Unsecured business loans
If you want a business loan without offering security, an unsecured business loan might be just what you’re looking for.
Unsecured loans are a great funding option for businesses that don’t own many assets, businesses that would prefer not to offer security, or any company that’s 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 unsecured business loan?
It’s a loan that doesn’t require security. A secured loan uses assets as security — which means if things don’t work out, the lender can sell the assets to recoup the cost of the loan. The question of ‘secured vs. unsecured loans’ 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 don’t have any assets, you’ll need to get a loan without security — an unsecured business loan.
These days, more and more companies are based on intangible assets — for example, if you’re a software or consultancy company you’re likely to have a rented office, a few computers, and not much else in terms of tangible assets. That’s where unsecured business 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 there’s no security, trading history becomes more important and the lender might ask for a personal guarantee too.