Unsecured Business Loans
Does what it says on the tin! It is a business loan which is not secured against the company, property, asset etc.
What does it mean for your business loan to be unsecured?
When it comes to taking out an unsecured business loan, there are so many products on the market that it can sometimes be difficult to make the right choice.
There are also a wide range of lenders offering similar products, so it's important to make sure you're getting the best deal you can get. If you're thinking of applying for a business loan without offering security, it's worth taking into account the following considerations and weighing up the pros and cons
Business Loan Brokers - Unsecured Business Loans, what are they?
Whereas a secured business loan offers money on the basis of a tangible asset such as a property, lenders will want to see other types of guarantee for an unsecured loan. There are many reasons why a company may need an unsecured loan. For example, a start-up with a small online business that rents office space or works from home that wishes to invest in better technology, or a larger company looking to pay upfront rent and hire more staff. Perhaps the company is suddenly in higher demand and you need a cash injection to fulfil requirements.
Our Business Loan Brokers know there are lenders that offer loans of more than £100,000 if the business fits the right criteria although these are usually offered with a higher interest rate. However, the process is often quicker and there are less likely to be any upfront costs. This is because the loan application will be decided on factors such as the company's credit rating and previous earnings, so the lender doesn't have to carefully evaluate the collateral to determine the value of the loan. This can mean loans are secured with money in the bank in less than 48 hours from the point of application by one of our business loan brokers.
Unsecured Business Loan Broker
Because the lender perceives a greater risk, they will sometimes ask for a personal guarantee. While this may seem like a bit of a commitment, it helps to secure more funding and potentially lower rates. However, it could mean that your personal assets are at risk if repayments are not met. The lenders may take action through the courts to repossess any property you own, so this is worth considering. You are only obligated to pay from your own pocket if the business cannot meet repayments. Lenders usually look for a minimum of one year's financial accounts before agreeing to a loan.
Mortgage brokers are specialist Business Loan Brokers in helping to secure loans tailored to customers' needs, so get in touch to see how we can help you today.
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