Author: LoanOne

Guide to taking out a Personal Loans

taking a personal loan

If you are looking to apply for a personal loan but want to know more, then this guide will help you to find out how they work and how you can apply.

Whether you are wanting to take out a personal loan put a down payment on your new car, to pay for that much needed holiday or simply because your big day has just been announced, there are so many personal loans and lenders to choose from. This guide will help you to choose the right one for your needs and circumstances.

How do personal loans work?

Personal loans work is a similar way to any other type of loan. Put simply, you borrow an amount of money from either a bank or an alternative lender in order to pay for the things that you need to, whether that is for leisure or for daily expenses that you have fallen short on. The terms and agreement from the lender will determine if you pay this loan back in either monthly, fortnightly or weekly payments.

A personal loan will typically assist you in filing either a short-term or long-term demand for financial assistance. Once you have applied for a loan, the lender will then assess your suitability of the loan based on the guidelines they have in place, and if you are successful in your application, the lender will then send you the funds.
The repayments that you make on the loan will include the total amount of the loan, along with any fee and interest.
 

Comparison:

Determining the right personal loan for your situation is the first step of the process, however, this is not a straightforward as picking the first lender and the first loan terms that you stumble across. You must first choose the type of personal loan that you wish you opt for.

The two main types of personal loans are secured loans and unsecured loans.

  • Secured Loans: Secured Personal Loans are ones that you are required to attach an asset as collateral such as your home or vehicle. This is used as security for the repayment of the loan that must be forfeited in the event that you do not make repayments on the loan.
  • Generally, secured loans have a lower risk for lenders and therefore the rates they offer are lower.

  • Unsecured Loans: If you wish to obtain funds from a lender without expending your assets as collateral, you may wish to consider an unsecured loan. As the risk associated with offering a loan for lenders is much greater as they cannot claim any assets to recover for their losses, the interest rates that they offer with these loans are often higher. However, with this, you are able to have greater flexibility in the way in which you use your loan.

After you have determined the type of personal loan that meets your requirements and you wish you begin the application process, here are the ways in which you can compare the various personal loan offers from lenders:

  • The loan amount: What is the minimum and maximum amount that your choice of lenders allows you to apply for and is it enough to finance your needs?
  • The loan terms: What are the minimum and maximum loan terms? Loan terms can vary greatly between 1 and 7 years, however, this will depend on the lender and their guidelines.
  • The fees: Inquire about the upfront fees that you will be required to pay such as an application or sign up fees, along with any ongoing fees such as monthly or annual fees. These fees will be included in the amount of your loan.
  • The interest rates: Check if the interest rate is fixed or variable.
  • The repayments: Assess if you are able to select from either weekly, fortnightly or monthly repayments. It is also advised that you see if you can make additional repayments without incurring an additional fee or if you can repay the loan before the term ends without incurring a penalty.

 

Eligibility:

Lenders have a set of guidelines that are put in place for personal loan eligibility. This can include, but is not limited to any of the following as each lender will have their own criteria:

  • Age: In order to apply for a loan in Australia you must be over 18 years of age. However, some lenders require applicants to be over 21 years of age.
  • Income: Some lenders require that you earn over a set amount in order to be eligible for a loan.
  • Employment: Most lenders require applicants to be employed, however, there are some that will consider and assess unemployed applicants.
  • Residency: For most lenders, you must either be an Australian citizen or be a permanent resident to be eligible, however, there are some lenders that may consider temporary residents.

It is important to note even if you meet the requirements for a loan that has been set out by the lender, you will not be approved for the loan unless you have provided proof that you can afford to make the repayments. Lenders will determine this by assessing your income, cash flow, previous and any outstanding debts and the stability of your employment.
 

Application:

Each lender will have varying application process, however, there is a list of documents of information that you will be required to provide, and may include any number of the following:
You will need to provide identification in the form of either a driver’s license, passport or another mode of photo ID.

You must also provide proof of income. Depending on the lender, you will be required to provide payslips from the last 3-6 months, bank statements, and if you are self employed, at least 2 years of tax returns.
Other relevant financial documents. If you have any other outstanding debts, you will need to provide the statements on these accounts.
 

Approval:

Depending on the lender, you will either be given an answer on approval on the same day, while it may take up to a few days for other lenders. Generally, there are two types of approval.

The first is conditional approval. This type of approval usually takes a shorter amount of time however, it is only given on the condition that you offer more information. This may include additional payslips or other documents that are related to either your assets or outstanding debts. These conditions are in place for the lender to make more informed decisions on lending.

The next is full approval. This is given when you have offered enough information to the lender to make the decision to lend you finances and has approved your loan application.
 

Repayment:

Many lenders will allow you to select your repayment structure whether that is weekly, fortnightly or monthly repayments. Typically, the more often that you make repayments on the loan, the less interest you will incur.
 

The LoanOne Difference

LoanOne personal loans are one the safest and fastest ways in Australia to secure a personal loan. Whether you need the money to put a down payment on your new car, you have run into a family emergency or you simply need the money to stay on top of your daily living expenses, LoanOne personal loans are your fast, hassle-free and secure way to getting your hands on some quick money.

With LoanOne, you can apply for personal loan amounts from $2,100 to $8,000 with 12 month terms and the best part is that the application process won’t take you longer than 5 minutes.

With LoanOne, get fast, simple and safe loans!
Fill in our 5 minute online loan application today!

The Types of Loans Fall Under the NCCP Act

NCCP Act

What is the NCCP Act?

