Here are some of the frequently asked questions we often hear about business loans. If you're wondering about the application process, what our lenders are looking for, or how it works, you can find the answer on this page. If you have a question that isn't answered, why not get in touch with a Business Finance Specialist or email us directly at firstname.lastname@example.orgGet business finance
We often handle lots of questions regarding business loans and how to apply but if you've got a question that we haven't listed, why not get in touch with our team today on email@example.com We're always happy to help.
Our fastest case was completed in 18 minutes, from initial enquiry to funds in the business's bank account. Our record from enquiry to approval is 20 seconds.
In our experience, the biggest factor in how quickly you’ll get finance is you. Most lenders will reply quickly (within 24 hours), and your dedicated account manager will work hard to keep things moving. If you’ve got all the documentation ready, it’s often possible to get the deal done within a day or two.
First, you’ll need to give us the key details about your business and what you’re looking for. This will only take a few minutes, and you can do it on our website or give us a call.
Once you’ve decided which lender(s) you’d like us to approach, the application time varies depending on the product and lender you’re dealing with – but it always helps if you’ve prepared in advance!
Lenders we work with are much faster than the banks
Takes seconds to see your options
Offers back within 24–48 hours for most cases
Money in account within days if you’ve got documents ready
There are many different factors that affect how much you can get approved for when applying for a business loan, and each provider has their own process for determining eligibility.
The lender will consider various factors to find out how much your business is eligible for, and it’s important to know that you won’t be accepted for a principle you can’t afford to repay. As a rule of thumb, the maximum most providers will lend is about 10-30% of your annual turnover.
Your business's security (e.g. invoices or machinery) and profits are factored in too, and if you're looking to borrow a significant percentage of your turnover, lenders will want to see that borrowing money now will mean you generate more cash in the future.
You’re welcome to go direct to a lender if you have one in mind — but we're here to make the process of finding a business loan faster and easier for you.
We work with dozens of the UK's best lenders, so we can match you to the one that suits your requirements best
We work with these lenders every day, so we know what they're looking for, and can pick up the phone to them whenever you need
Not all lenders take direct applications, so to access their products you’ll need to go through a broker like us
In most cases, going through Funding Options doesn't add to the cost, and you'll get the same interest rate — or better — than going it alone
There are many ways of paying back a loan or line of credit, and the type of repayment depends on the lender. Some lenders will give you a repayment schedule with fixed monthly instalments, while others might be more flexible and accept early repayments.
Often, there’s a fixed amount you have to pay back, but sometimes the repayment can vary, depending on the distribution of interest.
Some lenders allow you to make early repayments without charging a prepayment penalty. However, it’s important to bear in mind that there might be extra costs if you decide to make early repayments, or even pay back all at once.
The best way to get an accurate estimate of how you can repay is to make an application with us — we can give more detailed information once we’ve found you the business finance that’s right for you.
No, here at Funding Options, we offer a no-obligation service which means even if you do get an offer approved for your business loan, you don’t have to move forward with it.
It’s only when you’ve signed the contracts and have drawn down that you’ll then have to proceed as fees will usually be involved at this point. If you want some more time or need to consider your business needs for longer, it is worth noting that your loan approval will be valid for 30 days so you have time to consider the right options for you and your business
When you fill in the form on our website, you'll be automatically matched with more than 70 lenders by our highly rated service. Whether you’re looking for business loans, commercial mortgages, invoice financing, asset leasing, growth finance or something else, we can help. We provide you a list of all the funding options that best suit your needs, ranked by match score. It takes minutes, there’s no obligation, and it’s easy to use.
In some cases, we'll call you to get a bit more information about your business and accurately assess your request. We’ll explain what the next steps are, and we're here to help you throughout the process.
Even if you get referred straight to a lender, you can talk to us at any time ― we’ll guide you through the application process and give you all the information you need to make the right decision for your business.
Since there's a wide range of lenders offering business loans, there are also a lot of different interest rates. These interest rates vary from lender to lender, and also depend on the specifics of your business circumstances.
For standard products like secured loans, mortgages and invoice finance, the big banks are hard to beat on price because they’re the biggest lenders in the market with huge economies of scale. But another of the reasons they’re among the cheapest finance providers is because they won’t deal with businesses they perceive as high risk — which is why many businesses get turned down.
