What is a representative rate, and will I get it?

2 min read

Typical applicantWho the rate is set for

Not a guaranteeYour quote may differ

Risk-basedPriced from your accounts

Firm at offerConfirmed after underwriting

What 'representative' actually means

A representative rate is an illustration of what a business with reasonable but not exceptional finances would typically be offered for a given product. It is not a promise that you will receive it. The word is a signal that pricing is risk-based and individual: the lender is showing a realistic mid-point, not a floor everyone qualifies for.

This is why two directors reading the same page can end up with different quotes. Neither has been treated unfairly — each was priced on their own accounts. See how lenders set a rate for the mechanics behind that.

Why your firm quote can be higher or lower

Your quote is set after underwriting has seen the real picture: filed accounts, bank transaction data, existing commitments and — for a secured deal — the asset or guarantee behind it. A company stronger than the 'typical' applicant may be offered better than the representative rate. A younger or thinner-filed company is more likely to be offered above it.

The headline figure is a guide to whether a product is in the right ballpark for you, not a number to hold the lender to.

Using representative rates to shop sensibly

Representative pricing is still useful — it lets you rule products in or out before you spend time applying. What it cannot do is tell you your cost. For that you need a firm quote, and the only fair way to compare firm quotes is total repayable on identical terms. Feed each one into the true cost of borrowing calculator.

When you are ready for a real number rather than an illustration, apply to Credicorp — an indicative quote does not affect your ability to walk away.

Frequently asked questions

Does checking a representative rate affect my credit file?

Viewing an advertised representative rate does not affect anything — it is just marketing. Requesting a firm quote may involve a credit search. Many commercial lenders use a soft search for an initial indication and only run a hard search when you proceed to a full application. Ask which is being used before you submit.

If most people get the representative rate, why didn't I?

Representative pricing is built around a typical applicant, and 'typical' still leaves plenty of businesses on either side. Being quoted above it usually reflects a shorter trading history, thinner accounts or higher perceived sector risk rather than anything wrong with your application. Strengthening those inputs before reapplying is the route to a better number.