0844 943 2988 loans@ldbgroup.co.uk

FAQs

  • Is a Start Up Loan a grant?

    No. A grant is a non-repayable fund provided by an individual or an organisation for a particular purpose, whereas a Start Up Loan must be repaid in full over an agreed term of one to five years.

  • What type of finance is provided under the Start Up Loans scheme?

    Finance is provided by way of a personal loan that is regulated under the Consumer Credit Act 1974. This means the loan is taken out in your name and not the name of your venture. The loan is repayable on a monthly basis for the duration of the term of the loan. The finance provided to you is not a grant.

  • Why is a Start Up Loan a personal loan and not a business loan?

    We believe that it’s important for business owners to be personally invested in the success of their business, which is why Start Up Loans are structured as personal loans rather than business loans. By making individuals accountable for their loan repayments we seek to empower applicants to make the right decisions for themselves and their business, like how much to borrow and how the money should be used to achieve business goals.

    To support applicants in making these decisions, we require all individuals to submit a Business Plan, Cash Flow Forecast and Personal Survival Budget as part of their application. These documents serve two purposes. Firstly, they help us better understand an individual’s personal and business needs to determine how we can best support them. Secondly, they help us make a lending decision by allowing us to assess an individual’s ability to repay the loan and the viability of their business plans.

  • Are there any fees involved in applying for a Start Up Loan?

    No, there are no fees involved in either applying for or receiving a Start Up Loan, and no fees for the support we provide during and after the application process. Other than your monthly loan repayments, you will never be asked for any fees or other payments.

  • How many Start Up Loans can I apply for under the scheme?

    Every individual can only apply for a Start Up Loan for one business, so if you own multiple business ventures you will only be able to access finance for one of them. However, if after successfully securing a Start Up Loan you later require additional funding in order to grow and develop that same business, you may be eligible to apply for a Second Loan. You would need to go through a new application process and must have made at least six months of full loan repayments prior to applying. In addition, your total outstanding loan balance cannot exceed £25,000 at any one time.

  • Are all types of business eligible for a Start Up Loan?

    Start Up Loans are designed to be used to start a new business or grow an existing business that has been trading for less than 24 months. While we can support most business types, there are a few that we are unable to support.

  • Can I apply for a loan if I have poor credit?

    Poor credit isn’t necessarily a barrier to getting a Start Up Loan, however we do carry out a full credit check on applicants. Let’s Do Business Group is committed to lending responsibly and has to ensure that applicants will be able to repay the loan.

    You cannot receive a Start Up Loan if:

    • You are filing for or currently bankrupt or on a Debt Relief Order (DRO)
    • You have an outstanding Individual Voluntary Agreement (IVA) or Trust Deed
    • You are on Debt Management Programs or Debt Arrangement Schemes (DAS)
    • You have an outstanding county court judgement
  • I have a Debt Management Plan (DMP), can I apply?

    Unfortunately, we cannot consider your application until you have repaid these debts in full. We are committed to lending responsibly and will not lend where doing so will further indebt the applicant.

  • Why won’t you lend to people who have certain credit issues?

    As a Delivery Partner under The Start Up Loan Scheme, we are committed to being responsible lenders and it’s important to us that we don’t compound any existing credit issues that applicants may have by increasing their financial indebtedness.

  • Am I eligible to apply if I’m purchasing an existing business?

    Yes, you are still eligible to apply for a Start Up Loan if you are purchasing an existing business, even if it has been trading for more than two years under different ownership, provided you have personally not owned the business for more than two years. In this instance, you will be required to have sourced a copy of the financial accounts for the business and will need to provide these along with your application. Please note that if the business was previously or is currently operating at a loss, you will be expected to address this issue directly in your business plan.

  • Can my business partner apply too?

    Yes, multiple business partners for the same business can each individually apply for a Start Up Loan. We can lend a maximum of £100,000 to any one business, which means that up to four business partners can borrow a maximum of £25,000 each. Please note that all business partners must apply through the same Delivery Partner.

  • What is a credit check?

    A credit check is a review of your past and current financial behaviour that considers any sources of credit recorded against your name (including but not limited to credit cards, utility bills, mobile phone contracts and mortgages). As a responsible lender, we will conduct credit checks to avoid increasing financial indebtedness that may overburden an individual borrower.

