Genie Lending’s blog provides helpful information and advice about business loans and alternative finance methods. Learn more today.

Should you Take Advantage of Falling House Prices?

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The nation’s housing market has been volatile over the last couple of years, mainly due to political influences such as Brexit. The UK’s uncertain economic climate has had a huge impact on the housing market, and the change in stamp duty for buy-to-let properties and second homes has also weakened demand for properties.

The slowdown in growth is usually seen as a negative thing, as homeowners will lose out when selling. However, a fall in house prices can create an interesting prospect for the entrepreneurial opportunist. If buyers move fast, they can take advantage of low house prices before they are predicted to start rising again.

Halifax, Britain’s largest lender, released its figures for June showing property prices were falling fast. UK prices fell 1% in June, which is the largest drop since January. It is the third month in a row in which figures have fallen, and that hasn’t happened since 2012. According to Halifax, growth in house prices is now down to 2.6% in June – the lowest increase in four years.

The evident slowdown is particularly evident in London, where house prices are inflated compared to the rest of the UK. In fact, over a third of properties on the market in July slashed their asking prices according to research from HouseSimple. So is now the time to invest in a property or two?

Falling House Prices: An Opportunity?

First time buyers are happy at this news as it means they might actually be able to get onto the property ladder at last. However, commercial buyers and investors could also capitalise on falling house prices. A reduction in prices means buyers get better value for money, however more owners may hold onto their property for longer to see if they will be able to get a higher price in the future.

A fall in property prices can be a perfect business opportunity – but you’ll have to act fast. You never know which way the market will swing, so you could end up paying thousands more even by pushing back your search a month or so. If you find the ideal property at an ideal price, be sure to secure funding from a lender who will pay out in good time. If a mortgage application takes too long or is refused, then the seller will look elsewhere. If you want a quick transaction then sometimes it’s acceptable to apply for bridging finance instead, which is paid out at short notice. Once the short term loan needs to be paid off, you can convert it into a mortgage if needed.

Do you want to see what property opportunities are waiting for you? Speak to us today about commercial mortgages and bridging finance.

How Alternative Finance Could Plug the Funding Gap Post Brexit

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Whatever you think about Brexit, there’s no denying that it will cause a funding gap for UK businesses. Billions of small business support comes from the EU, so once we officially leave the union it will no doubt have a huge impact on British businesses – what some people are referring to as a “funding black hole.” A report from the Federation of Small Businesses found that £3.6bn of funding comes from the EU, and as the UK government has not budgeted for a replacement regional fund, companies face a shortfall from 2021.

Additionally, the European Investment Fund (EIF) has shifted its focus away from the UK after the Brexit vote, leaving UK tech firms cut off from Europe’s largest source of capital venture funding. This is a huge blow to Great Britain’s tech start-up scene which is currently one of the largest in the world.

When the current EU funding pot runs out in 2021, it is essential that the government invests in local businesses – but that seems unlikely when they haven’t planned for it and have so many other pressing Brexit issues to deal with. So who or what will plug the funding gap? One thing is for sure – it won’t be the banks bailing us out.

Alternative finance solutions

The reality is that many small businesses and start-ups won’t have access to free business support and investment. We predict there will be a rise in personal investors, such as ‘Dragons’ or ‘Angel investors’ and many entrepreneurs will have to look for other ways of funding their business ideas. Business loans from the bank are rarely available to start-ups and the majority of individuals wouldn’t meet the strict criteria, leaving them little option when it comes to financing a business.

The alternative finance market has been providing non-conventional borrowing for businesses for years now, and the responsibility of post-Brexit business funding may fall there. Offering crowdfunding solutions, peer to peer funding, asset finance and unsecured business loans, these alternative finance providers could be the answer for SMEs, start-ups, businesses looking to achieve growth and entrepreneurs alike.

Because alternative finance solutions are tailored, a specialist finance broker can help identify the right financial product for each business. Although they will have to pay the loan back with interest on top, this type of finance is usually more favourable than the bank’s interest rates and the cash is often delivered a lot faster.

Do you worry about how your business will thrive without EU funding? See how Genie Lending can help.

How to Fund your Property Project

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Are you thinking of starting your very own buy-to-let empire? Perhaps you want to invest in a few commercial properties to grow your business and expand nationwide. Whatever the reason behind your exciting property project, the first step is to make sure you can receive the amount of funding you require to get started.

To give the construction company or the estate agent the go ahead, you’ll need to find a funding source. Traditional mortgages, even buy-to-let mortgages or commercial mortgages are proving hard to get and unless you meet a strict set of criteria, it’s unlikely the bank will help you finance your project. But that doesn’t mean you should give up on your dreams – there are many other ways to get your property venture off the ground.

