Hub B · Approval
What do lenders look at? Approval, credit and documents
What a business lender actually checks, which documents matter, and how bad credit, ATO debt or a short trading history change the answer.
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- Q.B01 What do lenders look at when I apply for a business loan? Business lenders look at six things: cash flow and bank statement conduct, the purpose of the loan, how it will be repaid, security (if any), credit history for the business and its owners, and how long the business has traded. Existing debts, including ATO arrangements, are checked alongside. No single item decides the outcome — lenders weigh the whole picture, and different lenders weigh it differently.
- Q.B02 What documents do I need for a business loan? Most Australian business loans need photo ID for each owner or director, your ABN or ACN details, and recent business bank statements, usually six to twelve months. Larger or longer loans often add tax returns, financial statements and BAS. Property-secured loans add rates notices and a mortgage statement for the property. Evidence of purpose, such as a quote, invoice or ATO statement, speeds everything up.
- Q.B03 Can I get a business loan with bad credit? Often, yes. Bad credit doesn't automatically rule out a business loan. Lenders consider defaults, late payments and past insolvency case by case, looking at how long ago problems happened, whether debts were paid, what caused them and how the business trades now. Property security usually gives the most flexibility, because the lender can rely on the asset as well as the business's current performance.
- Q.B04 Can I get a business loan if I owe the ATO? Yes, often. ATO debt doesn't automatically stop a business loan. Lenders look at how much is owed, whether you're on a payment plan and keeping to it, whether lodgements are up to date, and whether the debt has been reported to credit bureaus. Many businesses use a loan to clear or reduce the tax debt itself. Property security usually gives the most flexibility, though unsecured options are sometimes possible.
- Q.B05 How long do I need to be trading to get a business loan? There's no single minimum. Unsecured lenders generally want enough trading history in your business bank statements to see a reliable pattern — often at least six to twelve months — while longer-term and bank loans usually expect two or more years of financials. Property-secured lenders can be more flexible, because the property carries more of the risk, so newer businesses with equity often have more options.
- Q.B06 Will checking my business loan options affect my credit score? Enquiring with us doesn't affect your credit score, because there's no credit check when you first enquire. A credit check usually happens only when you decide to proceed with a formal application, and that can add an enquiry to your credit file. Enquiries generally stay on a credit report for five years, and many applications in a short time can make lenders cautious, so it pays to talk first and apply once.
- Q.B07 What should I do if the bank said no to my business loan? A bank decline usually means your application didn't fit that bank's policy, not that your business can't borrow. Ask the bank for the reason, check your credit report, then match the reason to a route that fits: non-bank lenders often weigh recent bank statements more than old financials, and property-secured lenders focus on equity and a clear exit. Avoid firing off several applications at once, which adds credit enquiries.
- Q.B08 Do I need up-to-date tax returns to get a business loan? Not always. Many business loans can be assessed on recent business bank statements, BAS or property security rather than the latest tax returns. Banks and longer-term loans usually want returns and financials that are current. If your returns are behind, lenders will want to know the true tax position — often through an accountant's letter or estimate — and to see a plan to catch up.
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