  • Who conducts credit checks?

    If you are applying for a Start Up Loan, then as part of the application process, we will conduct a credit check on your behalf, provided you have given your consent in accordance with our Privacy and Data Sharing Policy.

    Please note, after a credit check has been conducted, our team is not able to discuss the specific details of your credit report with you. If you have concerns regarding your credit history, you will need to contact a Credit Reference Agency to request a copy of your Credit Report and address any concerns with them directly.

    Below is a list of the three main Credit Reference Agencies currently operating in the UK but please note, you may be charged a small fee if you choose to do this. It’s also important to remember that Credit Reference Agencies don’t always hold the same information on file, so you may wish to consult more than one if you have any concerns about the contents of your personal Credit Report.

    CallCredit
    Phone: 0870 0601414
    Website: www.callcredit.co.uk

    Equifax PLC
    Phone: 0870 010 0583
    Website: www.equifax.co.uk

    Experian
    Phone: 0844 4818000
    Website: www.experian.co.uk

  • Is it a personal credit check or a business credit check?

    Start Up Loans are personal loans so the credit check that we run is a personal credit check.

  • Does a credit check affect my credit score?

    When a credit check is completed as part of your Start Up Loan application, it leaves a ‘footprint’ on your credit report showing that you applied for finance. This may impact upon your credit score; however, an individual’s credit score is made up of many different factors that offer a combined view of your financial behaviours (such as other applications for credit, any credit previously secured and your history of making credit repayments etc.). If your Start Up Loan application is successful then it will appear on your personal Credit Report, along with any re-payments that you make, for at least six years.

  • How long is a credit check valid for?

    Any credit checks conducted as part of your Start Up Loan application are only valid for a three-month period. If your application is still in progress after this point, we will need to conduct a new credit check. In most cases, a credit check will be conducted at an early stage so you can be confident about your eligibility to apply for a Start Up Loan before investing your time in the rest of the application process. This means that you will have up to three months to finalise your business and personal documents, like your Business Plan, Cash Flow Forecast and Personal Survival Budget, which will form the basis of the assessment. For this reason, we encourage you to think carefully about when the most appropriate time to commence your application should be.

  • Can I still apply for a Start Up Loan if I have a poor credit history or credit impairments?

    A poor credit history will not necessarily prevent you from securing a Start Up Loan; however, it is certainly a factor that will be considered as part of our assessment process. We are committed to responsible lending and, as part of this, review each applicant’s past financial behaviours and current ability to afford the loan.

    For this reason, we are unable to lend to individuals with certain credit impairments. These include, but are not limited to, the following:

    • You are filing for or currently bankrupt or on a Debt Relief Order (DRO)
    • You have an outstanding Individual Voluntary Agreement (IVA) or Trust Deed
    • You are on Debt Management Programs or Debt Arrangement Schemes (DAS)
    • You have an outstanding County Court Judgement (CCJ)

     

    Please note, we will assess every application on its own merits and reserve the right to decline applications for other credit related reasons, particularly in cases where lending is likely to increase financial indebtedness that may overburden an individual.

  • What support am I entitled to while I’m going through the application process?

    We are on hand to support you through the application process. We can give you advice on completing the application forms and what information you’ll need to include. We can also advise you on how to create your business plan, cash flow forecast and personal survival budget, whether you need help creating these from scratch or just want someone to review and sense check them.

    Because we will also be assessing your loan application to determine whether or not you qualify for a Start Up Loan, our support will focus on putting you in the best possible position to succeed. It is important to remember that ultimately you are responsible for your application and even though we will do our best to support you, this does not guarantee you will qualify for the loan.

  • Can you offer support with drafting my business plan and cash flow forecast?

    Yes, we will be able to provide you with this support. Where possible we encourage you to attempt drafting your plans first, using our free templates, as this will help us get a better understanding of you and your business. But don’t worry, if you’ve never done this before and want some guidance before you get started, this is absolutely fine.

  • What support will I receive if my application is successful?

