Business Finance Guides
What business borrowing costs, what lenders assess, and which product fits. Most of it comes back to one question: what will you put up as security?
The single biggest determinant of what business borrowing costs is whether it is secured. A property-backed business loan prices near commercial mortgage rates; the same business unsecured pays three to four times that. Most of the decisions in these guides come back to that trade, what you are willing to put up as security against what you are willing to pay.
Start here
If you are not sure which product fits, read the business finance decision guide first. It is a decision tree rather than a description, and it will usually narrow it to two options.
Then read the requirements guide, which sets out what lenders assess: turnover, profit, credit profile, security, and debt service cover.
Newer businesses
Limited trading history narrows the lender pool but does not close it. Asset finance, director-secured lending and government-backed schemes are all routinely available to businesses under two years old.
The startup finance guide covers the realistic options and what each will cost.
Business Finance guides in full
- Asset Finance Explained: HP, Lease and Sale-and-Leaseback
- Business Finance for Startups
- Business Loan Requirements: What Lenders Look For
- How to Get a Business Loan in the UK
- How to Get a Business Loan with Bad Credit
- How to Use a Revolving Credit Facility
- Invoice Finance vs Factoring
- Management Buyouts: How MBO Finance Works
- Merchant Cash Advances: Cost, Pros and Cons
- Secured vs Unsecured Business Loans
- The Director's Guide to Property-Backed Business Loans
- Which Business Finance Product Is Right for You?
- Working Capital: What It Is and How to Finance It
Frequently asked questions
How much can my business borrow?
Unsecured lending typically caps at one to three months of turnover, or roughly 10% to 25% of annual revenue. Secured against property it becomes a loan-to-value question rather than a turnover question, and facilities of several million are routine where the equity is there.
Do I need to give a personal guarantee?
On unsecured lending to an SME, almost always. On property-secured lending, often not, or only a limited one. A personal guarantee can frequently be capped at a percentage of the facility rather than the whole of it, and guarantee insurance is available. Both are negotiable and rarely negotiated.
Can I get a business loan with bad credit?
Yes, though the options narrow to secured lending, merchant cash advance and invoice finance, all of which look at the asset or the receivable rather than the credit file. Expect to pay materially more. If the business has property or a debtor book, use it.
Secured or unsecured - which is cheaper?
Secured, by a wide margin: roughly 6.0% to 9.5% APR against 9.5% to 18% APR unsecured, and the gap widens for weaker credit. The question is not which is cheaper but whether the saving justifies putting the asset at risk.
How fast can a business loan complete?
Unsecured facilities can fund in 24 to 72 hours from a clean application with open banking access. Property-secured lending runs to three to six weeks because it needs a valuation and legals. Merchant cash advance is usually the fastest of all at 24 to 48 hours.
What is a debenture?
A charge over the company's assets, either fixed on specific items or floating over the general pool of stock, debtors and equipment. It gives the lender priority on insolvency. Granting one to a first lender can block a second, so the order in which you take facilities matters.
Talk it through before you apply
Send the turnover, the purpose and what security is available, and we will come back the same working day with the products that actually fit and what each will cost.