Updated: 13 December 2016
A recent report indicated that in excess of 75% of small businesses start with less than £2,000 of start-up funds. It is not often that people are fortunate enough to start a business backed by unlimited funds but the facts are that amount of capital readily available at the start of a venture can often prove to be the difference between success and failure. There are a huge number of options available for anyone seeking additional credit, many of which are now targeted at people who have a less than perfect financial history. One of the most commonly used loans is known as a guarantor loan and new developments in this market now mean that it is possible to borrow up to £15,000, even if you are a first time customer. For anyone looking for an initial financial boost to help kickstart their business, this could prove to be vital. The presence of the guarantor helps to re-enforce the commitment to your business and your commitment to repaying the loan.
- Start-Up Costs – Guarantor loans can be granted to both new and existing businesses. Aspiring entrepreneurs can help to finance the start-up costs of their business by obtaining a loan. This is particularly helpful if you simply don’t have the cash to finance these costs yourself, and require a much needed boost to get your business off the ground.
- Accounts Receivables vs. Payables – Many businesses are cyclical in nature, and there is often a gap between accounts receivables (cash coming in) and accounts payable (cash going out). Guarantor loans can help to alleviate this temporary situation whilst ensuring that you don’t fall behind with your bills.
- Short-Term Operational Costs – Guarantor loans can cover a huge variety of short-term operational costs you may have. For example, the hiring of temporary staff or a new piece of equipment required to finish a job can easily be covered with a loan.
- Emergency Repairs and Maintenance – Unfortunately, unforeseen situations do arise on occasion. A guarantor loan can help you make it through an emergency situation.
- Cash Flow – Because guarantor loans can be repaid at any point without financial penalty, they are ideal for countering temporary cash flow situations. If you don’t have the money now, but you can depend upon money coming in within a certain period of time, a short-term loan would be a good way to fill the need.
£15,000 Guarantor Loan
A loan of £15,000 will generally be repaid over a period of 60 months (five years), but the loan can be paid back quicker by the applicant. With all of this in mind a guarantor loan of £15,000 can be a great benefit to those who require the credit and cannot access a loan from their bank or building society. As well as business owners, guarantor loans are also available to:
- People who are self employed
- Those on benefits
- Those with poor credit
- Home owners with little equity in their property
Some of these loans are provided with a fixed rate of interest making it easier to budget and can be taken out with no up front fees. Those who wish to take such a loan out just need a guarantor who will agree to guarantee the repayment of the loan should they fail to do so.
- Guarantor loans case study
- Business startup funding options
- How to fund a new career in your 20’s
- Borrowing to help your future