Can I get a business loan with bad credit in the UK?

Quick answer: often, yes. A poor credit history narrows your options and can make finance more expensive, but many UK lenders look mainly at how your business is trading now. Finance secured against something of value, such as equipment, vehicles, unpaid invoices or card sales, is usually easier to obtain than a traditional unsecured bank loan.

What lenders look at besides your credit score

• Recent trading: turnover, profit and how money moves through your business bank account
• Affordability: whether repayments fit comfortably within your cash flow
• The story behind the credit issue: a single late payment or a satisfied CCJ from a few years ago is viewed very differently from recent, repeated arrears
• Directors’ credit history: for limited companies, lenders often check directors too, especially if a personal guarantee is needed

Types of finance that can be easier to get

• Asset finance and vehicle finance: the equipment or vehicle itself acts as security
• Invoice finance: based largely on the strength of your customers who owe you money
• Merchant cash advance: based on your card sales rather than mainly on credit history
• Secured business loans and property finance: where there is property or other security available

How to improve your chances

1. Check your business and personal credit files first, and correct any mistakes.
2. Have a short explanation ready for any adverse credit and what has changed since.
3. Prepare up-to-date figures: recent bank statements and management accounts help show how the business is performing now. See what information a business lender needs.
4. Avoid applying to lots of lenders yourself. Multiple hard credit searches in a short period can make lenders more cautious.

How a broker can help

A commercial finance broker knows which lenders consider businesses with credit issues and how to present your application. Bridgemead Finance is a broker, not a lender, and we can’t guarantee approval, but we can tell you honestly which options are realistic. Tell us what you need.