Having said that, we can often get finance for businesses cheaper than the banks, because we work with a wide range of lenders that are suitable for companies in various situations outside the banks' typical criteria. In other words, finding a better fit for your business can often bring the cost down.
It's also important to note that many of these lenders will require less security than the high street banks, particularly for loan sizes under £300,000.
Many alternative lenders may also specialise in lending to businesses where there isn't as much information available (e.g. you haven’t been trading that long, or perhaps there isn’t any security available), or are serving businesses that the banks can't help.
Signing up on our website, seeing your funding options, and talking to one of our Business Finance Specialists won’t have an effect on your credit score. However, many of the lenders we work with require a credit check as a normal part of their application process. For this reason, we may ask for your ‘permission to search’ to pass on to a lender in order to speed up your application and make the process as straightforward for you as possible.
You will never be credit checked by a lender we work with unless you have given your explicit consent. Personal credit checks are highly regulated, and you have rights as an individual for your personal data to be protected.
If you have any questions about credit checks and permission to search in relation to your finance enquiry, one of our team will be happy to discuss it further with you.
A personal guarantee is an agreement between you and a lender that you’re personally responsible for the loan or line of credit if your business defaults on payments. Lenders sometimes ask you to give a personal guarantee as additional security — which means they can pursue you personally if your business defaults.
You can find out more about personal guarantees and why you might consider giving one here.
People often confuse personal guarantees with offering security on their home – while both are common ways to secure business finance, they’re not the same thing. Often, lenders want to know if you’re a homeowner because that means you’ve been through due diligence previously (in order to get a mortgage, for example) – it doesn’t necessarily mean they want a charge over your home.
Quite simply, if you’re a UK homeowner it’s often faster and easier for the lender to do their due diligence — and that’s why they want to know. There are still lots of options for non-homeowners though.
While you don’t have to offer a personal guarantee, for some businesses it can make the difference between getting finance and being rejected. Fundamentally, a personal guarantee means you agree to do your best to repay the money if things don’t go to plan.
Please note, you should always read the specific terms of a personal guarantee before agreeing to anything, and you might also want to talk to a qualified lawyer.
In our experience, the main factor that affects your future borrowing is you.
When you pay back a business loan on time, your credit score might get better because it proves that you’re reliable, which in turn could have a positive affect on future loan applications. On the other hand, if your business defaults on repayments, it could harm your chances for future borrowing because lenders will see you as higher-risk.
It's also not a good idea to apply for lots of credit all at once, because this may harm your credit score. This is one reason you may choose to work with Funding Options — we can help you narrow down your options quickly, so there's no need to apply to lots of different lenders on your own.
We’re specialists in finding the right lender for your business. Our smart technology will compare up to 120+ lenders and match you with the right finance options for your needs. We work with major high street banks, challenger banks, independent lenders and smaller niche altfi specialists.
Each provider is carefully selected following a due diligence process and a trial period, to ensure our panel represents the industry-leading lenders from each specialist area. We're actively doing business with the lenders on our panel, and continually reassess performance to make sure our customers receive the best service available. Quite simply, if a lender isn't delivering a great service to our customers, we will stop working with them.
Using our service is completely free and no-obligation, and we don't charge our customers a fee. You can use our matching tool, look at your options, or speak to one of our Business Finance Specialists with no strings attached. If you decide to go ahead, and a lender accepts your application for finance, they pay us a commission based on our standard terms. Normally, the cost to our customers is the same as if they’d gone direct to the lender.
We’re happy to disclose further commission details on request – if there’s anything else you’d like to know, feel free to get in touch.
Profit and loss is one of the factors lenders will look at when assessing your loan application. The profit and loss statement summarises revenues and expenses of your company during a fiscal quarter of the year. With these records, the lender can get a bigger picture of your company’s ability to generate profit.
Along with the balance sheet and the cash flow statement, the profit and loss statement is one of the standard financial statements that a lender may want to see.
According to the Companies Act 2006, every company registered in the UK is obligated to provide financial documentation to Companies House every year. These accounting records usually contain:
all money received and expended by the company
a record of all assets and liabilities of the company
Sometimes, filed accounts are delivered by an accountant on behalf of the business owner ― if you haven’t heard of filed accounts before, your accountant can give you more information, or you can find out more on the Government's website.