The National Consumer Credit, or NCCP, is a legislation that is designed to protect consumers and ensures both ethical and professional standards in the finance industry, through the National Credit Code (NCC).

The NCCP is regulated and enforced by The Australian Securities & Investments Commission (ASIC) in accordance with the NCC.

The NCCP states that both lenders and mortgage brokers must hold a credit licence or must be registered as an authorised credit representative and must adhere to the rules that are set out in the NCCP Act.

What loan types are regulated?

Generally, almost all home loans and applications are regulated under the NCCP Act.

Although the rules that are associated with this are complicated, a loan should meet the following conditions:

  • The borrower is a natural person
  • A charge has been made for providing the credit
  • The provider of credit provides the credit through the course of a business
  • The credit is provided completely or largely;

These conditions signify that most standard home loans are regulated in accordance with the NCCP Act.

What loan types are unregulated:

There are some exceptions to loan types that are not regulated under the NCCP Act. Unregulated home loans include:

  • Loans that are in the name of a company; not a natural person
  • Loans that are predominantly used to invest in commercial property, shares or a business.
  • Unsecured loans where the applicant for the loan is a corporate entity and the purpose of the loan correlates to commercial or business purposes.

The process of applying for a home loan:

Upon applying for a loan with a lender or mortgage broker, they must follow the specific processes that have been set out in the NCCP Act.

  1. Enquires: Your chosen mortgage broker must make enquiries to your current financial position, requirements and any objectives that you may have.
  2. Verification: The mortgage broker must take the necessary steps to verify your financial position.
  3. Preliminary assessment: After all of the relevant information has been gathered from the previous steps. The broker must conduct a preliminary assessment of the loans that are best suited to you before recommending them to you.

What does ‘not unsuitable’ mean?

In accordance with the NCCP Act, the mortgage broker or lender must provide you with a loan that is not unsuitable.

A loan is deemed as not unsuitable by the ASIC if:

  • The loan meets your specific requirements and objectives
  • You have the ability to repay the loan without enduring considerable financial hardship

The term ‘not unsuitable’ was selected as it places the responsibility on the applicant of the loan to prove that the loan was unsuitable, rather that be the responsibility of the lender to prove that the loan was suitable.

Can’t I just be told which lender and options are best?

Often, many applicants of loans will want to know the lender that they should apply with, along with the interest rate that they will receive, before they have undergone the first steps properly.

It is not possible to recommend a lender, or be given an interest rate, without understanding an applicant entire situation and the supporting documents as it is against the NCCP Act. Without this information, the applicant cannot be given accurate information.

What about low doc loans?

In accordance with the NCCP Act, both lenders and mortgage brokers are required to take the necessary and reasonable steps to verify a loan applicants financial position, however, this is contrary to the concept of a low doc loan, where the applicant does not need to provide evidence of their income.

In order for lenders to work around this issue, they have created an ‘alternative verification’ method.

By an applicant only providing some documents as supporting evidence to their income, the lenders are able to fulfill their obligation in accordance with the NCCP Act without the requirements of tax returns or financial statements.

The documents that lenders most commonly ask for are:

  • BAS Statement: The lender may request a 12-month Business Activity Statement (BAS) to estimate the applicant’s income.
  • Trading Statements: The lender may request for bank statements from the previous 6 months from the business to estimate the applicant’s income.
  • Accountants letter: The lender may have an accountant letter template where they require the applicant’s accountant to sign that will confirm their income.

How to Get Your Small Business Loan Approved

business loan online

Getting approved for a business loan is a large hurdle that many small businesses have to face and this is mainly due to the rigorous lending guidelines that big banks stick to. However, obtaining finance from an alternative lender is often an essential and attractive means for small businesses to start, begin to grow and expand or simply for a small business to cover their daily management expenses.

So, what should you include in your small business loan application?

When gathering information to incorporate into your loan application, you should aim to answer the following questions:

  • What is the purpose of the small business loan? Lenders will want to know what the loan will be used for, and that you have the management skills and cash flow to pay it back.
  • How much you intend to borrow and over what term? This will help both you and the lender to determine what options are available to you, along with how the loan will match up to your cash flow.
  • How soon will you need the money? If you will require the money in a singular lump sum or in numerous payments?
  • How long will it take you to pay back the loan? This will assist in determining whether your small business has the necessary cash flow to actually pay the loan back, but it will also determine the terms and conditions of the loan repayments.

When composing your small business loan application, you will have to work to boost your odds by standing out from the crowd and displaying that your small business has greater value and potential than other small businesses. A good loan application must convince the lender that the money that you will receive will support your small business in either becoming more profitable, or that this money is essential to its continued operation, along with the information to demonstrate that you will have enough revenue and cash flow to pay the lender back.

5 Things To Do Before You Apply For a Small Business Loan

Despite the fact that applying and securing approval for small business loans can be difficult and stressful at times, the more prepared you are, the better your chances are of getting approved.
Here are our best tips to improve your chances of securing your small business loan.

1. Determine why you need a small business loan:

determine if you need a loan

Many lenders will ask you why your small business needs a loan and your answer will most likely fall into one of these categories.

  • To begin and establish your business.
  • To manage your daily expenses.
  • To grow and expand your business.
  • As a safety cushion.

2. Decide the type of loan that is right for your small business:

Your reason for applying for a loan will dictate the type of loan that your small business will get.

For small businesses that are only just starting up, it is generally nearly impossible to obtain a loan within a company’s first year. Many lenders will require cash flow, along with supporting documents, in order to support the repayment of the loan, which is why so many startups are immediately disqualified from receiving financing.

