How To Get A Small Business Loan + What To Know

A small business loan is a form of business financing that enables small businesses to fund their daily operations costs. The loan is often provided by a lender or a high street bank and is usually secured against an asset, or unsecured. If you are yet to open a business bank account, it it worth checking whether you are likely to approved for a loan before applying as being declined can affect your credit score. Traditional bank loans and overdrafts are still a popular source of funding for many businesses and start-ups. Used properly, they provide a simple and effective way of financing the growth of your business.

This provides the lender with more certainty because if the loan isn’t repaid they can claim ownership of the asset from the business borrower. Fixed monthly repayments may help to minimise the impact of a large purchase on your day to day cash flow. We can take your business loan application over the phone, or answer your questions about applying online. Some lenders will also allow a business owner to take an unsecured loan to help buy out a co-owner. Sometimes such lenders will want to see a Share Purchase Agreement drawn up, to demonstrate you are serious about the move. If you’re in doubt, contact your preferred lender directly and ask them what situations they’re willing to cover.

In many cases, we can let you know upfront whether you’re likely to get the business lending you want – with no impact on your credit rating. If you already have a business account with us, you can log in to see any business lending limits you have. We’ll tell you what your loan rate is before you apply – this won’t affect your credit score. A business loan is a straightforward way to finance your business. If a business opportunity presents itself, but you need substantial funding to take it up, we’re ready to help you explore if it’s right for your business. come in a variety of forms, the main two types are secured business loans and unsecured business loans. Previously, small businesses could turn to business overdrafts to cover gaps in their cash flow. Overdrafts are getting increasingly difficult to secure, so an alternative source is revolving credit.

Depending on how much business finance you require and your business’ circumstances, you could be eligible for a business loan of anywhere between £1,000 and £15M+. How much you can borrow will also depend on the lender, and you should only take out a business loan if you have a solid plan for paying it back . With this in mind, it’s possible that you may be able to get a small business loan even if your credit history is chequered. You can also check out our article on 5 ways to improve your business credit rating for tips. The amount you can borrow is based on what the lender thinks your business can afford and it will conduct a credit check.

New businesses can sometimes struggle to apply for loans because they have little or no evidence of their ability to pay off debt. Some providers require a business to be trading for two years to be eligible for a business loan. Applying for a small business loan takes 2 minutes via our simple online application form. You could be approved by one of our trusted lenders in a few minutes. Once approved, the funds could be transferred to your account within hours. More often than not, when applying for a small business loan you will need to be prepared to sign a personal guarantee.

A small business loan is, unsurprisingly, a loan that is offered to small businesses. Small business loans differ from other loans because they’re tailored specifically to the needs of small businesses. So the rates available, as well as the repayment terms, are generally better suited to smaller businesses.

Please be advised that the amount of money you want to borrow will need to be equal to the value of the item you’re offering as security. Representative APR is used for comparison purposes and shows the annual interest rate we expect at least 51% of customers who are accepted for and enter into a loan agreement with us to get. APR takes into account not just the interest on the loan but also other charges you have to pay, for example, any arrangement fee. Our rates depend on your circumstances and loan amount and may differ from the Representative APR.