When is the best time to use a private money lender? This may be the question you are currently asking yourself. Alternative money lenders have become more and more prominent throughout New Zealand for a number of reasons, they offer several advantages in comparison to traditional institutes such as banks. Here are several good reasons to consider using alternative money lenders as opposed to conventional banks.
Approval Rates & Convenience
Although traditional banks will be able to offer you lower interest rates on your loan, most of the time you’ll still find it difficult to secure funding. They’ll require you to jump through a number of hoops before considering your application, this is often a waste of your time and in the end, you could miss out on vital opportunities. Before you have your loan approved, you must meet with a bank representative, explain to them why you need the money, and provide all sorts of documents as security and proof. Your application is then sent on to another official who again reviews the request, it is possible that your loan application could then make its ways into the office of another staff member before they decide whether to approve it. Banking institutes tend not to take risks with small business owners and the vast majority of the time they’ll deny your request.
On the other hand, private money lenders are much more open to small business loans. If you need cash loans and you require money fast, you’ll have much more success using alternative financing organisations. Most of these organisations specialising in funding small business owners or start-ups, they provide funding when most traditional institutes won’t.
Important Points to Consider
- If you are trying to secure a short-term loan, but you’ve been rejected by a conventional money lending institute, you can opt for a private money lender. Although you may have to pay slightly more in terms of rates, a difference of 3 or 4% over the space of 3 years isn’t much.
- If your trying to grow your business and a private money lender will provide you with the capital you need, then this organisation has served its purpose. If a private loan helps to expand your enterprise, then you really aren’t losing any money at all.
Fast & Simple
Applying for a loan from a private New Zealand based money lender can be done online, there is no need to visit the bank and apply in person. You can fill in an application online within a couple of minutes and the funds could be in your account that same day. Banking institutes just can’t compete when it comes to dealing with applications in such a timely fashion.
There are times when it will be better to use a private money lender as opposed to traditional banks. If you need quick cash, a convenient application process, and wider range of financing options, then private money lenders are perfect for you. Although the rate may be slightly higher, you’ll have a better chance of securing funds.