Who it may help
Possible fit
- Sole traders and contractors
- Self-employed tradespeople, consultants and creatives
- Company owners and directors
- Owners whose accounts or tax returns are behind
Self-employed and sole trader finance
Business loans for self-employed people and sole traders in NZ
Uneven income, a recent start or accounts that are running behind can make a bank say no, even when the business is sound. HomeSec is a direct, privately funded lender that looks first at what the money is for, the property securing it and how it will be repaid. Borrow $20,000 to $1,000,000 for genuine business purposes, subject to assessment.
Appropriate uses
Business needs
- Tools, vehicles and equipment
- Paying IRD, GST or provisional tax
- Taking on a bigger contract
- Covering slow-paying customers
Consider carefully
Important factors
- The money must be for the business, not personal or household spending
- Property offered as security may be at risk
- Identity, ownership and security still need verification
Why banks find self-employed borrowers harder
Banks commonly assess self-employed applicants on two or more years of financial statements and tax returns, and they tend to average the income. A strong recent year, a lumpy contract pipeline or a year with large one-off costs can all count against you, and a business that is only a few months old may not fit the model at all.
None of that means the business is a poor risk. It means the bank's model does not match how you earn. A lender that secures the loan over property can look at the scenario differently.
How HomeSec looks at a self-employed application
We start with three questions: what the money is for, what property secures it, and how it will be repaid. No valuations or cashflow records are needed to start an enquiry, so you can find out where you stand before spending time and money on updated accounts or a valuation.
Repayment might come from business cash flow, the sale of an asset, a refinance once your accounts are up to date, or a large contract payment. Approved facilities may offer up to six months with no scheduled payments, which can give a new contract or a busy season time to pay off. Interest still accrues during that time.
Sole trader, partnership or company
As a sole trader, you and the business are the same person in law. Inland Revenue taxes your net profit through your individual IR3 return, and you are personally responsible for the business's taxes and debts. A loan for a sole trader's business purpose is made to you personally.
If you trade through a company, the company usually borrows and its directors give personal guarantees. If the property is owned by you, jointly with someone else or through a family trust, everyone on the title, including the trustees, needs to be part of the security. Explain how the business and the property are owned at the start, so the structure is right first time.
Business loans, not home loans or personal loans
HomeSec lends only for genuine business or commercial purposes. If you are self-employed and want a loan to buy or refinance the home you live in, or a personal loan, talk to your bank or a mortgage adviser.
Business purposes include tools and equipment, a work vehicle, stock, paying IRD, funding a new contract, buying a business, or releasing equity in property you own to fund the business. We lend against suitable property almost anywhere in New Zealand.
How the assessment works
Purpose, property and repayment path.
A useful scenario is not only a requested amount. It connects the business need to suitable security and a realistic way for the facility to be repaid or refinanced.
- 1. Explain the opportunity.
Provide the amount, intended use and timing. - 2. Outline the property.
Share ownership, location, estimated value and current lending. - 3. Show the exit.
Describe how and when repayment or refinance is expected. - 4. Review terms and risks.
Understand the documents, total cost, obligations and alternatives before proceeding.
Top tips for a faster, smoother assessment.
The right level of documentation depends on the proposed structure and what the team needs to verify.
Identity, property ownership, existing lending, the source and use of funds, and the proposed exit may all need evidence. Legal work can also apply.
Raise difficult details early. Tax obligations, arrears, a recent credit event or an urgent deadline can be assessed more effectively when they are explained upfront.
Common questions
What business owners usually ask next.
Can I get a business loan if I am self-employed?
Yes. Being self-employed does not rule you out. HomeSec lends $20,000 to $1,000,000 for genuine business purposes, secured against suitable New Zealand property, and assesses the purpose, the security and the plan to repay rather than relying only on financial statements.
Can a sole trader get a business loan in NZ?
Yes. A sole trader can borrow for a business purpose in their own name, secured by property they own. Because a sole trader is personally responsible for the business's debts, be confident about how the loan will be repaid.
Do I need two years of financial statements?
Not to start. No valuations or cashflow records are needed for an initial enquiry. Further information may be requested during assessment, depending on the amount and the scenario.
My tax returns are behind. Can I still apply?
Possibly. Tell us where your returns and your IRD account stand. Paying IRD and getting up to date is a business purpose HomeSec lends for, and your accountant can help you plan the catch-up.
I have only just started working for myself. Can I borrow?
HomeSec has no minimum trading period. With suitable property security and a realistic plan to repay, a new business can be considered.
Can I get a self-employed home loan or personal loan from HomeSec?
No. HomeSec lends only for business or commercial purposes. For a home loan or a personal loan, talk to your bank or a mortgage adviser.
How quickly can a self-employed business loan be arranged?
Funding may be possible in as little as 24 hours, subject to approval, documents, security, legal work and settlement requirements.
Do I have to make repayments straight away?
Approved facilities may offer up to six months with no scheduled payments. Interest still accrues, and the payment settings that apply to you are set out in your loan contract.
Related pathways
Compare the nearby options.
Information is general only and is not an offer or approval of finance. Lending is subject to assessment, acceptable property security, documentation, legal requirements and final approval. Independent legal, financial and tax advice may be appropriate for your circumstances.
Next step
Discuss your self-employed business finance scenario.
A short scenario conversation can help establish whether property-secured business finance may fit.