Declined by Lumi because the business is too new?

If Lumi declined your application, short trading history is a common reason, including when an established business moved into a new company and the clock reset. HomeSec has no minimum trading period: loans of $20,000 to $5,000,000 are assessed on equity in real estate, the purpose and the exit, with up to six months of no repayments.

If Lumi declined your application, or it stalled while they waited on more history, you have probably met the rule that catches most young businesses: not enough months on the clock. That rule does not exist here. HomeSec offers Australia's fastest and most flexible business loans, with up to 6 months no payments, to start-ups and established businesses alike.

About Lumi, briefly

Lumi is a Sydney-based online lender, founded in 2018, offering unsecured business loans and lines of credit to small businesses. Like most unsecured lenders, it relies on the business's own trading to support the loan, and for a business with a solid run of trading behind it that can be a sensible fit.

Why newer businesses get declined by unsecured lenders

Without security, a lender has only the business's track record to go on. These are the gaps that usually decide it:

• Not enough months of trading. Many unsecured lenders want a minimum trading period before they will look at a file. A business a few months old fails that on the calendar, not on merit.
• A new entity, a new clock. Moving from sole trader to company, bringing in a partner under a new trust or buying a business into a fresh entity can reset the visible history to zero, even when the work has not changed at all.
• Turnover still building. Early months are rarely representative. A ramp-up looks like low turnover to a system that averages it.
• Not much on the director's credit file. A thin personal file can be as unhelpful as a bad one when there is nothing else to go on.
• Set-up costs showing in the account. Fit-out, stock and equipment going out before the revenue comes in reads as cash burn on a bank feed.

No trading history needed when there is property

Companies, trusts and sole traders — including start-ups. We assess the property, the equity in it, the business purpose and how the loan is repaid, and we do not ask for financials, tax returns or bank statements. A company registered last month is assessed the same way as one that has traded for a long time, because the security does the work a trading history would otherwise do.

The property can be yours, the business's or another owner's who agrees to offer it, with everyone on the title signing. More on start-up business loans and, if the credit file is part of the picture, a start-up loan with bad credit.

Where this comes up most

Professional practices that have just incorporated, new clinics, studios and salons in their first year, and owners who have bought an existing business into a new company. See professional services and beauty, fitness and wellness.

What to do in the next 24 hours

1. Do not wait out the clock. Applying again in a few months only works if the need can wait, and it usually cannot.
2. Have the entity details ready. The ABN or ACN of the business that will borrow. How to find your ABN or ACN.
3. Identify the property. Whose name it is in, a rough value and what is owing.
4. Be clear on the purpose. Fit-out, stock, equipment, a lease deposit or working capital. It needs to be for the business.
5. Call a Lending Manager and get an indicative answer before you spend any more time on applications.