However, for small businesses with a minimum of a year of cash flow history and revenue evidence, they will have a wider range of options.

3. Decide on the best small business lender:

Small businesses can acquire loans from several lenders including big banks and alternative online lenders.

When looking for the right small business loan lender, approach the selection process just as you would if you were shopping for a car. Seek out lenders that offer the type of loan you are looking for and once you have determined the lenders that are right for your small business, you should compare two or three options that offer similar annual percentage rates, along with their terms.

4. Determine if you qualify for a small business loan:

  • One of the most substantial factors that will determine whether you will qualify for a small business loan is your credit score rating and history.
  • Along with your credit score, most lenders will consider other factors such as the amount of time your business has been in operation.
    Evading payments of loans, having an unresolved debt and the lack of consistent income are all factors that will work against you when applying for a small business loan.
  • If you are currently in the midst of any of these issues, then it is in your best interest to address and resolve as many of these as possible before you begin to apply and take out a loan as it can significantly improve your chances of being approved.
  • Most online and banking lenders will require a minimum annual revenue, and depending on the lender, this amount can range anywhere from $50,000 to $150,000. It is advised that you know yours, along with the minimum a lender requires, before you apply for your small business loan.
  • Examine your business’s financials carefully and thoroughly, especially your cash flow, to evaluate the amount you can sensibly afford to apply towards your loan repayments each month. In order for you to easily and comfortably repay your loan, your small business’s income should be at least 1.25 times the businesses total expenses, ensuring that you include the new loan repayment amount to this total.

5. Gather necessary documents:

Once you have compared your lending options, it is now time to apply for specific loans that fit your small businesses financing needs and that your small business qualifies for.
You are able to apply for multiple small business loans from various lenders within a short time frame, typically within 2 weeks, without inflicting a negative outcome on your credit score and rating.

Depending on your chosen lender, you will be required to present a combination of relevant documents along with your application. These documents may include, but are not limited to:

  • Both the businesses and your personal tax returns.
  • Business and personal bank statements.
  • The business’s financial statements.
  • Relevant business legal documents such as the commercial lease or franchise agreement.

Whether you are applying for a small business loan, big or small, these tips will make the job easier and more successful.

Why LoanOne?

LoanOne knows how Australian small businesses work and provides small business owners with easy, fast funding solutions that will help your small business grow.

The business loans from LoanOne are different to other, traditional business loans as our loans are flexible, paper-free and unnecessary extensive supporting documents are not required. We aim to help businesses who need loans fast!

LoanOne offers businesses:

  • A fast and easy online application and a timely loan approval.
  • The most secure technology that will ensure that any information that you submit online remains strictly confidential.
  • A friendly customer service experience via phone or email.
  • No hidden fees! We have competitive fees that are consistent with financial industry standards and are completely transparent.

With LoanOne, get fast, simple and safe loans! Fill in their 5-minute online application today!

How to Choose the Right Small Business Loan – Same Day Loans?

business man looking for a short term loan

If your small business is in need of a loan, we know that trying to find the right lender for your businesses needs and the right type of loan can be an extremely confusing and complicated process.

When your small business is applying for a loan, it is crucial for you to prepare and develop an in-depth business plan and to fully and transparently inform your chosen lender about the proposed venture. The information that is offered will help the lender to provide you with the right type of finance solution, along with any advice moving forward.

In order for you to make the right decision, you must first answer a few essential questions:

  • How much does your small business need?
  • What will the money be used for?
  • How fast do you need to acquire the money?
  • How long will it take your small business to pay the loan back?
  • How long have you been in business?
  • What is the current financial situation of your small business?
  • How much, if any, collateral are you required to put forward for your loan?

By thoughtfully answering these simple questions, it will help to determine if your small business should seek to pursue a government-backed loan, a loan or line credit from a bank, or, a cash advance, line of credit or a loan from an alternative lender.

If you are unsure of what type of lender is best suited for your small businesses, then we have devised an in depth breakdown of what you must know about each type of lender before applying for your small business loan.

Conventional Bank Loans:

A conventional bank loan, either through a mortgage or a traditional loan, is similar to that of a homebuyers loan, however, they are not offered of secured by a government entity. Finances for a small business are most generally acquired through traditional bank business loans.

One of the biggest benefits of conventional bank loans for small businesses is that they, most often than not, carry low interest rants. Along with this, as no federal agencies are involved in the decision making process, the approval process can generally be much faster. However, these types of conventional bank small business loans typically involve considerably shorter repayment terms and often involve balloon payments. It is also much more difficult for small business to gain approval for these types of conventional bank loans. Even though in recent years, approval rates have increased and improved for small businesses, the big banks only approve marginally more than 20% of the loan requests that they receive. On the other hand, smaller banks approve fewer than half of the loan requests that they receive.

Alternative Lenders:

Alternative loan lenders are especially attractive to small businesses that may not have a particularly excellent financial history as their approval requirements tend to be much less strict and are much more flexible. Alternative lenders usually offer quick and straightforward online applications, typically can make approval decision in just a few hours and can provide small businesses with same day loans.

The benefits of working with an alternative lender are that your small business is not required to have an immaculate financial history, there are only very few restrictions for what the money can be used for, and, the most attractive of all, the loans can be approved almost instantly.

The disadvantage, however, is that the interest rates that are attached to these loans may be somewhat higher than those rates that are charged by the big banks. Alternative loan lenders for small businesses are much more willing to provide small businesses and companies with a loan, even if they do not outstanding credit ratings and this increased risk that these alternative lenders take onboard is simply reflected in the interest rates that they charge.

