- Limited company loans provide a funding solution for private limited companies in the UK.
- Businesses need to have an owner over the age of 18, be a limited company and be based in the UK to qualify for limited company funding.
- Applicants can borrow between £1k – £500k and repay between 1 – 24 months. Interest is charged at varying rates between 2% – 6%.
- Successful applicants can be approved for an unsecured business loan within 24 hours of their application being submitted.
What is a limited company loan?
A limited company loan is unsecured funding which is designed for businesses that are registered with Companies House. Private limited companies are eligible to receive unsecured funding to help their business grow.
How can I apply for a limited company business loan?
Owners of private limited companies can apply for unsecured business finance by completing an online application at the For Kredit Website. The super simple application allows applicants to apply for funding within a matter of minutes.
Successful applicants can be approved within 24 hours of the application being submitted. If applicants are unhappy with the funding provided by the lender, they do not have to accept the offer.
How much money can I borrow with a limited company loan?
Limited companies can borrow between £1,000 – £500,000 when applying with For Kredit. The funding is subject to approval by the lender, which means that the initial amount applied for may differ from the amount finally offered.
Is my limited company eligible for an unsecured business loan?
To be considered eligible for unsecured funding, the applicant needs to meet the minimum criteria:
- The owner of the business is over the age of 18 years old.
- The business is a limited company.
- The limited company is based in the UK.
Although an applicant may meet the minimum criteria, it does not guarantee that the applicant will be approved for business funding.
What are the repayment terms of a limited company loan?
Businesses can choose to repay their limited company loan over a period of 1 -24 months depending on what best suits them. The repayments are made in monthly instalments and interest rates are charged on the loan (2%-6%). There are no early repayment fees, so businesses can repay the loan early if they choose to.
Will I need to sign a personal guarantee if I am offered a limited company loan?
Yes, the director of the limited company will be asked to sign a personal guarantee if they are approved for a business loan. A personal guarantee helps minimise risk for the lender as it legally ensures that the director of the business is personally liable for repaying any outstanding debts if the business stopped operating.
I have a bad credit score, will this affect my application?
To an extent, having a bad credit score will affect an application for funding. However, it does not necessarily mean a business cannot receive a loan. If the lender does approve a loan, they may offer less money than what was applied for or charge a higher rate of interest on the loan.
The lender will always undertake soft credit checks to ensure that they get a clear picture of the borrower and adhere to responsible lending practices. The lender also looks at other key aspects of the business such as VAT returns or bank statements.
What is the difference between a limited company and a sole trader?
There are two types of core business structures in the UK, sole traders and limited companies. Below we’ve broken down the difference between the types of businesses.
A sole trader is essentially a one-man business, in which one person controls the whole business. Sole traders have complete authority over what they do with their business. It also means that they have complete personal liability, so if the business is in debt the sole trader is personally responsible for repaying the debt.
A limited company is legally separate from its owners or its shareholders, even if the business has one director. Therefore the business owner(s) personal belongings are not at risk of being lost like a sole trader, only what has been invested runs the risk of being lost. Furthermore, limited companies are considered more tax efficient than sole traders.
The structure of a limited company does mean that owners have less autonomy over the decisions they make, especially if there are multiple shareholders in the business.
Furthermore, running a limited company has more responsibilities such as ensuring that the right documentation is filed regularly and on time to Companies House when required. This can be quite costly and time-consuming and may need to be outsourced.
In addition, there is greater transparency when running a limited company. This means that the earnings of the business, the registration number and the registered office can be found by anyone on the Companies House website.
What other forms of funding are available for limited companies?
There are a number of funding options available for limited companies. At For Kredit, we can help find a number of unsecured funding options for different business types and situations.
- Startup business loans
- Small business loans
- Bad credit business loans
- Cash flow loans
- Short-term business loans.
- Unsecured business loans.
How much money can I apply for with a limited company loan?
Limited companies are eligible to apply for an unsecured business loan between £1,000 – £500,000 with For Kredit.
How can I apply for a limited company loan?
Limited companies can apply for unsecured funding online at the For Kredit website. The online application takes minutes to complete and successful applicants can be approved for funding within 24 hours of submitting their application. There are no costs for applying and the application is compatible with mobile and desktop devices.
How long do I have to repay the limited company loan?
Business owners have the option to repay the loan between 1 – 24 months depending on what they prefer. Repayments are made in monthly instalments and interest is charged on the loan.