FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
More about the Karaka Small Business Loans
Let me know more about Karaka Small Business Loans
Karaka unsecured loans provides amounts between $5,000 and $100,000 with terms between 3 and 24 month and cash flow-friendly repayments that are either daily or weekly.
What makes what makes the Unsecured Loan different from an ordinary company loan?
It is possible to apply to get your Small Business Loan in under 10 minutes online or over the phone. You’ll get an answer within the same day and the funds could be on your account within 24 hours. Traditional business loans have an interest rate per annum as well as other fees and charges. The business loan is an upfront priced loan and you’ll know in advance the amount you will have to pay, including any fees, interest or charges. Then, it is divided into a daily or weekly payment amount.
What can you use the Small Business Loan be used for?
A Small Business Loan can be used for virtually any business use, including the management of cash flow, company remodeling, marketing for purchasing inventory or new equipment, for general working capital, and much more. The loan is not available to fund personal expenses.
About larger Karaka Business Loans
What is the Larger Karaka Business Loan?
The Larger Business Loan is a larger loan size to support business growth opportunities. Loans are between $100,000 and $500,000 with a term fixed that can last up to 36 months. The repayments are made weekly or fortnightly to work with the flow of cash.
How is the Origination Fee determined?
This Larger Business Loan has an Origination Fee which is calculated at 2.5 percentage of the loan amount.
Can I get the Larger Business Loan?
To be eligible for a credit in this amount, your business needs to have been trading for at least 3 years and generate an annual revenue of at least $700K. The applicant must also be a New Zealand Citizen (or Permanent Resident) over 18 years as well as own a New Zealand business (with a valid NZBN/IRD) and be able of proving at the least 12 months of operating.
How can the funding be used for?
A larger company loan can be used to fund almost all company reason, such as business renovations, to purchase inventory or new equipment as well as for general working capital, and much more. The loan is not available for personal use.
Is the Larger Business Loan a secured loan?
Asset security is necessary for funding of more than $150,000. It’s by taking a charge against assets, which could also be registered on the PPSR or the registration of a caveat.
A director’s or personal ensure is a guarantee to pay off a credit line that is generally based rather than specifying the security for a particular asset. The person who signs the guarantee is personally responsible if the business creditor 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 lists security interests that are which are registered with respect to personal property (including the assets or goods). The PPSR gives the priority of personal property assigned according to the date the security interest has been registered.
An affidavit is an official document that is filed to offer the public notice of a legal claim on a property.
What is a pre-approval without Credit Check?
If you’re seeking larger company loans of $250,000 or more, we may offer an initial pre-approval that will help smooth out the process. It is possible to get this done without a credit check, and within six hours of your initial application. The pre-approval process is based on an initial evaluation that involves you answering some financial health checks. It is not an offer of credit or guarantee of credit. Unconditional approval is subject to an assessment of your creditworthiness and any offer that you might receive could have different conditions.
Are I eligible for funding?
You may apply for an company loan if you:
- are a New Zealand Citizen (or Permanent Resident)
- are over 18 years, have a New Zealand business (with a valid NZBN/IRD)
- you must demonstrate at minimum 6 months worth of trade (for you to qualify for unsecured loan $5K – $100K) or three years of trading (for the Larger Business Loan $100K up to $500K)
How do I apply?
The application process is quick and easy. Simply complete the online form in just a few minutes, and a dedicated business loan specialist will call you to guide you through the process.
To be eligible for up to $100,000, you’ll need proof of identity (valid Driver’s Licence) along with a valid NZBN/IRD and at least 6 months’ worth of bank statements.
Otherwise, for larger loan sizes, you’ll also require:
$100K-$250K: Information about the application including credit approval, 6-12 months of IRD statements, bank statements (if you have a loan of more than $150K).
$250K – $500K: Information on the application including credit consent, 12 months of bank statements, IRD statements and the last two years’ finalised financial statements, plus interim financials for the current financial year such as age-related payables and aged Receivables summaries.
How soon will I hear a decision?
For an unsecured loan ($5K up to $100,000) We can usually offer an answer in just one hour if you apply in quality company times and permit us to utilise the advanced bank verification system link to instantly verify your bank information online. If you opt to upload copies of your bank statements we can provide an answer within the span of one business day.