Risk Assessment:

Conventional banks and alternative lenders will assess your small business’s risk profile when they are considering and revising your loan application. By understanding what lenders look for when they are considering small businesses that are at a high risk will assist you in presenting your business in the most favourable manner.

Generally, lenders will examine:

  • The level and nature of the security of the loan. In other words, what you can offer to give them if you cannot repay the loan, also known as collateral.
  • The businesses ability to make regular, and on time, loan repayments, also known as the cash flow risk.
  • The businesses ability to eventually repay the debt in the allotted time, along with any other debts that the business may have obtained.

As a small business owner, you will need to be able to effectively assess the level of cash flow for the businesses specific circumstances. To a lender, one of the most important factors that is considered when offering a loan is the projected cash flow requirements of the business, as this is the amount of cash that is left after expenses that will repay the loan, not income. This will also exhibit you as an effective manager.

Types of Loans

Loans from conventional lenders such as banks, and alternative lenders offer the following loans for small businesses:

Working Capital Loans:
Working Capital Loans have been designed as only short-term, temporary money solutions for small businesses that require money in order to assist them in running their operations. Working Capital Loans are both attainable from conventional banks and alternative lenders.

One of the largest advantages of obtaining a Working Capital Loan is that it offers small businesses the capability to keep their daily operations running while the seek other processes to increase their revenue.

On the other hand, one of the downsides of obtaining a Working Capital Loan is that they often are attached to higher interest rates and have shorter repayment terms.

Equipment Loans:
Both conventional banks and alternative lenders offer small businesses their own class of equipment loans. These equipment loans offer small businesses money for essential office equipment, such as computers or copy machines, or other necessary equipment such as machinery or tools.

Rather than making large, initial purchase of these items that must be paid upfront, Equipment Loans allow for the business owners of these small businesses to make fixed monthly repayments on these items.

Obtaining an Equipment Loan is advantageous for small businesses as they aid in preserving cash flow and as they do not require any large down payments and some of these items may receive tax write-off benefits.

One benefit of Equipment Loans for small businesses is they are considerably easier to obtain than other types of loans for small businesses as the equipment that is purchased can be used as tangible collateral for the loan.

Merchant cash advance:
Merchant Cash Advance loans are offered to small businesses based on the amount of their monthly credit card transactions. Small businesses can often receive a loan, or cash, advance of up to 125% of their monthly transaction amount.

The terms that are associated with repaying the merchant of a cash advance varies from lender to lender. There are some merchants that take a fixed amount from the business’s account each day, while other lenders will take a percentage of the sales that are made daily to the credit card.

The benefit of a Merchant Cash Advance for small businesses is that they are comparatively easy to obtain, the cash advance can be received in just a couple of days and that loan is repaid to the lender directly from the sales of the credit card.

One of the biggest downsides of Merchant Cash Advance loans is the expense that is associated. The interest on these loans can be as high as 30% per month, however, this number depends on the lender and the original amount that was borrowed.

Lines of Credit:
Similar to that of Capital Loans, lines of credit offer small businesses with the money that is required for their daily cash flow needs. This type of loan is not recommended for larger business purchases and can be available for a range of time spans, anywhere from as short as 90 days and as long as several years.

When obtaining a Line of Credit, small businesses only take the amount that they need and therefore only pay interest on what they actually use, rather than paying interest on the entire amount of the loan. This type of loan generally have longer repayment terms and give small businesses the ability to build up their credit rating, should they make the interest repayments on time.

The disadvantages of Lines of Credit are the added fees that are applied to small businesses that are at risk of building a considerably large amount of debt with this loan option.

Professional Practice Loans:
Professional Practice Loans have specifically been designed for those who provide professional services, such as those small businesses that are in the healthcare sector, offer accounting, services or legal, insurance and veterinary fields of practice. Professional Practice Loans are generally offered to small businesses to purchase a practice, obtaining new equipment or to refinance debt.

Franchise Start-Up Loans:
Franchise Start-Up Loans have been designed for entrepreneurs that require financing in order for them to open up their own franchise businesses. These Franchise Start-Up Loans are offered to small businesses by conventional banks and alternative lenders and the money can be used for working capital, to pay any fee associated with starting up the franchise, to purchase equipment or to build stores or restaurants.

Now that you have got the basics covered, you are more informed and ready to make the decision of which type of loan and provider is right for you and your small business.

Why LoanOne?

Unlike other alternative lenders, LoanOne understands how Australian small businesses work and will provide small business owners with easy, fast funding solutions that will help your business grow.

The business loans from LoanOne are different to other, traditional business loans as the loans that we offer are flexible, paper-free and unnecessary extensive supporting documents are not required. We aim to help businesses who need loans fast!

LoanOne offers businesses:

  • A fast and easy online application and a timely loan approval.
  • The most secure technology that will ensure that any information that you submit online remains strictly confidential.
  • A friendly customer service experience via phone or email.
  • No hidden fees! We have competitive fees that are consistent with financial industry standards and are completely transparent.

With LoanOne, get fast, simple and safe loans!
Fill in our 5 minute online application today!

Fast Cash Loans: Tips for Getting Quick Easy Loans Online

fast cash loans

If you have found yourself strapped for cash and are in the midst of a financial emergency, it is in your best interest to start looking into short term fast cash loans.