If you decide to go ahead with one of the lenders we work with, you’ll usually have to provide documents like recent bank statements for the assessment of your application. We'll usually ask for your docs beforehand to assess your request as accurately as possible — then, if you decide to go ahead, we'll pass them on to the lender with your permission.
The best way to send us (or a lender) your bank statements and other docs is as a PDF (portable document format) file.
To get your bank statements as PDFs, you can usually download them from your online banking account. If you’re not sure how to download your statements, get in touch with your bank.
You can then send the PDF documents in an email to your dedicated Business Finance Specialist at Funding Options.
No, we don’t sign NDAs as they make it difficult for us to do our job in terms of referring businesses to lenders.
Thanks to the buy-in from trusted high street lenders, you can use Open Banking banking for your business safely and easily. You’ll need to download an Open Bank app or sign up to a regulated website to benefit from this feature for your business. Open Banking consolidated all your bank accounts and financial information in one place- a great option for businesses wanting to keep an eye on their finances.
Open Banking is completely safe and can be a great option for businesses as it allows you to share your banking information with providers in a secure way. Open Banking is when your business’s financial information is ‘opened’ up to trusted third parties, in the hope that this innovative new way to introduce more choice into the financial sector for both businesses and personal bank users.
Opening Banking lets businesses compare deals and make business-led decisions using a single platform. As it’s a relatively modern way to bank, we know there are a few myths around Open Banking that we’ve previously tackled. Some of the more popular myths are that your funds could be at risk or your personal data could be shared without your consent- both of which aren’t true.
Yes, you can. If you’ve taken out a Coronavirus Business Loan Interruption Scheme (CBILS) or the Bounce Back Loan (BBLS) you can apply for the Recovery Loan Scheme (RLS) too. As long as your business meets the eligibility criteria.
The RLS, introduced by Chancellor Rishi Sunak to replace the CBILS and BBLS, offers businesses another funding option to help them trade, plan and grow after the disruption caused by the Coronavirus. It’s available to businesses of any size and the amount you can borrow to help your company recover will be dependent on the individual lender. There are some businesses that aren’t able to apply such as banks, insurance companies and public-sector schools.
If your business is eligible to do so, you can take out an RLS and keep your CBILS or BBLS in place, meaning you won’t have to refinance it if you don’t want to.
Yes, you can refinance your CBILS and BBLS whenever you need and with any lender you choose - as long as they consider your business to be eligible. It’s not compulsory, but you also have the option to refinance your CBILS or BBLS with an RLS, giving you the flexibility to consolidate your loan into one repayment plan.
Some lenders will retain the interest on your loan and others won’t, it depends on who your CBILS/BBLS is with and their payout process. Before refinancing your CBILS or BBLS, it’s worth checking the interest rate you have in place so you can work out if it’s the best option for your business.
Sadly though, even with access to suitable finance, some businesses will run into problems that can’t be fixed by finding the right lender. There are many situations where taking on more debt isn’t the answer, and it’s crucial to recognise the symptoms of a business in distress.
The Government-backed Money Advice Trust runs the Business Debtline, a valuable resource for businesses in trouble. Whether you need emotional support to cope with the stress of business debt, or you want practical tips for how to change your situation, you’ll find support here.
Disclaimer: Funding Options helps UK firms access business finance, working directly with businesses and their trusted advisors. We are a credit broker and do not provide loans ourselves. All finance and quotes are subject to status and income. Applicants must be aged 18 and over and terms and conditions apply. Guarantees and Indemnities may be required. Funding Options can introduce applicants to a number of providers based on the applicants' circumstances and creditworthiness. We are also able to make insurance introductions. Funding Options may receive a commission or finder’s fee for effecting such finance and insurance introductions.
*Eligibility criteria apply - see Tide website for full details.
Funding Options Ltd is incorporated and registered in England and Wales with company number 07739337 and registered office at 4th Floor The Featherstone Building, 66 City Road, London, EC1Y 2AL.
© Funding Options Ltd · Authorised and Regulated by the Financial Conduct Authority · Reference Number 727867