Short term business loans for New Zealand businesses

Not every funding need deserves a 20-year answer. A stock order that sells through by February, a customer who pays in 60 days, a property sale that settles next quarter: these are short problems, and they're best solved with short term business loans. fundU lends $20,000 to $1m to New Zealand businesses for short to medium terms, secured on property and repaid from a clear exit you can point to.

We're a direct lender, so the people you talk to are the people who decide. No panel, no hand-offs, and no long-term debt you'll be paying off long after the need has passed.

What is a short term business loan?

A short term business loan is lending designed to be repaid within a defined period, usually months rather than years, from a known source of money. It's matched to a specific purpose instead of sitting on the balance sheet indefinitely.

Think of it as borrowing time. Your business already has, or will soon have, the value it needs. The loan simply brings that value forward so you're not stuck waiting. At fundU, short-term loans are secured by a first or second mortgage over New Zealand property, which is what lets us move quickly and look past the gaps that trip up a standard bank application.

When does a short-term loan make sense?

A short-term loan makes sense when the need is temporary and the repayment is foreseeable. If you can describe where the money to repay it is coming from, you're halfway there.

Situations where Kiwi owners use short-term funding:

• Seasonal peaks — a Bay of Plenty packhouse contractor staffing up before harvest, or a retailer stocking up before Christmas
• Slow payers — a large invoice that won't be paid for 60 or 90 days while wages are due every week
• Waiting on a sale — a property, a vehicle fleet or a division of the business that's on the market
• Waiting on a refinance — a bank approval that's coming but won't land in time
• One-off opportunities — a supplier's clearance line, a competitor's equipment auction or a bulk buy at a sharp price
• Tax timing — paying a GST, PAYE or provisional tax bill now instead of letting penalties build

If the need is ongoing, like a business that loses money every month, a short-term loan on its own won't fix it. In that case we'll talk honestly about whether restructuring debt or a longer plan would serve you better.

How does a short-term loan compare with other quick options?

Business owners in a hurry often reach for whatever is closest: the overdraft, a credit card, or an unsecured online lender. Each has its place, but they're rarely built for larger sums.

Option	Typical size	Speed	What it's secured on	Best for
Business credit card	Small	Instant	Unsecured	Day-to-day purchases
Bank overdraft	Set by the bank	Weeks to set up or increase	Often property plus a general security agreement	Ongoing fluctuations
Unsecured online loan	Small to modest	Fast	Unsecured, usually with a personal guarantee	Small, short gaps
fundU short-term loan	$20,000 to $1m	Fast decisions, funding in as little as 24 hours once approved in some cases	First or second mortgage over property	Larger, defined needs with a clear exit

Because our loans are secured on real estate, we can lend larger amounts than most unsecured options and look at the whole situation rather than just an algorithm's score. If you've already stacked up several expensive short-term facilities, our guide to refinancing expensive short-term business debt is worth a read.

How long can a short term business loan run?

The term is set around your exit, not a one-size-fits-all product. We want the loan to end comfortably after the money you're relying on is expected to arrive, with some breathing room built in.

A few principles we use when agreeing a term:

• Work back from the realistic date your repayment arrives, not the best-case date
• Add a buffer for the things that usually run late: settlements, council sign-offs and customer payments
• Avoid a term so long that you pay for time you don't need
• Keep the plan simple enough that everyone understands it at the start

Our guide to exit strategies for short-term business loans sets out what makes an exit believable.

How are repayments structured?

We can structure a short-term loan in three ways, depending on the approved terms and what suits your cash flow.

• Capitalised interest. No scheduled monthly repayments during the term. Interest is added to the balance and repaid when the loan is paid out. This suits owners who need every dollar of trading income in the business.
• Interest-only. You pay the interest as you go and repay the principal at the end. Good when cash flow is steady but a lump sum is on its way.
• Principal and interest. Regular repayments that reduce the balance. Useful when repayment will come from ongoing trading.

With a short-term loan, the structure matters as much as the amount. Tell us how money moves through your business across the year and we'll suggest a structure that doesn't squeeze you in the wrong month.

What security do I need?

You need New Zealand real estate with enough equity. It can be your home, a rental, commercial premises, industrial property or, case by case, land and lifestyle property.

The property can be owned personally, by your company or family trust, or by a supporting party such as a family member acting as guarantor. If there's already a bank mortgage in place, we can often lend on a second mortgage and leave your bank loan untouched. If the property is clear, or you'd rather consolidate, we can lend on a first mortgage.

What does fundU look at when assessing a short-term loan?

We look at four things: the property, the purpose, the exit and the people. Trading history and credit scores are part of the story, but they're not the whole story.

• The property. Its value, its location, what's owed against it and how easily it could be sold or refinanced.
• The purpose. What the money will do, and whether the amount makes sense for that job.
• The exit. Where the repayment is coming from, how certain it is and how much it could slip before it becomes a problem.
• The people. Your experience in the industry, how you've handled setbacks and whether you're upfront about the difficult bits.

A signed sale agreement, a bank's conditional approval or a purchase order from a reliable customer all make an exit stronger. So does a plan B. If you're relying on a refinance, for example, it helps to know that selling a rental is a fallback. The clearer the picture, the faster we can give you an answer.

How do I get a short term business loan?

The process is quick because the decision sits with us.

1. Enquire online. It takes a couple of minutes and doesn't affect your credit score.
2. Talk it through. A lending specialist calls to understand the need, the security and the exit.
3. Initial assessment. Our credit team reviews the deal without needing financial statements or tax returns.
4. Confirm the details. We ask for any supporting evidence and arrange a valuation if required.
5. Approval and settlement. Your lawyer and ours complete the documents, and funds can be released in as little as 24 hours once approved in some cases.

Example scenario

An Auckland homewares importer had the chance to buy an extra container of stock ahead of Christmas at a discount, but its supplier needed payment within ten days. The order was worth about $140,000, and the owners expected it to sell through by the end of January.

The directors owned their home in Howick, valued at around $1.3m, with a bank mortgage in place. fundU lent $150,000 on a second mortgage for a short term, with capitalised interest so the business kept its cash for freight, GST and staff over the busy season. The loan was repaid from summer sales, and the bank mortgage was never touched.

What you'll need

For the first conversation, have this ready:

• A short description of what the money is for and why the need is temporary
• The amount you need and when you need it
• The property you're offering as security, who owns it and roughly what it's worth
• What's currently owed against the property
• Where the repayment is coming from and when you expect it
• Anything that could affect the picture, such as tax arrears or past credit issues

Supporting evidence, if we need it later, can include bank statements, purchase orders, sale agreements, contracts or an accountant's letter. Seasonal businesses might also like our guide to seasonal business cash flow.

Is a short-term loan right for your business?

If the need is real, the repayment is in sight and you have property to offer as security, a short-term loan from fundU can give you the time you need without saddling the business with years of debt. You might also compare our working capital finance if the gap is more about day-to-day cash flow.

Enquiring is free and won't affect your credit score. Call 09 875 4577 or start your enquiry and we'll call you back.