Not only you are able to apply for easy loans online without even having to ever leave the comfort of your own home, but the approval for the loan can be given on the same day, as long as you have a steady job, a not too bad credit history and a bank account.

Although taking out an easy loans may seem simple enough to obtain, contrary to popular belief, there is a little more than meets the eye that you should consider when deciding to take out a loan.

To avoid getting burned and ensure that you have chosen the right lender, it is important to consider a few key factors that can make or break your easy cash loan experience.

 

Best Tips for Getting Short Term Loans Australia

Here are our best tips for getting the best short term fast cash loans.

    • If you are concerned about your credit rating and how it can affect your loan, you should seek out lenders that have bad credit considerations for their fast and easy online loans. With LoanOne, applicants with low credit records are still considered for easy loans online. The approval of the loan is based on a combination of various factors including an individual’s income and security.
    • When seeking the right fast cash lender, it is in your best interest to stick to the internet. Even though your local area may have loan vendor options that are openly available to you, it is most likely that they will pale in comparison to the plethora of loan vendors that are available online.
    • Be sure to consider numerous lenders – do not just settle for the first one that you happen to stumble across. There is a common misconception that all fast cash loan lenders are the same, however, in reality, this is not the case. Ensure that you take some time to look through reviews of the lender and customer experiences of a handful of lenders. This is one of the best ways to examine just how different lenders can be; it doesn’t take long and can save you a lot of trouble in the long run.
    • With so many fast cash lenders that are desperate to attract potential customers, it can mean that you will be offered a lot of discounts in terms of your interest rates and applicable fees. With this in mind, it is important to remember to not rush the selection process. Do your research and ensure that you have found a lender that has a good track record and decent interest rates.
    • Be sure to check if the loan that has been taken out will automatically be renewed if a payment is not made on the loan. If the answer is yes, ensure that you find out the interest rate, and if any fees will incur with the loan renewal.
    • Read the loan contract carefully and meticulously.
    • When applying for a easy loans, it is extremely important that you have an understanding of every factor and piece of information possible, including all fees, interest rates and the terms of payment.

Many fast cash loan lenders have various payment options that are available for the length of your loan and the type of payments. Selecting the right short-term loan means that you must also choose the payment option that is best suited to you. Most of the loans that are offered from reputable lenders are usually quick and easy, however, it is important that you consider the long term and select the type of loan that is right for you personally.

looking for fash cash loans online
 

The factors that you should consider are:

1. How long will it be before you receive money next?
2. What payment option is the best suited to you and your circumstances?
3. What is the most cost-effective loan option?

To avoid regretting your decision in the future it is essential that you take the time to consider these factors. It is best to find a lender that has dynamic lending terms to ensure that you are only paying for the money that you actually use.

    • It is essential that you do not stretch yourself when applying for short term loan. Only borrow what you absolutely need. Often, the more money that you borrow, the higher the interest rates that are associated with the loan and we understand that there is nothing worse than having to borrow money that you do not require which can ultimately mean paying almost double the amount of interest.
    • It is essential that you hold up your end of the contract and pay the money back when it is due. If, for some reason or special circumstances occur and you cannot make repayments on time, you should transparently explain your situation to the lender and request an extension. Many lenders will be more than happy to oblige the request and offer you an extension.
    • The personal information and especially your banking information that you share online is more vulnerable than ever. It is so important to be smart about your data security. One of the best ways to ensure that your information is not being stolen is to look into the lender’s reputation. Although this is a great way to start gathering information about an online lender, it is important to note that reviews can easily be faked. Another is to ensure that any websites where you input any personal information are SSL encrypted. This essentially means that the website address begins with ‘https’ rather than just ‘http’. Think smart and make wise decisions about your personal information and security.

 

Why LoanOne?

LoanOne is one of Australia’s most responsible finance providers, offering fast cash advances to Australians. The solutions that we offer everyday Australians do not require a mountain of paperwork, long delays, hidden fees or those damaging fine prints. At LoanOne, we have transformed the way Australians access fast cash advances online!

With LoanOne, get fast, simple and safe loans!

Fill in our 5 minute online application today!

How to Choose the Right Small Business Loan – Same Day Loans?

small business loan

If your small business is in need of a loan, we know that trying to find the right lender for your businesses needs and the right type of loan can be an extremely confusing and complicated process.

When your small business is applying for a loan, it is crucial for you to prepare and develop an in-depth business plan and to fully and transparently inform your chosen lender about the proposed venture. The information that is offered will help the lender to provide you with the right type of finance solution, along with any advice moving forward.

In order for you to make the right decision, you must first answer a few essential questions:

  • How much does your small business need?
  • What will the money be used for?
  • How fast do you need to acquire the money?
  • How long will it take your small business to pay the loan back?
  • How long have you been in business?
  • What is the current financial situation of your small business?
  • How much, if any, collateral are you required to put forward for your loan?

By thoughtfully answering these simple questions, it will help to determine if your small business should seek to pursue a government-backed loan, a loan or line credit from a bank, or, a cash advance, line of credit or a loan from an alternative lender.
 

Types of Lender

If you are unsure of what type of lender is best suited for your small businesses, then we have devised an in depth breakdown of what you must know about each type of lender before applying for your small business loan.

Conventional Bank Loans

A conventional bank loan, either through a mortgage or a traditional loan, is similar to that of a homebuyers loan, however, they are not offered of secured by a government entity. Finances for a small business are most generally acquired through traditional bank business loans.

