By taking security, the lender is much less likely to lose money should you fail to keep up the repayments
A secured business loan allows to you to access finance by offering up an asset such as property as security against the amount you borrow
If you’re a UK business with assets and you’re looking for capital to grow, then securing a business loan against one or more your assets could be the ideal way to raise the funding you need. This means you will be more likely to be approved for a secured loan, as well as be offered lower interest rates, longer terms, and larger loans for your business. Between the banks and the alternative finance market, there is a broad range of lenders in the UK, each offering a variety of lending products.
What is a secured business loan?
A secured business loan allows you to use an asset – or the total value of multiple assets – as security against the amount you borrow. The lender uses your asset(s) as a form of guarantee and is therefore often able to offer better repayment terms than you’d find with an unsecured loan.
Business loans are typically secured against property, equipment, machinery or land – but lenders might use any high-value assets that either you or your business might own. There are other types of secured lending though. For example, invoice finance allows you to use your invoices and accounts receivable (i.e. money owed to your business) as security for a loan.
With a secured loan, the security reduces the risk for lenders, therefore increasing your chances of getting a loan, but also allowing you to borrow more money, for https://paydayloansohio.net/cities/amelia/ a longer term – and you’ll be offered better interest rates compared to those for an unsecured loan. …