Alternative Lenders: FAQs

In the course of our work, we’ve noticed some common questions popping up, especially around the intriguing world of alternative lenders and the potential hiccups that can come with it. We get it! To make things easier for you, we’ve gathered up those FAQs and answered them based on not just our market know-how but also the wealth of experience our team brings to the table. Because when you’re in the know, you can make the best decisions for your unique journey.

Will Alternative Lenders be more expensive?

Not always but in many cases these lenders are prepared to take more risk than a bank, and for that they will charge more.

If you are looking for a straight like-for-like funder who understands your business better then in some cases they will be cheaper than an equivalent bank, if you are paying more its because you are getting more – higher advance rates, broader funding concentrations, a more patient lender and greater flexibility.

Will Alternative Lenders be more expensive
Will Alternative Lenders be more expensive

I’ve worked hard to build a relationship with my bank, isn’t it worth keeping that?

Most Alternative Lenders will provide debt facilities only, so you can keep your day-to-day relationship with the bank. Often the bank will prefer to retain profitable non-risk services and allow others to provide debt.

If the day-to-day isn’t working as well as you would like, there are Alternative Lenders who can provide a full service offering.

Relationship with the Bank
Relationship with the Bank

I’ve never heard of some of these lenders, isn’t it risky taking debt from them?

There are many well-known names in the Alternative Debt market. Most Alternative Lenders are smaller than the high street banks, particularly in a regional context which means you can speak directly to real decision makers.

There are hundreds of Alternative Lenders, many are unregulated. Working with an advisor will help you understand where a lender fits in the market, their track record and their approach to supporting clients.

The Alternative lending market grew out of the financial crisis, and was robustly tested during the pandemic – it and its lenders are here to stay.

Are Alternative Lenders Risky
Are Alternative Lenders Risky

What value do I get from you above and beyond other advisors?

Experience across multiple debt classes as both lenders and advisors, across a huge range of non-bank deals. We offer a senior resource led service focussed purely on raising debt in your part of the market.

Many other advisors will seek to reduce costs and maximise conversion rates, which means bigger deals and less experienced staff. We are a small dedicated practice, we focus on deals where we can add real value and then retain a longer term relationship. We have the flexibility and experience to ensure that all deals get the same service, whether it’s a £50m CID line or a £2m cashflow loan.

We do not focus on a quick fix solution but ensure you get longer term value.