One of the biggest benefits of conventional bank loans for small businesses is that they, most often than not, carry low interest rants. Along with this, as no federal agencies are involved in the decision making process, the approval process can generally be much faster. However, these types of conventional bank small business loans typically involve considerably shorter repayment terms and often involve balloon payments. It is also much more difficult for small business to gain approval for these types of conventional bank loans. Even though in recent years, approval rates have increased and improved for small businesses, the big banks only approve marginally more than 20% of the loan requests that they receive. On the other hand, smaller banks approve fewer than half of the loan requests that they receive.

Alternative Lenders

Alternative loan lenders are especially attractive to small businesses that may not have a particularly excellent financial history as their approval requirements tend to be much less strict and are much more flexible. Alternative lenders usually offer straightforward and quick online applications, typically can make approval decision in just a few hours and can provide small businesses with same day loans.

The benefits of working with an alternative lender are that your small business is not required to have an immaculate financial history, there are only very few restrictions for what the money can be used for, and, the most attractive of all, the loans can be approved almost instantly.

The disadvantage, however, is that the interest rates that are attached to these loans may be somewhat higher than those rates that are charged by the big banks. Alternative loan lenders for small businesses are much more willing to provide small businesses and companies with a loan, even if they do not have outstanding credit ratings and this increased risk that these alternative lenders take onboard is simply reflected in the interest rates that they charge.

Risk Assessment

business loan
Conventional banks and alternative lenders will assess your small business’s risk profile when they are considering and revising your loan application. By understanding what lenders look for when they are considering small businesses that are at a high risk will assist you in presenting your business in the most favourable manner.

Generally, lenders will examine:

  • The level and nature of the security of the loan. In other words, what you can offer to give them if you cannot repay the loan, also known as collateral.
  • The businesses ability to make regular, and on time, loan repayments, also known as the cash flow risk.
  • The businesses ability to eventually repay the debt in the allotted time, along with any other debts that the business may have obtained.

As a small business owner, you will need to be able to effectively assess the level of cash flow for the businesses specific circumstances. To a lender, one of the most important factors that is considered when offering a loan is the projected cash flow requirements of the business, as this is the amount of cash that is left after expenses that will repay the loan, not income. This will also exhibit you as an effective manager.
 

Types of Loans


Loans from conventional lenders such as banks, and alternative lenders offer the following loans for small businesses:

Working Capital Loans

Working Capital Loans have been designed as only short-term, temporary money solutions for small businesses that require money in order to assist them in running their operations. Working Capital Loans are both attainable from conventional banks and alternative lenders.

One of the largest advantages of obtaining a Working Capital Loan is that it offers small businesses the capability to keep their daily operations running while the seek other processes to increase their revenue.

On the other hand, one of the downsides of obtaining a Working Capital Loan is that they often are attached to higher interest rates and have shorter repayment terms.

Equipment Loans

Both conventional banks and alternative lenders offer small businesses their own class of equipment loans. These equipment loans offer small businesses money for essential office equipment, such as computers or copy machines, or other necessary equipment such as machinery or tools.

Rather than making large, initial purchase of these items that must be paid upfront, Equipment Loans allow for the business owners of these small businesses to make fixed monthly repayments on these items.

Obtaining an Equipment Loan is advantageous for small businesses as they aid in preserving cash flow and as they do not require any large down payments and some of these items may receive tax write-off benefits.

One benefit of Equipment Loans for small businesses is they are considerably easier to obtain than other types of loans for small businesses as the equipment that is purchased can be used as tangible collateral for the loan.

Merchant cash advance

Merchant Cash Advance loans are offered to small businesses based on the amount of their monthly credit card transactions. Small businesses can often receive a loan, or cash, advance of up to 125% of their monthly transaction amount.

The terms that are associated with repaying the merchant of a cash advance varies from lender to lender. There are some merchants that take a fixed amount from the business’s account each day, while other lenders will take a percentage of the sales that are made daily to the credit card.
The benefit of a Merchant Cash Advance for small businesses is that they are comparatively easy to obtain, the cash advance can be received in just a couple of days and that loan is repaid to the lender directly from the sales of the credit card.

One of the biggest downsides of Merchant Cash Advance loans is the expense that is associated. The interest on these loans can be as high as 30% per month, however, this number depends on the lender and the original amount that was borrowed.

Lines of Credit

Similar to that of Capital Loans, lines of credit offer small businesses with the money that is required for their daily cash flow needs. This type of loan is not recommended for larger business purchases and can be available for a range of time spans, anywhere from as short as 90 days and as long as several years.

When obtaining a Line of Credit, small businesses only take the amount that they need and therefore only pay interest on what they actually use, rather than paying interest on the entire amount of the loan. This type of loan generally have longer repayment terms and give small businesses the ability to build up their credit rating, should they make the interest repayments on time.

The disadvantages of Lines of Credit are the added fees that are applied to small businesses that are at risk of building a considerably large amount of debt with this loan option.

Professional Practice Loans

applying for business loan
Professional Practice Loans have specifically been designed for those who provide professional services, such as those small businesses that are in the healthcare sector, offer accounting, services or legal, insurance and veterinary fields of practice. Professional Practice Loans are generally offered to small businesses to purchase a practice, obtaining new equipment or to refinance debt.

Franchise Start-Up Loans

Franchise Start-Up Loans have been designed for entrepreneurs that require financing in order for them to open up their own franchise businesses. These Franchise Start-Up Loans are offered to small businesses by conventional banks and alternative lenders and the money can be used for working capital, to pay any fee associated with starting up the franchise, to purchase equipment or to build stores or restaurants.

