A business loan for £50,000 usually falls under the remit of a small business loan. However, you may well want to apply for a similar financing level for a more significant business.
There are many ways to apply, such as through your regular bank, through investment loans, or on an online platform, so there isn't just one type of loan that offers this level of borrowing.
Conventional loans work whereby you apply for a fixed value - £50,000 in this case. The bank will need to know the business purpose for the loan.
You pay interest on the borrowing and repay the debt every month. Each payment includes an element of capital and interest, so when you get to the end of the loan term, the debt is repaid in full.
Terms on £50k loans vary, but you're looking at anything from two to five years as an average.
There are both secured and unsecured loans available for this amount, so it's up to you whether you have a business asset to offer as security or want to take out an unsecured loan.
With advantages and disadvantages to both, it's vital to understand the comparable costs, interest rates and risks.
For example, a secured loan is often cheaper because the lender has a business asset as security and won't charge as high an interest rate. However, you stand to lose your asset if anything goes wrong and you can't repay the loan.
Unsecured lending is faster, easier to apply for, and usually more flexible. The pitfall is that costs tend to be higher, and you might be asked for a personal guarantee.