    Once you have drawn down your Start Up Loan, you will be offered 1:1 mentoring. You are entitled to 15-hours of free mentoring across the first 12-months of your loan term, but it is up to you and your mentor how frequently you catch up. In addition to mentoring support, you will also be entitled to access a range of exclusive offers from Start Up Loan Company Corporate Partners, including discounted offers, reduced rates and free giveaways on a range of leading business products and services.

  • What is a mentor and how will it benefit me?

    A mentor is an experienced individual who can provide you with support and guidance as you go about building your business. As exciting as it is, starting a business can also be both lonely and overwhelming, particularly in the early stages, so it can be very beneficial to have someone with experience, expertise and a different perspective to talk with. A mentor will not tell you how to run your business; instead they will assist you in learning how to make plans and strategies that will enable you to make the right decisions for your business.

  • Will I continue to receive support if my loan goes into default?

    Yes, if you happen to go into default you can seek support from us or your mentor but please note that you will also need to speak with your Finance Partner who manages your loan. Remember, it is not the our or the mentor’s responsibility to ensure that you keep up with your Start Up Loan repayments. Irrespective of your mentoring relationship, you are still responsible for paying back a Start Up Loan according to the agreed repayment plan that will be discussed during the application process.

  • Can my mentor provide debt advice?

    No, your mentor is there to provide general guidance and cannot provide specific advice such as debt counselling. Please talk to your Finance Partner if you are concerned about missing an upcoming loan repayment, or have already missed a loan repayment.

  • If I pull out of the business or it ceases trading, do I still have to repay the loan?

    Yes, a Start Up Loan is a personal loan that is used for business purposes and therefore you are personally liable for repaying the full loan amount and interest as per the Loan Agreement you signed, regardless of that status of your business or your position within it. The only time you can repay your loan without incurring any interest is during the 14-day cooling off period, directly after signing your Loan Agreement. During this period, if you decide you no longer want your loan you can return the funds and you won’t be liable for any of the interest you have accrued. Please refer to your Loan Agreement to confirm the details of your cooling off period.

  • What should I do if I think I’m going to miss a loan repayment?

    You should contact your Finance Partner immediately and let them know your situation. It is always best that you speak to your Finance Partner if you believe you may not be able to make your next repayment rather than wait until the payment is missed.

  • What happens if I default on my loan repayments?

    Our Finance Partners follow standard market practice when loan repayments are missed and take a fair and reasonable approach. If you fail to make a payment your Finance Partner will attempt to contact you to determine the reasons for the payment being missed. They will also work with you to come to a reasonable and fair agreement about how you will address this and fulfil your obligations in the future. This will be followed up with an email and/or letter stating that a repayment(s) has been missed and outlining what needs to be done to remedy the situation.

    If your Finance Partner is unable to contact you after repeated attempts, they may then look to recover the outstanding payments through various means such as, but not limited to, applying to issue a County Court Judgment (CCJ) or referring your case to an approved Debt Collection Agent. If you’re unsure who your Finance Partner is, please check your Loan Agreement.

  • I think I’m experiencing financial difficulty and need help managing my finances. What can I do?

    Don’t worry, there are plenty of free and impartial debt advice organisations willing to help.

    The Start Up Loans Company works closely with a major debt charity, Money Advice Trust, who offer the following services:

    • The National Debt Line:
      Debt advice experts who are committed to helping individuals improve their situation. Millions of people have already received support managing their debts.
    • The Business Debt Line:
      A unique service to help the self-employed and small businesses managed their debts.
  • I have received a Notice of Default from my Delivery Partner or Finance Partner. What should I do?

    It is important that you respond to any notices of missed payments as soon as possible. Full contact details will be provided on the notice you received.

  • What happens if I do not respond to notices of missed payments or fail to keep up with my repayments?

    It is important that you respond to any notices you receive and keep up to date with your loan repayments. Like any regulated consumer finance product, not meeting required loan repayments may result in one or more of the below actions against you:

    • Credit Reference Agencies may be notified of any outstanding amounts, which may affect your credit rating and ability to obtain goods, services or particular forms of employment.
    • A third-party collection agency may intervene to help recover any outstanding amounts.
    • Legal proceedings including, but not limited to, a County Court Judgment may commence.