Now that you have got the basics covered, you are more informed and ready to make the decision of which type of loan and provider is right for you and your small business.
 

Why LoanOne?


Unlike other alternative lenders, LoanOne understands how Australian small businesses work and will provide small business owners with easy, fast funding solutions that will help your business grow.

The business loans from LoanOne are different to other, traditional business loans as the loans that we offer are flexible, paper-free and unnecessary extensive supporting documents are not required. We aim to help businesses who need loans fast!

LoanOne offers businesses:

  • A fast and easy online application and a timely loan approval.
  • The most secure technology that will ensure that any information that you submit online remains strictly confidential.
  • A friendly customer service experience via phone or email.
  • No hidden fees! We have competitive fees that are consistent with financial industry standards and are completely transparent.

With LoanOne, get fast, simple and safe loans!
Fill in our 5 minute online application today!

How to Get Your Personal Loan Approved

approved personal loan

If you find yourself in a situation where you are in need to accommodate your basic daily living expenses, fund your big day or to take a much needed vacation, you may be considering taking out a quick personal loan.

In simple terms, a personal loan is the one where you are not required to put any of your possessions down for collateral where the lender can repossess these items if you fail to make payments. As the lenders of personal loans have no guarantee of the repayment of the loan other than your character or reputation, unsecured personal loans incur higher interest rate than collateralised loans.

Before applying for a personal loan, there are a few things that you can do to improve your chances of getting approved for a personal loan.
 

Tips for Getting Your Personal Loan Approved

Here are our best tips to improve your chances of approval and to help you to qualify for improved terms.
 

Determine the type of personal loan you require.

Personal loans are often referred to as unsecured, closed-end installment loans, however, technically auto loans, mortgages and even credit cards are all considered as personal loans rather than being considered as business loans. It is important that you fully understand what type of loan you are applying for.
 

Review your credit score.

credit score
You should aim to avoid applying for loans that you already know that you do not qualify for in the hope that it may be approved. Each time that you apply for a loan, it is then reported on your credit report and thus your credit score will suffer from a small blow.

Should your application be rejected, the damage that this can cause to your credit report can be significant. This is because you may be required to report any rejected applications in any of your future attempts to obtain credit or a loan. This may make your next lender significantly more cautious and hesitant to offer you a loan with optimal interest rates when examining your credit application.

You should request to receive your credit report at least once every year from a reputable credit reporting agency to ensure that all the information is correct and that there are no false or incorrect statements on it.

Once you have gathered all of this information, you should ask your lender of the guidelines that they are required to follow in order to assess applications prior to your application so you can ensure that you have met all of the necessary criteria to the best of your ability.
 

Boost your credit score.

It is important to note that your credit score is not necessarily set in stone. There are steps that you can take to improve your overall credit score before applying for a personal loan – this is especially important if your current credit score is close to the next classification category.

    Put simply:

  • Credit Score 760+ = Excellent Credit Rating
  • Credit Score 700+ = Good Credit Rating
  • Credit Score 640+ = Fair Credit

If your current credit score is 760, placing it in the Excellent Credit Rating category, increasing your credit to 770 will not be of much help in loan applications. However, if your credit score is 690, improving your credit score to above 700 can significantly improve the likelihood of an approved loan application, and can even save you a great deal of money should you qualify for lower interest rates.

Bad Credit No problem

Luckily, there are a few things that you can do to improve your credit score. One course of action can be by ensuring that you are consistently paying your bills on time and are actively working to reduce your debt – available credit ratio.

Should you have recently acquired a late payment, or another item that may have a negative effect on your credit history, it may be beneficial to wait for 6 months and ensure that you do not make any other late payments as this can improve your chances of gaining approval faster, with a lower interest rate.
 

Only consider reputable lenders.

Doing your research and doing some shopping online when looking for a quick personal loan is wise. By selecting the right lender you can save a lot of time and money that would otherwise be wasted running around between traditional lenders.

It is also important to note that online lenders often have much lower operating costs which means that you may benefit from the generally lower interest rates that they have to offer.

It is essential that when you are conducting this research, you are extremely wary as there are often a plethora of questionable lenders that will guarantee a loan approval however they are nothing more than loan scammers. Ensure that your chosen online lender is licensed and assess their previous customer reviews to see how they are rated.
 

Be aware of your Debt-to-Income Ratio.

When applying for a personal loan, apply for as little money as possible, only apply for a loan that you are sure you can pay back and ensure that you do not under or over-report your income.

In saying this, it is essential that you do not, under any circumstances, inflate your income or lie about your income, or any other detail for that matter, on your loan application.

Many people will fall into the trap of getting too creative with their income, especially if the lender does not require any documents that prove your income level. Should you be found to be lying about your income, you could be faced with criminal charges and the law tends to be relatively unforgiving especially if you are unable to make the necessary payments on a loan where you have been less than honest in your application.
 

The LoanOne Difference

LoanOne - Personal loans

LoanOne – Fast Personal Cash Loans


LoanOne personal loans are one of the safest and fastest ways in Australia to secure a personal loan. Whether you need the money to put down a payment on your new car, you have run into a family emergency or you simply need the money to stay on top of your daily living expenses, LoanOne personal loans are your fast, hassle-free and secure way to getting your hands on some quick money.

With LoanOne, you can apply for personal loan amounts from $2,100 to $8,000 with 12 month terms and the best part is that the application process won’t take you longer than 5 minutes.

With LoanOne, get fast, simple and safe loans!
Fill in our 5 minute online application today!

