Loan FAQs
Does our project qualify?
London Rebuilding Society will lend to any enterprise or not-for-profit organisation that is focused on community or environmental benefit and that has a viable plan for success and for repayment of the loan. The enterprise can be in one of the standard social forms such as Company Limited by Guarantee, Industrial and Provident Society, Community Interest Company, but unlike many social lenders we also make loans to private limited companies that have social, ethical or environmental aims.
What documents do I need to supply?
From existing enterprises we need three years' past financial figures (Profit & Loss accounts and Balance Sheets), three years' projected figures (Profit & Loss accounts, Balance Sheets) and Cash Flow forecasts for at least the next two years. These should be accompanied by a written Business Plan, describing your business and what you are aiming for with it, and supporting the figures in the projections.
New start enterprises should have detailed plans both financial and operational, backed up by evidence of the market, and of their skills and ability to manage the business.
Other supporting documents include premises leases, sales contracts, funding agreements, etc. as applicable.
What if I haven't got a business plan?
It is important when looking for finance that you do have a business plan, as it shows the lender that you have a clear idea of what you are doing. The very act of getting it written down also helps to clarify your thoughts.
Can we help you with your business plan?
There are two sources of support that we can offer ourselves. From time to time we run training courses - see Events/Courses - which will equip you to write a coherent business plan.
We can also supply you with software which is designed to help you write your business plan - see Business Support
What is the process for obtaining a loan?
Please contact the Enterprise Investment Enquiry Desk for an initial discussion. We will talk to you about your financing needs and go over the documents you have already, and tell you where further work needs to be done. Once we are satisfied with the level and quality of the information you are providing, we will pass your application over to a Loan Officer.
The Loan Officer writes a report called a Loan Appraisal; in order to do this, he or she may have to come back to you with further questions. The Loan Appraisal is then reviewed by the Credit Committee which consists of Board members and officers of London Rebuilding Society. The Credit Committee takes the ultimate decision.
What factors are considered?
First of all we have to ascertain if the social objectives of your enterprise fit in to the aims of our lending funds. Then we have to be satisfied that the business is sound and that the loan will be repaid within the proposed term. Further details of what we look for can be found under the Business Support section of this website.
How long does it take to get a loan?
Once you have gathered together the above documents in a satisfactory form, the process should take no longer than 3 weeks from LRS' side. This consists of 2 weeks for the loan to be slotted into the appraisal queue and looked at, and a further week for the Credit Committee (mainly voluntary people with day jobs) to assess and approve. Any delays are usually because the client does not have the required information and has to go back and find it, or is not prompt in answering any questions that are raised, and of course this makes the whole process longer.
What does all this cost?
We charge an Appraisal Fee, generally about 1 1/2% of the value of the loan but this can vary depending upon the amount of work that is involved for the appraisal. This fee is only payable if the loan is approved, and is usually deducted from the loan.
What security do I need?
For social enterprises and other organisations without private profit distribution (e.g. Companies Limited by Guarantee and Industrial and Provident Societies), London Rebuilding Society simply takes a registered charge over the assets. This means that if you fail to keep to the loan agreement, and the whole loan becomes immediately repayable, then it can be repaid by selling everything the company owns. For private companies, we usually also require personal guarantees, but we do not take a specific charge over private property, such as the homes of directors.
What happens once I receive my loan?
Details of your enterprise will be included in LRS' website, and in marketing materials and events. All of this is useful for your PR. In return we ask for an acknowledgement of LRS on your website and a link back to LRS.
Of course we will be recording your loan repayments, and if there is any difficulty with them we much prefer that you talk to us in advance. We will look at your management accounts every quarter to see how you are doing, and we will contact you annually for information that will help us monitor our impact - for instance jobs created, workforce composition.
Want to know more?
Please do not hesitate to contact us.