Investing in property can be difficult when you’re just starting out. Once you have a portfolio and can prove you can make a profit it’s actually easier to secure funding – but until then here are the options.

Cash

If you have a lot of cash ready for investing somewhere, for example if you’ve received a large inheritance, then this is the best option. Buying a property upfront is very rare, but if you’re lucky enough to have a large lump sum then you’ll reap the rewards with this kind of transaction. If you have a large figure but it doesn’t reach the asking price, putting as much as you can down as a deposit will obviously reduce the future repayments.

Mortgage

A buy to let mortgage and a commercial mortgage works differently to a residential mortgage. It’s important to know the risks before applying and worth checking if you’re eligible to secure this kind of mortgage. It’s a good idea to contact a loan broker who can search around for the best deals for property investment.

Alternative Finance Solutions

The average person probably won’t be able to use the first two options to fund their first buy to let property and start a portfolio. Luckily, there is another solution – alternative finance providers. These providers use investors and other means to provide loans and tailored finance solutions when an off-the-shelf bank mortgage doesn’t suit. Even individuals with no supporting accounts or an adverse credit history could be eligible for a non-status commercial loan and development funding.

It can be difficult to find the right property funding for you, so why not chat to our property financing experts today.

How to Finance a Start-up Business

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Starting a business in the current economic climate, with Brexit looming, is a challenge – some would say an impossible way. But innovation stops for nobody, so entrepreneurs planning to launch a business only have one thing in their way – financial limitations. Funding a start-up business is extremely difficult because there is no way to prove if a business will be profitable or not. Lending to a start-up is tremendously risky, and many banks and financial institutions are not willing to take that risk.

So without the help of a bank loan, how can a start-up get off the ground? Start-up finance is a niche and can be a difficult uphill struggle, but there are a range of investment options to explore as a new business. Securing the funding is a vital step to launching your business idea – here are some ways to finance a start-up business. Read more →

Beat the Big Banks with Alternative Finance

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Sometimes in life it’s better to go with the ‘alternative’ option. It could be an unconventional route to your dream career or simply a distinct taste in music, but for many of us the alternative seems like the right choice. When it comes to lending, alternative finance options are becoming mainstream thanks to big banks refusing funding to the majority of start-up businesses.

The conventional banking system simply isn’t working for most of us. Without alternative finance providers offering solutions such as peer-to-peer lending, crowdfunding and asset finance, most businesses wouldn’t be here today. These alternative finance specialists are plugging the gap the banks can’t fill, and giving a boost to the economy. Read more →

Loan Matching: How to Find the Perfect Loan for You

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If you need a business loan, it can be really challenging to sift through the vast amount of information and criteria to find the right type of finance. First of all you need to decide which type of loan is best for your business, and then find a reputable lender guaranteed to accept your application. On top of all that, you also need to understand the pros and cons of lending from a bank or an alternative finance platform.

It can seem like a never ending maze, but help is at hand. Here are some ways to ensure you find the perfect business loan.

Impartial Advice

First of all you shouldn’t seek advice from a business or organisation which is offering any type of lending service. While they may be experts in the financial market, they could try and persuade you into a decision which benefits them instead of you. There are plenty of places where you can get impartial advice which is tailored to your personal situation and business. Government organisations such as the Money Advice Service has lots of online resources and offers free advice. You could also hire a financial advisor to help you make important decisions.

Define the Purpose

It’s really important that you define the purpose of the loan before going any further. Business loans differ from personal loans because you will have to state exactly how the finance will be used. The purpose of the loan could also dictate the type of loan you apply for, for example a commercial mortgage is specifically for property investment, while asset finance must be used for purchasing business assets. Make sure you have done some research and know exactly how much you need to borrow.

Finance Broker

Once you have a better understanding of the range of business loans available, it’s time to find the right lender. A commercial finance broker can act as a matchmaker, pairing you up with the ideal lender. Not only could you benefit from their market expertise, but a broker will save you a lot of time searching the web and making phone calls to a number of different lenders. When it comes to loan matching, brokers know best.

When it comes to commercial finance, there are so many options and it’s easy to feel overwhelmed. It is possible to find the perfect loan for your business, just be sure to do lots of research and don’t rush into any decisions.

Why Has Crowdfunding and P2P Lending Become so Popular?

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Last year in the UK, peer to peer lending reached new heights – lending £3.2bn across 2016, which is up 39% from the year before. Crowdfunding and P2P platforms have been around for over a decade now, and are showing no signs of slowing down. But what has made them so popular, especially with start-ups, small businesses and medium sized enterprises?

