated at 2.5% of the loan amount.
Do I qualify for the Larger Business Loan?
To be eligible for a loan that is this large the company needs to be in operation for at least 3 years, and have an annual income of at least $700,000. You must be a New Zealand Citizen (or Permanent Resident) over 18 years as well as own a New Zealand company (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 business loan can be used to fund almost all business use, including business renovations, to purchase equipment or inventory, as general working capital and so much more. The loan cannot be used to fund personal expenses.
Is the Larger Business Loan one that requires security?
Asset security is required for accessing funds over $150,000. It is usually by taking a charge on assets, which could also include registration with the PPSR or registering as a caveat.
A director’s or personal ensure is a guarantee to repay credit that is generally in nature rather than specifying security over a particular asset. The person signing the guarantee is personally responsible if the business creditor is unable to make the repayment.
The Personal Property Securities Register (PPSR) is a central, national online register run by the New Zealand Government. It lists security interests that are which are registered with respect to personal property (including goods or assets). The PPSR allows preference over private property granted depending on the date that a registration of a security interest.
Caveats are legal form of document to offer an official notice of a claim to a property.
What is a pre-approval that does not require Credit Check?
When you’re applying for the Larger Business Loan that exceeds $250K it is possible to offer an initial pre-approval that will help make the process. We could be able to do this without a credit check and within six hours of your initial application. The pre-approval is based upon a preliminary assessment which includes the answer to a series of financial well-being checks. It’s not an offer of credit or guarantee of financing. Unconditional approval is subject to an assessment of your creditworthiness and any offer that you are offered could have different conditions.
Application process
Do I qualify for funds?
You are eligible to apply for an company loan if you
- are a New Zealand Citizen (or Permanent Resident)
- are over 18 years, own a New Zealand company (with a valid NZBN/IRD)
- can demonstrate at least 6 months of trading (for the unsecured loan $5K – $100K) or 3 years of continuous trading (for the Larger Business Loan $100K up to $500K)
How do I apply?
The application process is fast and simple. Just complete the online application within a few minutes and an experienced company loan specialist will be in touch to help you.
To apply for up to $100,000 you’ll need the right identification documents (valid Driver’s License), a valid NZBN/IRD as well as at least six months worth of bank statements.
For larger loan sizes, you’ll require:
$100K to $250K: Information about the application including credit consent, 6 – 12 months of bank statements, IRD statement (if credit is over $150K).
$250K to $500K: Details of the application, including credit consent and 12 months bank statement, an IRD statements, last 2 years finalised financial statements, as well as interim financials for the current financial year as well as Aged Payables and Receivables reports.
How quickly will I receive a decision?
For an unsecured loan ($5K or more) we typically provide an answer within an hour if you make your application during quality company times and permit us to use the advanced bank verification system to instantly verify your bank details online. If you choose to send us copies of your bank statements , we’ll be able to provide a decision in as little as 1 business day.
For Larger Business Loans ($100K and up) we could be capable of provide you with a conditional pre-approval within six hours. Once you have signed the pre-approval form, it will take around 2-3 days for final approval. However, this can be quicker based on the particular circumstances of each application. Certain agreements have been approved within the space of 24 hours.
The fastest way would be to make sure you apply during standard company hours. Also, permit us to use the advance bank verification link to check your bank’s information online. If you opt to upload duplicates of your banking statements , it will take a little longer.
How soon will I receive the funds?
For the Small Business Loan ($5K up to $100,000) we typically provide an answer within one hour – provided you submit your request at standard business hours and let us utilise the advanced bank verification system link to immediately verify your bank account information online. If you want to upload copies of your banking statements we can provide the decision within one business day.
For Larger Business Loans ($100K to $500K) We may be in a position to offer the conditional pre-approval in around six hours. Once you have signed the pre-approval, the turnaround time is approximately 2-3 days to receive final approval, however this can be faster depending on the particular circumstances of each application. Certain agreements have been approved in less than 24 hours.
The fastest method is to ensure you apply during standard business hours. You can also allow us to use the modern bank verification to instantly verify your bank information online. If you send us duplicates of your banking statement, it takes a bit longer.
What’s the minimum amount I can borrow?
We offer loans that range from $5,000 and $500,000. If you apply for a specific amount we consider a variety of elements for determining your well-being for your company and the level of the repayments your business can support. The total amount of your loan will depend on the specifics that are unique to your business.
If you apply for a set amount, we consider a variety of factors to determine the well-being for your business as well as the amount of payments your business can support. The total amount of your loan will be determined by the particulars for your business.
Fees & repayments
How much do you charge for the cost of a business loan?
When you request business loans with us business financing, we’ll assess the risk assessment the business and provide you with a customised offer including loan amount, term and the interest rates. It is a company loan is an upfront-priced loan therefore you will know in advance the total amount to be paid, including any costs, fees, or interest rates.
What determines the rate that I pay?
The interest rates on business loans rates depend on several variables like the amount to be that is borrowed, what business assets the funds are used to purchase, the industry the company operates in, how long the company has been operating as well as in the event that the company has sufficient cash flow to pay for the loan, and general well-being or creditworthiness of the business.
What are the charges?
There are no hidden costs for our business loans. You’ll know precisely what it is that you need to pay and when, from the very first day. There’s no compounding interest and no additional fees (as as long as you pay your payments in time).
We don’t charge an Application Fee. You are able to request a credit loan with without any upfront costs or obligation to proceed.
The Origination Fee covers the expenses involved with setting up and managing the loan. The only way to pay this fee if you proceed with the loan. The Origination Fee for us is 2.5 percent of the loan amount.
Can I pay out the loan early?
You may choose to pay back all of your loan early at any time.
If you choose to do this please speak to our friendly business lending professionals. The professionals will offer you with details for repayment as well as an early payout amount. It will be calculated using the total of the principal balance and the accrued interest up to the time of early payment, plus 1.5% of the principal balance and any fees that remain unpaid.
What are the repayment methods?
To help you avoid missing payments and to work with your cash flow cycle we offer repayments either daily or weekly. These are automatically withdrawn from your nominated business account.
Security & privacy
Will my data be secure?
Making sure that your information is secure, and knowing how we collect the information we collect, use, share and safeguard your data, is vital and an integral element of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We utilise industry-recognised encryption standards to secure your personal, sensitive financial and other data. Our funders are ISO 27001 qualified for our commitment to the security of our customers as well as their security. We utilise a sophisticated banking verification system to instantly verify your bank account details online, allowing us to provide an immediate response.
About business loans
How do you define asset-based lending (a secured loan)?
An asset-based loan is when an company owner utilises an asset that they own to make a loan. The asset can be either a personal asset like the family home or an business asset such as a vehicle or piece of equipment.
The majority of banks, even the big banks, tend to secure loans against an asset. If you have trouble paying back the loan, then the asset might be transferred to the lender. In essence it’s means of securing new funding taking advantage of the value of what you already own.
Should I require security for an company loan?
For loans that exceed $150,000, there is no requirement for asset security upfront to access the money but we do require the personal guarantee. So long as you comply with your loan commitments (as stipulated in your loan contract document) and you are able to meet your obligations, asset security will never be needed. If you take out loans in excess of $150,000 generally there is the option of a personal ensure and security in the form of an asset charge.