If you want a business loan without offering security, wither against your own assets or those of your business, an unsecured business loan might be the right option.
Unsecured loans are therefore a great financing option for businesses that don’t own many assets or are 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.
With more and more businesses based on intangible assets — for example software - or those who's assets walk out the door at the end of the day - such as a 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, the interest rate is usually higher and the lender might ask for a personal guarantee too.
Unsecured loans summary
- Usually quicker — no valuations necessary and a simpler legal process
- No tangible assets required — accessible to more businesses
- Up front costs usually lower for the same reasons as they are quicker
- Lifetime cost usually higher, because the lender has a higher risk