Yes, it is possible to obtain an unsecured business loan, but simply put, it all depends on your individual and business circumstances. There are alot of factors to assess before saying yes, no or even maybe!

In our experience, unsecured business loans don’t generally require collateral, such as property or assets, to secure the loan. Instead, the business loans are approved based on the your creditworthiness, business revenue, credit history, and other financial factors.

Because they are not backed by collateral, unsecured loans typically have higher interest rates compared to secured loans and might have stricter eligibility requirements. It isn’t uncommon for rates to raange from 7% to 24%!

Here are some types of unsecured business loans you might consider:

Term Loans: These loans provide a lump sum amount that is repaid over a set term (1 to 7 years) with regular payments. They might have fixed or variable interest rates. fess are usually charged by the lenders so keep this in mind. This type of unsecured credit is our bread and butter in the commercial lending market!

Invoice Financing: This involves borrowing against your outstanding invoices. The lender provides you with a percentage of the invoice amount upfront and collects the full amount from your customers. Once the customers pay, you receive the remaining amount minus the lender’s fees. The lenders will generally offer around 50% of the pending invoice amount.

Peer-to-Peer (P2P) Loans: These loans involve borrowing from individuals or groups online through platforms that connect borrowers with investors willing to lend money. We don’t get involved in this sort of lending, but it has become a popular way of raising capital. Just make sure you do your due dilgence and check the risks!

When applying for an unsecured business loan, we will assess your credit history, business financials, cash flow, profitability, and other relevant factors to determine eligibility and the terms of the loan. This means that even before we go to the lenders we can determine the terms of business they offer and ensure you continuity of advice.

For more information about getting an unsecured business loan and researching the different types of finance available for you and your business nees, contact our dedictaed commercial loan advisers on 0117 251 0563.