Top 8 Things You Should Know Before Applying for a Personal Loan

personal-loans

Sometimes situations can arise that are beyond our control and you may require an urgent capital injection. This could involve getting some emergency work done on your car or an unexpected bill pops up. Or you might want to renovate your house, purchase something important or go on a family vacation. But what happens when you don’t have the cash? That’s where a personal loan can help you out. When applying for a personal loan, it’s important that you choose a loan that is right for you. Let’s have a look at a checklist now of the top 8 things to consider for a personal loan.

 

1. What is a personal loan?

A personal loan is a lump sum of money that is borrowed from a lending institution. Personal loans have a predetermined time frame in which to pay the money back. This usually ranges anywhere from one to five years. Personal loans usually always have a fixed interest rate but this isn’t always the case.

Personal loans usually come in two different forms – secured and unsecured. Secured loans require the backing of collateral. This usually comes in the form of an asset such as a vehicle or property. This means that if you are unable to repay your loan for whatever reason, your lender has the right to seize your asset.

The main advantage of a secured loan is that the interest rate is generally quite low because you have an asset as collateral. This reduces the risk for the lender which is why they are able to pass on a lower interest rate to the borrower.

However, with an unsecured loan, there is no asset to use as collateral against the loan. Therefore, the lender will charge a higher interest rate in order to offset the risk of not having collateral. The loan term with an unsecured loan tends to also be shorter than that of a secured loan. In certain cases, you may not have the ability to qualify for a secured loan if you don’t have any assets to use as collateral. Therefore, you will have no choice but to apply for an unsecured loan.

 

2. Creditworthiness

All financial institutions will check your credit rating as part of the personal loan application process. If you do have a good credit standing, this may actually help you to obtain lower rates as you may be considered less of a risk to the lender. However, also be mindful of trying to apply for too many loans as this can also show up on your credit history and work against you.

If you do have a weak credit history, there are a number of financial institutions that will still consider you. Even if you have been bankrupt, some lending institutions will still actually provide you personal loans under certain terms and conditions.

 

3. Check the marketplace for lenders.

These days, there are many options available in which to secure personal loans aside from banks. There are a number of financial institutions offering short term and medium term personal loans. Even if you have been banking with the same bank for a number of years, that doesn’t necessarily mean that they will be offering the best rate.

It is important that you check the marketplace to see which lending institutions are offering the most competitive rates. There are a number of credit unions that can also offer you more competitive interest rates than most banks. You can now also find a number of online providers that offer personal loans that are competitive, but also very quick and convenient to apply for.

Peer to peer loans have also become a popular alternative to banks. This is an online platform in which potential borrowers and potential lenders are matched with each other. You are able to apply for both secured and unsecured loans with this platform. You can learn more by clicking here.

 

4. Term of the loan

Personal loans come with different loan terms. There are short term, medium term or even a long term loans such as a mortgage. With short term and medium term personal loans, you usually need to repay the money within a specific time frame. This is usually between 1 to 5 years. However, with a mortgage, this is usually payable over 20 years or more.

One of the most important considerations is the term of the loan. It is important to understand that the longer the loan term, the more interest you will pay over time. Therefore, the interest rate isn’t the only thing you need to consider. Taking the term of the loan into consideration is just as important as the interest rate.

 

5. Check that the credit provider is licensed.

All credit providers and lending institutions in Australia, including brokers, must be licensed by ASIC or at least be an authorised representative of an organisation that is licensed by ASIC. If you’re still not sure you can read more here.

There are a lot of scammers out there, so it’s important to make sure that you do not become seduced by somebody offering low interest rates. If you receive unsolicited contact from people offering financial products, please be very wary. Make sure you check their credentials and licenses before giving away any personal information.

 

6. Check the interest rate fees and charges.

Aside from the interest on your personal loan, there are also fees and charges that you need to consider. In Australia, from 1 July 2013, the fees and charges that financial institutions are permitted to charge on personal loans of more than $2,000 have been capped at a maximum amount. This means that for medium term loans, for amounts of $2001 and up to $5000, there is a one-off fee of $400. This also applies if the loan term is between 16 days and 2 years. A maximum annual interest rate of up 48% are also permitted.

If the loan amount is greater than $5000, and the term is longer than 2 years, the fees and charges cannot be higher than 48% annually. This also includes any other fixed fees or establishment fees that might be charged as above.

You also need to make sure you understand the costs involved if you were to payout your loan early. Some lending institutions actually charge a penalty if you were to pay off your loan early. So it’s important to make sure you know what these fees and charges are also. Hidden fees and charges could end up costing you a lot of money over the term of the loan.

 

7. Read your contract carefully.

This may seem obvious, but particularly when people are borrowing money for an emergency, and need the money quickly, they can sometimes overlook the terms and conditions of the credit contract. It is very important that you make sure the credit contract clearly states the amount you have borrowed, the interest rate (including the fees and charges), the term of the loan and how much the payments are, along with the due dates for those repayments. It is very important to make sure that all these items are included before you sign the final credit contract.

ALSO READ: LoanOne: Things You Should Know About Your Proposed Credit Contract

 

8. Paying your loan off sooner

No one likes being in debt, so the sooner you can pay your loan off the less interest you will pay. Conversely, if you do have any troubles repaying the loan, most credit providers are able to provide solutions if you communicate to them at the first sign of any trouble. Sometimes the unpredictable can happen along the way, but most lending institutions are able to assist you if something should happen during the term of your loan. However, if possible, you want to pay the loan off as soon as you can.