Short Term Business Loans

In need of an injection of cash? A short term business loan may be the solution.

Apply now for working capital, business expansion, debt consolidation or any other business use.

Benefits of Short Term Business Loans

A short term business loan, is a funding solution in its most traditional form. Business Loans work by transferring funds into your bank, operating as an injection of cash to your business, which will need to be repaid with interest within the agreed term. With this product, a term will be agreed between yourself and the lending partner of between 3 and 24 months. Longer term options are available, through an Unsecured, or Secured Business Loan. There are multiple other forms of Short Term funding, such as a Merchant Cash Advance, or an Invoice Finance products such as Factoring, or Invoice Discounting.


Short term business loans have plenty of advantages. They typically have a very quick turnaround time, which is ideal if you need a quick injection of cash. The funds can be transferred within as quick as 24 hours, with approvals being instant in some cases. The criteria for this type of product are also typically not as stringent as other products.  This is because the period of repayment is shorter, meaning less risk on the facility partner's behalf. Shorter term products can also be more cost effective, as you are not tied into paying back interest over a matter of years. There are a few negatives to short-term credit offerings compared to other products. This product typically has a higher interest rate when compared to longer term options, as the interest and fees are over a much shorter period of time. This means your monthly costs will be higher than that of a traditional business loan. If higher monthly payments is not something you can justify, perhaps a different product would suit you and your business better, with lower regular payments over a longer period.

Eligibility

Turnover

Unless you are a new start-up company, the minimum turnover most financiers will start at £100,000 turnover.

Trading History

Similarly to Turnover, start-up companies can acquire capital. Once you have filed accounts for your first year of trading, we can then approach our panel of lenders and submit your application.

UK Registered Businesses

Due to us operating within the UK, we can only find finance solutions for UK Limited Companies.

Can I still get a Short Term Business Loan if I have bad credit?
Yes, short term offerings can be acquired with a poor credit rating. If high street banks have rejected you on this basis, we have plenty of lenders you may still qualify for. We also have financiers available on our panel that can help acquire a facility for those with CCJs.

Will I be subject to credit checks?
We do not run any credit checks during our application stage. Some of our panel may ask to run a credit check, be it personal or business based. This will be made clear before any proceedings take place, and if you are not comfortable with this, a different path towards funding could be taken.

What are the alternatives?

If you think that perhaps a different funding solution would suit you better, we can recommend a number of options:

Unsecured Business Loans - Similar to a short term business loan, just with a longer term time. The monthly repayments will typically be lower, as the repayment term is longer. The term time for an unsecured facility can be anything from 12 months to 10 years. The typical cost of this type of product is typically 2% interest annually, although the range of this interest fee can be fairly broad, and will depend on numerous factors. These factors will define the cost of your facility, and are as follows: turnover, the strength of your business profile and your profitability.

Secured Business Loan - If you are unable to qualify for an a product you deemed more preferable, a secured option may be your best choice. These products can be used for any business uses, including but not limited to business expansion, equipment, consolidating debt or working capital. The amount you can borrow is based upon the value of the assets you own, which will be subject to valuation. Of course, committing security as collateral is not a preferable option, although the capital acquired can make the commitment worthwhile.

Revolving Credit Facility - Just like a credit card, you will have a set maximum borrowing total. This can be spent at any point, and then repaid back over time. This is known as revolving, as unlike a business loan, the paid back funds can be reborrowed at any point for further spending. This solution is especially beneficial for businesses who would like to maintain, or boost their working capital. Due to this, your cash flow will increase, ensuring you never miss payments to your suppliers, or to your staff.

Invoice Finance - It is common knowledge that when a company invoices another, it generally takes anything from 30 days to 120 days (sometimes more) before that company receives payments from its debtor. This can have an impact on business and stop them from continuing to trade, together with allowing them to grow to their full potential. Factoring is a cash flow solution. It releases an agreed percentage of unpaid invoices as soon as the invoice is raised (usually within 24 hours). Releasing funds oncw work has been completed, as opposed to once the payment term has been completed will increase cash flow. Cash flow is so important to maintaining a successful business, and your companies growth will go hand-in-hand with the steadiness and increase of your cash flow. The entry level requirements for Invoice Finance are: £100k turnover, 1 years trading, and UK Registered Limited Companies. A facility cost will typically be made up of two smaller fees. The service fee is calculated against the companies turnover, and covers the cost of the lenders service for the facility, including dealing with the collection of the funds, the administration, and their maintaining of your company’s sales ledger. The other fee involved is the discount fee (interest) this is charged against the money the company borrows from the lender. This is charged daily, and applied monthly. The typical service fee is around 3% annually, and a standard discount fee is around 4.5% monthly.

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FAQs

How much will a Short Term Business Loan cost?
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Short term business loans vary in cost. Lenders have their own costing model to compute the interest rates on funds being loaned out, although they typically start from around 1.5%. This will be assessed by the lender, and calculated against your business profile, as well as the amount of funds being approved and the length of the repyment term.

Am I eligible for a Short Term Business Loan?
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Eligibility varies largely from lender to lender, with some much more flexible, some more rigid. The basic criteria for applying for a Short Term Business Loan is as follows:
Unless you are a new start-up company, the minimum turnover most lenders will deal with is £100,000.
Similarly to Turnover, start-up companies can get funding. Once you have filed accounts for the year, we can then apply you as a fully-fledged trading business.
UK Registered Limited Company

If you don’t meet this criteria it isn’t the end of the road, other funding options are available, and this can be discussed with one of our consultants.

How long does it take to arrange a Short Term Business Loan?
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A short term business loan can be arranged and processed within 24 hours. Short term products typically have a faster turnaround time than other products, meaning you can have access to funding very quickly. Approvals with Short Term Business Loans can be almost instant, and in some cases, certain lenders can fund your product in as short as 24 hours.

How much money can I get through a Short Term Business Loan?
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This form of funding can vary hugely in amounts offered. With a Short Term Business Loan, anything between £10,000 and £500,000 can be funded. The amount offered will depend on mulitple factors, such as the strength of your business profile and your turnover. The amount borrowed, the lender you are in contact with, as well as the factors mentioned prior will affect the cost of the facility. More information on this topic is available above.

Why JD Capital Finance?
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We are not your average broker. We strive to find you the perfect funding facility for your business, in the easiest way possible. We designate a member of our team of specialist consultants to you, walking you through the entire process until the funds are in your hands.

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Disclaimer: JD Capital Finance 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. JD Capital Finance can introduce applicants to a number of providers based on the applicants' circumstances and creditworthiness. JD Capital Finance may receive a commission or finder’s fee for effecting such introductions.

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