What are Secured Loans?Published on 1st December 2017 2017-12-01T00:27:34+00:00 - Last update on 4th July 2020 2020-07-04T21:06:23+00:00
For both developing and established businesses, a Secured Business Finance solution could provide the funds necessary for further success, growth and sustainability. They offer a way of accessing external funding opportunities through the use of valuable business assets. But what does this actually entail, and could it benefit your business?
To offer greater clarity on the subject, we will be discussing the nature of Secured Loans and the types of products that are on offer to your business, including Secured Business Loans, Invoice Finance and Asset Refinance.
What is a Secured finance product?
Depending on your chosen finance solution, a secured product is one that uses your physical or financial assets as security against the loan. This reduces the lender’s risk and gives them greater confidence when lending to your business because, should your business default or become unable to repay the product for any reason, they can seize control over these assets to recover their losses. On the plus side, offering up assets as security could help reduce the total cost of finance, compared to an unsecured agreement.
Got valuable assets logged in your business’ balance sheet? Need access to additional funds? Why not apply for a Secured Business Finance solution today, or learn more about how your business could benefit?
What do I need to apply for a secured Business Finance product?
Although lending criteria can differ from product to product, what unifies them is the need for you to provide assets have that high a resale value as collateral. With Secured Finance you’ll also need to present lenders with your credit score and business history, including those belonging to any associated directors and partners.
However, other products can take a slightly different approach in their lending criteria. Although products covered under the collective term Invoice Finance are considered as secured finance solutions, you typically aren’t required to use physical assets as security. Instead, lenders use your receivables, or rather the money owed by your customers in relation to any unpaid invoice worth in excess of £5,000, as security. Plus, although you still need to present your credit profile, possessing poor credit usually isn’t used as an excuse to turn your business away.
How can I use the funds?
Because of the variety of products on offer which are classed as secured, you’re able to use the funds in whichever way you see fit. Depending on the product you choose, you could use the funds to complete business projects, undertake refurbishments or even fund asset purchases. As such, use the cash for whatever you think suits your business’ needs.
Looking for Secured Business Finance?
Sourcing the most appropriate finance solution for your business can be quite a handful for any business owner. There are so many products on offer and plenty of lenders to choose from, so how can you be certain you getting value for money? Carrying out the necessary research and price comparisons can time away from your business, a precious commodity that you may not have. But if you’re looking for a Secured loan at a competitive rate, or simply wish to know more, help is at hand. If you want to acquire business finance today and are willing to offer assets as collateral, apply for a Secured Business Loan today, or find out more.
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