What are Business Loans?
Business loans can be used for a variety of different business reasons such as purchasing stock, securing property, maintaining stability in your business, or funding growth plans. There are a wide range of business loans available on the UK market. Whatever the size of your business there are likely to be funding options open to you, whether you’re looking for £1,000 or £1,000,000.
So, whether you're starting a new venture, looking to grow your existing business, or if you need help with cashflow issues - a business loan could be the right funding for you.
Types of Business Loans
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Unsecured business loans don’t require you to use an asset as collateral. This means that your business assets are not at risk. But without collateral there is more at risk for lenders offering unsecured loans, so the loan rates are typically higher.
How do Business Loans work?
Business loans can typically be placed into one of two categories:
- Secured Business Loans
- Unsecured Business Loans
It’s important to get the right advice before you decide which loan is right for you and your business.
Business loans are available for businesses at all stages, and of all sizes.
However, it’s important to get the right advice before taking on a loan for your business. The amount you borrow, the repayment term, your business credit score and any assets you might use to secure the loan can all impact your loan rate and the amount you repay.
Some loan providers might want to review your business accounts, trading history and your business credit score before deciding on your loan application. You will need to ensure your business accounts have been filed and are up to date before applying for funding.
But if you’re a start-up, don’t worry - there are specialist start-up loan providers that can help provide access to funding for newer businesses that don’t have trading history information available.
Find a Business Loan for Your Business
Choosing the right type of loan for your business is critical. You want to make sure that you’ve evaluated all the options and that the details of your loan are suitable for your business.
Yet with so many different business loans available on the UK market, choosing the right provider can be daunting.
That’s where THEDIRECTORSCHOICE.COM can help.
We only partner with funders that have experience in helping businesses just like yours. So, you can rest assured that our panel of funding experts are experienced and qualified to offer you the business loan advice you need.
FAQs
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There are so many different types of business loan available. Deciding which one is right for you can be tough.
This is why it’s important to speak to one of our specialist funders who can help you decide which type of business loan is best for you – whether that be a secured or unsecured loan, for example.
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Nearly all lenders will need you to provide some personal and financial information before they process your application. The typical information they will request is likely to include:
- Business name and contact details
- The year you started your business
- Your annual turnover
- Up to date business accounts
- Current list of assets
- The amount of funding you’re looking for
- How you plan to use your loan
- Homeowner status
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It can be more challenging to find an appropriate lender for sole traders, but it is possible for a sole trader to qualify for a business loan.
Some brokers specialise in finding business loans for sole traders.
With the right advice from one of our trusted experts, you should be able to find funding to suit your needs.
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It all depends on your circumstances and the industry you work in. It’s worth getting professional advice from one of our experts.
If you’re a start-up, you might also want to investigate if you’re eligible for a government backed start-up loan. In addition to providing funding, the scheme also provides access to business support and advice.
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How much your business is able to borrow depends on your trading history, financial standing and a variety of other factors.
We have funders that can provide businesses with loans ranging from £2,000 to £1 million+. We have funding solutions available for all business needs.
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This is a tough question to answer as it varies by lender and is also influenced by your individual business circumstances.
Speak to one of our trusted funding experts to discuss rates.
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If you cannot repay your business bank loan, it is important that you speak to your lender in advance, as the next step may be to incur late payment fees, interest and in some cases administration costs for each payment that you miss. They are more likely to work with you if you let them know ahead of time.
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Depending on your circumstances, other forms of business finance might be more suitable for you than a business loan. Invoice finance uses the value of your invoices to allow access to cash quickly, asset finance allows you to secure finance against assets within the business, and bridging finance may be a better alternative for short-term funding.
Speak to one of our finance experts to decide which solution is right for you.
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As a business owner, it can sometimes be difficult to find support and guidance you can trust.
THEDIRECTORSCHOICE.COM brings a panel of trusted business finance experts together in one place and helps you find the perfect match for your business needs.
Get in touch with our experienced business finance experts to find out if they are the right fit for your business, and if a business loan is the right decision for you.