How does the picker decide?
It scores three routes — property-secured, unsecured and line of credit — against your answers, using the criteria lenders actually apply:
- Property. No property, no property-secured route. With property, that route opens up from $20,000 up to $1m, with no financials needed for the initial assessment.
- Trading time. Unsecured loans and lines of credit usually need six months or more of trading. Under that, property is usually the way in.
- Purpose. Recurring swings favour a line of credit. Bridging and IRD debt favour property-secured. Equipment, vehicles and stock can go either way.
- Amount. Under $20,000 sits below the property-secured minimum. Larger amounts lean toward security, because unsecured amounts depend on turnover.
The three routes in plain English
| Route | Backed by | Usually suits |
|---|---|---|
| Property-secured loan | NZ home, rental, commercial or land (first or second mortgage) | Bigger amounts, newer businesses, credit hiccups, IRD debt, bridging |
| Unsecured loan | Turnover and bank statements | Defined one-off needs for businesses trading 6+ months |
| Line of credit | Turnover and bank statements | Recurring or seasonal gaps; draw, repay, redraw |
Three example scenarios
A Christchurch electrician needing a new van
Trading four years, renting, needs around $55,000. No property rules out the secured route, so the picker ranks an unsecured loan first. See business vehicle funding.
A Napier café with a winter dip every year
Trading three years, owns a home, needs about $30,000 each winter. The recurring pattern puts a line of credit first, with a property-secured loan as a strong alternative if a bigger buffer is needed.
A new Hamilton engineering start-up with GST arrears
Trading five months, the director owns a rental, owes IRD about $70,000. Under six months rules out most unsecured options; property-secured funding can refinance or pay out IRD debt. See IRD tax debt funding.
What the picker can't see
Lenders also weigh credit history, how your bank account is run, the property's location and type, existing debt and — importantly — how the loan will be repaid. Weaker credit is considered on both routes, and every loan is priced on your individual circumstances. If the picker gives you two close options, that's normal: a specialist can compare them side by side. Want numbers first? Try the equity estimator or the cash-flow gap calculator. Your answers stay in your browser.