For the Larger Business Loan ($100K to $500K) we may be likely to offer you with pre-approval conditional to your application within six hours. After you’ve signed your pre-approval document, you will need to wait approximately 2-3 days to receive final approval. However, it could be faster based on the particular circumstances of each application. Certain deals have been approved within less than 24 hours.
The fastest way for you to apply is ensure you apply during normal company hours, and permit us to use the modern bank verification link to instantly check your bank’s information online. If you upload the copies of bank accounts, it will take a little longer.
What is the time frame to receive the money?
For the Small Business Loan ($5K or more) We can usually offer an answer in just one hour if you make your application within standard business time and let us use the bank verification system to instantly verify your bank details online. If you want to upload copies of your banking statements we can offer an answer in as little as the span of one business day.
For Larger Business Loans ($100K and up) we might be capable of offer you with conditional pre-approval in about 6 hours. Once you’ve signed the pre-approval, turnaround times are approximately 2-3 days to receive final approval. However, this may be quicker depending upon the circumstances for each application. Certain transactions have received approval in just 24 hours.
The fastest way is to ensure you apply during normal business hours. You can also permit us to use the sophisticated bank verification link to check your bank’s information online. If you send us the copies of bank accounts, it takes a bit longer.
How much can I borrow?
We provide loans that range from $5,000 and $500,000. When you submit an application for a specific amount we look at a variety of aspects for determining your well-being that is your company and the extent of payments your company can afford. The amount you receive from the loan will be determined by the particular circumstances the business.
If you apply for a specific amount we take into consideration a variety of variables to determine how much we can lend you such as health of your business and the level of the repayments your business is able to afford. The total amount of your loan will depend on the particulars the business.
Fees & repayments
How much do you charge for a business loan?
If you decide to make an application for the company loan, we will assess the risk assessment that you have for your company and provide you with a tailored offer including the amount of the loan, the duration and interest rates. The company loan is an upfront-priced loan which means you be aware of the total amount you will have to pay, including charges, interest rates or fees.
What determines the amount I pay?
Interest rates for company loans rates depend on a variety of variables like the amount to be borrowed, what business assets the money will be used for and the sector the business operates in, how long the business has been running, what percentage of the business has sufficient cash flow to fund the loan, and general well-being or financial standing of the business.
What are the charges?
There are no hidden fees for our business loans, and you’ll know precisely what it is that you need to pay, and when, right from day one. There’s no compounding interest, and there are no additional charges (as long as you are able to make your payments punctually).
We don’t charge an Application Fee. You can make an application for loans with without any upfront costs or commitment to apply.
The Origination Fee is the cost associated with setting up and managing the loan. This is only a cost if you take out the loan. The Origination Fee for us is 2.5 percentage of the loan amount.
Do I have the option of paying off the loan earlier?
You can choose to repay the entire amount of your loan at any point in time.
If you decide to do this please speak to our friendly company loans specialists. They’ll provide you with details for repayment along with an early payout estimate. This is calculated as the total of the remaining principal amount and any accrued interest at the time of the early payout plus 1.5 percent of the principal balance and any fees that remain unpaid.
How do you make repayments work?
To make sure you do not miss payment dates and to align with your cash flow cycle we offer repayments either daily or weekly. These are automatically deducted from your company account.
Security & privacy
Will my information be secure?
Protecting your information, and making it clear how we collect, use, exchange and protect your information, is of paramount importance and a vital aspect of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We employ industry-recognised encryption techniques to protect your personal, sensitive and financial data and our funders are ISO 27001 qualified for our commitment to protecting the security of customers and privacy. We utilise a sophisticated bank verification system link to immediately verify your bank account information online. This allows us 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 utilises an asset they own to get the funds for a loan. The asset could be a personal asset like the family home, or a business property like a truck as well as a piece of machine.
The majority of lenders, even the banks with the biggest size, prefer to secure loans against an asset. If you have trouble paying back the loan, then the asset could be sold by the lender. In essence, it’s a way of securing new financing by taking advantage of the value of what you already own.
What do I require security to secure an business loan?
For loans that exceed $150,000, the requirement for asset security is not required before you are able to access the money but we require a personal guarantee. require an individual guarantee. If you adhere to the terms of your loan (as stipulated in your loan contract document) the security of assets is not needed. If you take out loans in excess of $150K typically, you will need a personal ensure and security in the form charges on assets.