Contractor Business Loans
If you’re an independent contractor, you might think you can’t apply for a business loan, but you’d be wrong! There are plenty of flexible loan options available for contractors in every sector. Keep reading to learn more and apply.
- Compare a wide range of lenders and rates
- Check your eligibility in minutes
- Find out how much you could borrow
It's fast, free and won't affect your credit score
What is a contractor business loan?
A contractor business loan is specifically designed to help contractors in any industry (construction, consulting, professional services, etc.) manage the unique financial challenges being a contractor can bring, from late invoice payments to paying for raw materials.
What kind of independent contractors can get loans?
Regardless of your industry, you can apply for a small business loan, assuming you meet the lender's loan criteria.
Examples of independent contractors that can apply for a business loan:
- Marketing consultants
- IT technicians/engineers
- Freelance website designers
- Construction workers
- Accountants
- Lawyers
- Electricians
Business loans for contractors
So, what type of business loans can a contractor apply for? Here are some popular options:
Self-employed business loan
If you have a shorter trading history or you're a sole trader, you might find it easier to apply for a self-employed business loan. These loans are flexible and cater specifically to self-employed individuals, but the lender might assess personal credit score and require a personal guarantee (particularly for unsecured loans). These loans can be both secured and unsecured.
Small business loan
A small business loan could be a good option if you're looking for a larger loan amount that might not be on offer with a self-employed business loan. You can apply for between £1,000 and £500,000 with a small business loan. There are more finance types available under the umbrella of ‘small business loan’, including working capital loans, invoice finance, and merchant cash advance.
Quick business loan
Let's say you win a new contract, but it's a large project and you need materials quickly. Instead of paying out of your own pocket, you can utilise a quick business loan to cover initial costs and get started fast. A quick business loan is usually unsecured, with funds in your business bank account in a matter of hours after the lender accepts your loan application.
What can I use my contractor business loan for?
As long as you’re using your business loan for business purposes, you can spend the funds on anything you like. Lenders don’t usually stipulate what you can and can’t buy with these types of loans.
Managing cash flow
Managing cash flow as a contractor can be challenging. Delayed invoice payments or gaps between contracts can leave you financially short to cover essential business expenses like office rent or bills.
Purchasing raw materials
As an electrician or a construction contractor, you might find yourself needing to purchase materials to carry out the job you secure before any payment is made. This can leave you out of pocket and in a tricky situation. You want to complete the job to the highest standard to secure future work, but a high standard means quality materials. A contractor business loan gives you the funds you need to purchase all materials to ensure the job is completed to the highest standard (and within the timeframe).
Marketing and advertising
Marketing doesn't come cheap, particularly when you want to trial new strategies or take a chance on a new channel. Applying for a business loan gives you the financial confidence to take calculated risks, reach new audiences, and build on your existing brand awareness.
Hire staff
Winning new contacts as a contractor is exciting, but sometimes, delivering good on the project isn't possible alone. Sometimes, you might need to recruit additional staff. But hiring comes at a cost. A business loan means you can hire the best people for the job without worrying about how you'll afford to pay them on time.
How to apply for a contractor business loan
Applying for a business loan is quick and easy with our free loan comparison tool. By comparing what’s on the market, you save precious time and money.
Simply share what you’re looking for, and our self-serve tool will match you with eligible business loan options. Click to expand each loan offer to learn more and click through to the lender’s website to continue with your application online.
Find and compare independent contractor business loans.
About the author
Adrian T
5/5
Amazingly fast, efficient service, minimal paperwork. So much faster than my business bank of twelve years.
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