Have you ever heard about secured small business loans? If you are looking for a business loan, you may have noticed that there are different loan options to choose from.
What are secured small business loans? And how do they work? What kind of benefits they can give to your company?
How Secured Small Business Loans works
Secured Business Loans allows you to cover any business needs by submitting a form of collateral to receive funds. A secured small business loan is secured against an asset that you have, and if you are unable to repay the loan, the lender has the right to take your asset to pay your debt. Typical forms of security are a residential or commercial property, vehicles, machinery, or other equipment. The interest rate is lower compared to an unsecured business loan. In fact, these type of loans with security are easier to obtain because are less risky for the lender.
Best 5 benefits of a Secured Business Loan
Secured business loans are one of the preferred financial solutions for many businesses. Lending Connect has many partners that offer this type of credit option.
Here the top 5 advantages of secured loans:
- Lower Interest Rates: one of the top benefits of this secured loan. Getting a secured loan is faster and easier than an unsecured loan. The asset given as security allows the lender to provide a lower interest rate because the risk is limited.
- Access to higher loan amounts: the risk for the lender is lower than an unsecured loan and for this reason can offer you more money to borrow. With a good credit score and a solid business plan, you will easily get your loan.
- Quick access to the funds: you usually get your funds within 1 day from the approval process if the borrower meets the eligibility criteria.
- Long term repayments: the loan period depends on many reasons and on the assets that you use as security. This loan has longer repayment terms than an unsecured business loan (from 3 to 60-months term). It is possible to negotiate the repayments amount and terms.
- Expanding Business Opportunities: a secured loan is ideal for business owners who want to expand their business and take it to the next step.
Despite the many advantages of this loan, many Australian businesses don’t want to take the risk of providing collateral, and therefore they often choose an unsecured business loan.
Do you want to apply for a business loan?
At Lending Connect, our experienced team can help you to choose the best finance options for your business needs.
Secured business loans or unsecured business loans? Which one is right for you?
It is difficult to say if a secured loan is a better option for you because it depends on your current financial situation and business needs.
We can assist you through the application process and analyse if you are qualified for a secured business loan or an unsecured loan. See if you qualify.