small business loan

smallzoo

I wonder if anyone can offer advice on a small business loan as I'm sure there must be many companies in my situation.

I have been running my own software business for 20+years and still have a good order book. I turnover around £70k a year, have no debts, loans etc but when I have spoken to a few random companies they have said my company being a small two man band does not fit their lending criteria..

Anyone offer any advice on if and where I might go. Obviously it would great to hear from people who have been in similar situations.

I want to borrow around £6k and I understand that the rate(s) may be higher than average

Thanks

paulwf

I take it you have spoken to your bank? I got a company credit card with a £3K limit just by clicking a link on my online account, couldn't believe how easy it was!

My local business enterprise agency recommends http://www.capitalise.org/ so it might be worth seeing if there is something similar in your area as that sounds like what you are looking for.

smallzoo

Thanks.. I will have a word with my local agency

I am still open to other help and advice

chalkie99

20+ years in business surely your own bank has to be the one for such a small amount. Have you spoken to them?

No one else will have such access to your trading history.

Savvy_Sue

Is it worth telling us what you want the loan for? By all means tell us to mind our own business, but if it's a biz-related need we may have 'outside the box' suggestions.

InsideInsurance

Also, what is your legal structure? Ltd? partnership? sole trader(s)?

What is the purpose of the loan? Why do you need the loan rather than using turnover to fund it?

smallzoo

I am a limited company but I have to be honest in that I run a small business but do not consider myself a businessman !.. let me explain. Yes I turnover £60-70k but I am on my third accountant and all of them have basically just done my books and taken their £1000 fee. I have hardly claimed any expenses against my business so I have paid quite a lot of tax and in the end after paying our drawings and end up with very little in the business.. certainly not enough to lend £6k to me as an employee/director.

I have had 15+ year old cars for many years and I am now visiting some richer clients and doing more mileage I would like to buy a 1-3 years old Kia Ceed and possibly run it as a company car

Thanks

steve1980

So there is someone else in the company now?

You said "I" throughout your posts then sneak in an "our drawings"

Do you run the business from home? Do you rent an office? Are you claiming for mileage? What are your currebt outgoings?

Why do you want a Kia Ceed?

smallzoo

Hopefully your answer was not meant to sound as sarcastic is it did

So there is someone else in the company now?
.... My wife is my company secretary

You said "I" throughout your posts then sneak in an "our drawings"
....sorry, I would have thought small business and drawings were fairly obvious

Do you run the business from home? Do you rent an office? Are you claiming for mileage? What are your currebt outgoings?
... I work from home but spend time on clients sites both working, selling and presenting. My accountant does not explain what or what he is claiming for and foolishly I dont ask..

Why do you want a Kia Ceed?
..... warranty, low C02, 3yr residual value etc

Savvy_Sue

I thought I posted last night, but evidently not!

smallzoo wrote: »

I have had 15+ year old cars for many years and I am now visiting some richer clients and doing more mileage I would like to buy a 1-3 years old Kia Ceed and possibly run it as a company car

I think you need to think carefully about the BUSINESS benefits of this, you say 'possibly' run it as a company car, but the easiest way to get a loan for a car is to make it a personal one, or use a credit card or some combination.

And you had some good advice about accountants in another thread, so if your current accountant isn't being proactive enough in this or any other area, go and see some others with some specific questions, see if they can advise you and what sort of planning service they offer.

Superheavy

I work in the small business area for one of the high street banks, and lending does have to be on a firm business footing which you certainly seem to have at the moment.

However, certainly from my bank lending in the IT sector is certainly very restricted, and needs to have a business plan backing it up usually. Also, is the loan actually to pay for the car, or is that something else that you want? If it is, explaining to your bank how this would be able to boost turnover and profits would certainly be a good idea.

Paying lots of tax maybe something that many accountants try to reduce, but at least in this case it shows that your company has been consistently making profits, and this will look favourable in terms of the bank being more amenable to lending than a balance sheet where all the profits have been funnelled off under "expenses", which doesn't look so good.