There’s a number of factors which have contributed to the boom of alternative finance solutions, such as peer to peer lending and crowdfunding. The uncertain global economic market has definitely played a part, as the recession impacted banks and traditional lenders. Also, consumers and now much more comfortable using the internet to apply for loans and transfer money, which opens up a wealth of opportunity for the financial sector.

Discovering Crowdfunding and P2P Lending?

They are often grouped together but there is a distinct difference between crowdfunding platforms and peer to peer lending. In both cases, it is usually a number of investors who will contribute to the amount you borrow.

P2P is very similar to a business loan from a bank, except that you’re borrowing off real people. You’ll pay back interest to your investors in return for the borrowed finance, and it’s a flexible way for companies to receive a fast cash injection.

Crowdfunding is different because you will receive money from a group of individuals or organisations to make up the amount you require. You will then need to offer your backers some sort of reward – for start-ups this could be a perk such as a discount or free product. Alternatively, if you’re looking for big investors then you may need to offer equity in your business or a profit share – think of Dragon’s Den.

Usually, crowdfunding is a great option for entrepreneurs and start-ups while peer to peer lending is more suited to established businesses.

Why are they so Popular?

These types of alternative finance are now mainstream because it is so difficult to get a traditional business loan from a bank. Lending has decreased for years now, making it impossible for people to get their business ideas off the ground. Without personal investment, entrepreneurs are left with no choice but to pitch their idea online to investors. Even established businesses with a strong trading history can struggle to be accepted for financial help from a bank.

Another reason why peer to peer lending is attractive is the generally low interest rates. If you apply for P2P through a financial broker, they will look at all offers and all interest rates and offer an average interest rate. Larger financial institutions have less competition so don’t offer the best deal.

Ready to see what all the fuss is about? Contact us to find out more about P2P or crowdfunding.

How a Business Loan Could Save Your Business

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In the current unpredictable economic climate, it’s easy to see why some entrepreneurs and businesses are reluctant to borrow. However, capital could keep the company running in hard times until business improves. More investment is often the answer to improving the business and growing the company. When a business loan is properly costed and you know you won’t be left in long-term debt, it is often a wise move to save your business from failing.

It’s common knowledge that the majority of businesses won’t be eligible for a bank loan. Traditional banks are tightening their lending, however alternative finance providers are helping more and more fledgling businesses. The different types of capital available have helped all sizes of companies in a range of sectors to flourish.

Here’s how a business loan could save your business.

Grasp Opportunities

In business there are many opportunities which sound like a great idea, from buying an adjacent property in order to expand to investing in bulk in order to offer the best prices. Unfortunately, you can rarely take advantage of these opportunities unless you have money in the bank. If you see a business prospect, it won’t be around for long – but a business loan could save the day. Apply through an alternative finance provider and you could have fast cash in as little as a few hours. This type of finance is generally low risk if you know the opportunity will result in a revenue boost.

Asset Purchase

If a company relies on certain equipment or machinery to produce goods or provide a service, it pays to have reliable, market leading gear. When starting up you’ll need a large amount of capital to buy all the equipment needed – which is why you might need a loan. A business loan could also save the day further down the line when an important piece of machinery is faulty and you need to replace it, but don’t have the necessary funds in the cash flow.

Grow and Expand

Why do young businesses fail when they have a strong clientele and a good product? In many cases, it’s because they don’t have the capital needed to scale up. SMEs can’t deliver large orders or hire enough staff to deal with demand when they don’t have the cash. A business loan is often the only way firms can stay competitive, achieve growth and ensure they last longer than a few years.

Find out more about secured and unsecured business loans from our knowledgeable finance experts.

How to Choose a Commercial Finance Broker

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If your business needs some kind of finance, but you’re not 100% sure what kind of loan to apply for or from which provider, a finance broker can help. When choosing a commercial finance broker there are important factors to consider, as you need to be able to trust them and the service they are offering.

What do you need to look for in a commercial finance broker? How do you know which company will offer the best deals and present you with all suitable options? How do you know which brokers are trusted in the industry and have been recommended by other businesses? Here are some top tips for choosing right broker for you. Read more →

The Basics of Cash Flow Funding

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All businesses suffer hard times at some point – but that doesn’t mean they’ve reached the end of the road. The costs of running a business are always increasing, and sales are unpredictable, which is often a disaster waiting to happen. Many businesses have seasonal trading issues and struggle to find cash at certain times of the year. Whatever the cause of cash flow woes, most SMEs have them.

Cash flow funding is a solution to the problem. There are various forms of finance which can help businesses better manage their cash flow and avoid the downward spiral into debt. Alternative finance providers offer direct solutions to help companies balance the books, without high interest loans. The right cash flow funding solution depends on the type of business and its finance needs. Here are the main types of funding available for cash flow purposes. Read more →