Business financing simplified

Secured Business Loans

Business financing simplified

Secured Business Loans
in a nutshell

Secured business loans are a way for companies to secure funding by using assets as security. Since lenders typically use high-value assets such as property to secure loans, it means they can lend more in comparison to unsecured business loans. Because the lenders are using assets to secure the loan, often they won’t need to scrutinize personal credit as vigorously as an unsecured loan nor will the business need to be profitable. Further, the pricing is likely to be lower if the business is able to put up tangible security.

With a secured loan, lenders are collateralised on the asset thus increasing your chances of getting a loan and also allowing you a longer term on the facility; after all the loan value will be primarily derived from the available equity the asset holds. 

The key term with secured loans is “loan to value” (LTV) which pertains to (typically a percentage figure) the value of the loan against the available collateral. The LTV a lender is willing to offer is usually determined by what rank the lender will hold on the property – LTVs typically increase if the lender has sight on the first charge of the property as opposed to a second (or third) charge where they will rank junior to the first charge holder.

Some of our lenders

Cost

Secured loans give the lender more protection and as such they can charge lower interest rates than with other products.

BENEFITS

Light criteria

As the lending is collateralised, personal and business credit is scrutinised less than unsecured loans.

BENEFITS

More money

The loan value is not determined by the performance of the business, but the value of the asset, so the lender is likely to offer more than otherwise.

BENEFITS

Increased terms

As the collateral is there, lenders will issue longer terms on their loans - meaning there is likely to be lower monthly repayments and thus a cash flow benefit.

BENEFITS

Who is Eligible?

  • Any credit profile.
  • Borrower must be a homeowner.
  • Businesses with unencumbered assets on the balance sheet.
  • Profitable or loss-making businesses.

How does it work?

1. Application: To get indicative terms, you will need the asset/property value, how much current debt on the property, what the use of funds will be and your own personal and business details

2. Valuation: The asset will be valued, either on site or remotely (depending on size and LTV) – giving a maximum amount you would be able to borrow.

3. Funding: Pending the valuation and documents, funds are available for drawdown quickly after completion.

How Much Does It Cost?

FAQ's

Yes because the lender is asset secure there is still a possibility you will be eligible.

Yes, lenders can take a second charge usually at a lower loan-to-value.

Yes, so long as you have got an asset that has equity, the business doesnt matter too much.

As a rule of thumb, up to 70% LTV, although this can go up and down a little bit depending on the asset and other factors.

Qualifing questions

Can I Borrow?

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Get Invoice Finance

Please pop your details in the form below and we’ll get back to you within 24 hours.

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