Finance · 29 August 2019

How to buy property as a business owner with bad credit

Getting a business loan from a mainstream lender when you have poor credit can be difficult. As far as most major high street lenders go, bad credit mortgages are pretty much out of the equation.

As are most other types of secured loans for business purposes if the applicant in question has a poor credit history.

Problems with imperfect credit are just as common among UK businesses and business owners as they are among everyday households. Particularly when it comes to larger financial products like mortgages, qualifying with a poor credit history can be tricky. Nevertheless, there are alternative options to the usual mainstream channels available, which can be ideal for business owners with bad credit.

Understanding your financial position

Be honest for a moment – do you actually know your credit rating? Are you 100% sure as to where you stand regarding your credit history and financial position?

If the answer is no, you’re certainly not in the minority. In fact, a recent study carried out by YouGov found that no more than around 25% of people in the UK know their current credit score. Perhaps even more surprisingly, a study carried out by ComRes found that more than half (59%) of all small businesses in the UK have never checked their credit reports. In addition, a whopping 87% demonstrated a lack of knowledge as to the factors that can have an impact on a business’s credit score.

When you consider just how problematic bad credit can be, this makes for somewhat alarming reading.

Nevertheless, it also clearly demonstrates just how many businesses arent on top of their credit scores. If you’ve run into difficulties accessing finance for business purposes, you’re far from alone. But what does this mean in terms of bad credit borrowing options? If the usual lending channels are a no-go, how can you make major investments (like property) for business purposes when you have bad credit?

Beyond the high street

The key to flexible and affordable borrowing with bad credit lies in setting your sights beyond the High Street. If major lenders have no interest in working with you, there’s no point wasting time on a scattergun approach by submitting numerous applications that are likely to be rejected.

don’t forget that every rejected application could inflict further damage on your credit score.

Instead, it’s worth contacting an experience broker such as UK Property Finance who will analyse your situation and submit applications based on likely success, not to mention, the equity you have tied up in your business. Assuming your business, even if only recently started trading, is buying or already owns acceptable assets, you could have everything you need to qualify for a wide variety of secured loans as bad credit mortgages for business are not so reliant on a business’s income and can be organised for business borrowers based on sufficient collateral.


 
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Craig Upton supports UK businesses by increasing sales growth using various marketing solutions online. Creating strategic partnerships and keen focus to detail, Craig equips websites with the right tools to rank in organic search. Craig is also the CEO of iCONQUER, a UK based SEO Company and has been working in the digital marketing arena for many years. A trusted SEO consultant and trainer, Craig has worked with British brands such as FT.com, djkit.com, UK Property Finance, Serimax and also supported UK doctors, solicitors and property developers, gain more exposure online. Craig has gained a wealth of knowledge using Google and is committed to creating new opportunities and partnerships.

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