Unsecured Funding for Business

Just when you thought you had a handle on your business, a global pandemic comes along and turns the global economy upside-down. Yes, the current situation has affected millions of small businesses, but you’re not ‘everyone’ and you still need to keep your business afloat and your family fed. 

 

Perhaps you’ve looked into various options to keep your chin above water until things settle down a little, and if so, then you’ve no doubt come across some information on unsecured funding for businesses. 

 

It can be a bit of a rabbit hole though, don’t you agree? 

 

We’d like to offer simple answers to the most commonly asked questions around unsecured business loans so you can ascertain whether this course is right for you. 

 

 

 

The UK government has made funds available for distressed companies in this torrid time, notably those impacted by COVID-19. Let’s find out what this is all about. 

 

 

An unsecured business loan is one which does not require security to qualify. In most cases, a business loan requires that you offer security in the form of tangible business assets (i.e., invoices, property, machinery, etc) or your personal assets. 

 

An unsecured loan is exactly that; one which does not require security to qualify. Essentially, the lender carries the risk in this transaction. 

 

Unsecured loans are available from £1,000 to £350,000 and are normally backed up by a businesses’ trading position. As an example, some lenders specify the loan amount as a multiple of turnover which allows them to make a fair estimate on your businesses’ future based on the recent past. 

 

 

There are numerous benefits to unsecured funding which include: 

 

 

 

It makes good business sense to keep a close eye on company costs. For example, using an unsecured loan to consolidate more expensive loans is a simple and sensible way to reduce costs. 

 

Some small businesses make use of this vehicle on a short-term basis to buy stock to accommodate seasonal trading peaks. 

 

Perhaps you’re planning on investing in updated equipment or software, or you’re considering expanding into a new market to future-proof your earnings? 

 

Of course, in this uncertain time, we may simply need some cash to carry the salaries or office rental until we can trade again. 

 

 

The requirements are reasonably straightforward. 

 

 

 

If this is the case, then please get in contact with us anyway. There are circumstances where certain concessions can be made, and a frank conversation may unlock another way forward for you. 

 

 

The world of lending may seem muddy at times, with too much small print and too little information. 

 

Whilst we are in a changeable financial situation, we may be reticent to take on further responsibilities, and yet another outgoing may feel counterproductive. 

 

Whatever your feelings on this matter, we know that you will be far more comfortable having all the facts at your disposal. So please, get in touch with us and let our team offer some advice on unsecured funding in this troubled time.