Unsecured business loans
Added: (Fri Jan 06 2017)
Pressbox (Press Release) -
Itís a loan that doesnít require If you want a business loan without offering security, an unsecured business loan might be just what youíre looking for.
Small Unsecured Business loans are a great funding option for business that donít own many assets, businesses that would prefer not to offer security, or any company thatís growing fast and needs finance quickly.
With a variety of lenders on the market able to offer unsecured loans up to £ 250,000, there are options for a wide variety of situations. Read more to find out how an unsecured loan could help your business.
What is an small unsecured business loans?
Itís a loan that doesnít require security. A secured loan uses assets as security which means if things donít work out, the lender can sell the assets to recoup the cost of the loan. The question of Ďsecured vs. unsecured loansí is really all about risk for the lender.
Business loans without security
To consider a secured loan, you have to have security in the first place. But if you donít have any assetís, youíll need to get a loan without security-an unsecured business loan.
To These days,more and more companies are based on intangible assets for example, if youíre a software or consultancy company youíre likely to have a rented office, a few computers, and not mutch else in terms of tangible assets. Thatís where guaranteed unsecured loans come in.
In the world of alternative finance there are lots of lenders who can lend upwards of £ 100,000 unsecured even up to £250,000 in the right circumstances. Because thereís no security, trading history becomes more important and the lender might ask for a personal guarantee too.
Unsecured loans: considerations
Almost quicker Ė valuations necessary, legal process simpler
No assets required Ė more accessible type of finance
Up front cost lower, or sometimes not required at all
Overall cost usually higher, because the lender has a higher risk
Sometimes lenders will ask for a personal guarantee from a company director who wants an unsecured loan a personal guarantee from a company director who wants an unsecured loan-lenders occasionally prefer this arrangement because it lowers their level of risk. Although personal guarantees can feel like a big commitment, they often help companies secure higher levels of funding.