What is an Unsecured Business Loan?
Secured loans are the most common form of business loans extended by lenders. A secured loan requires the borrower to pledge assets as collateral. This help lenders increase their fund security. Due to the nature of most collateral requirements for loans, a lot of small business owners find it difficult to provide the collateral required to obtain a loan. However, some lenders are ready to fund businesses loans without collateral. This type of fund lending is known as an unsecured business loan.
An unsecured business loan is almost directly opposite to a secured business loan in terms of its qualification requirements. It does not require any form of collateral before it can be approved. This makes life easy for credible small businesses that find it difficult to provide collateral. An unsecured business loan is given strictly on the credibility of a business. Typically, in order to obtain an unsecured business loan, you must have a good credit score. This will help the lender have faith in your ability to pay back your debt.
How Does an Unsecured Business Loan Work?
Typically, an unsecured business loan works in an opposite way to a secured business loan. An unsecured loan does not require any collateral, and approval is solely based on the performance of a business in terms of its credit score. An unsecured business loan is a great risk for lenders, which is why it comes with a higher interest rate. The interest rate of an unsecured business loan can be twice as high as that of a secured business loan.
Sometimes, borrowers might be required to provide a personal guarantee in case of a default. A default can occur if a borrower fails to pay back the principal amount borrowed and its interest. The lender will connect with the guarantor if the borrower is not committed to paying the debt back within the stipulated time.
Available Options of Unsecured Business Loans
Unsecured business loans can come with several financing options or packages, ranging from credit card loans to payday loans. Still, they can all generally be categorized as term loans or revolving loans.
Term loaning is a common type of secured business loan. It is also available as an unsecured business loan. A term loan is a loan that has a defined repayment schedule. The repayment duration, monthly repayment amounts and fixed interest rate are often specified in term loans.
As the name suggests, a revolving loan is a loan that allows a particular amount of money to be withdrawn and repaid by a borrower in a continuous manner until the arrangement expires. In essence, a revolving loan allows you to use funds whenever they’re needed, after which you’ll pay them back (and reuse them, if need be).
Requirements for Unsecured Business Loans from Globelend Capital
An unsecured business loan from Globelend Capital is very easy and fast to obtain. You should know the following things about our unsecured business loans:
You are not required to provide any collateral before your loan is approved. This is similar to every unsecured business loan provider. Our unsecured loans are easily accessible. In just a few days, your loan can be approved and paid to your business bank account.
No Strenuous Documentation
You’re not required to provide any major documents before your loan can be approved. A statement of cash flow (to enable us to examine the financial performance of your business) might be required. Our unsecured business loan is a go-to financing option for small businesses in need of quick funding.
Good Credit Score
For you to qualify for our unsecured business loan, you must have a good credit score. This will help us get an impression of how reliable you can be in terms of debt repayment. You can build your business credit score to give you a higher chance of obtaining an unsecured business loan.
Personal Guarantee Required
At times, you might be required to provide a personal guarantee. This generally helps lenders lower the risk associated with an unsecured loan. Your guarantor could be a trustworthy person in your line of business.
Apply for an Unsecured Business Loan from Globelend Capital
Globelend Capital offers amazing unsecured business loans that range from $25,000 to $500,000. The loan can go higher than that, depending on the agreement reached. At Globelend Capital, we are aware of how worrisome it can be for small businesses to be denied a loan because of a lack of collateral. On the other hand, we know how important it is for your small businesses to have unlimited access to quick loans for continued business growth. This is why we offer amazing unsecured business loans – to help businesses move forward.
Our easy-to-obtain unsecured business loans come with relatively fair repayment terms and interest rates. Generally, unsecured business loans are known to have higher interest rates, but ours is fairly low, with a repayment duration of up to 5 years. Globelend Capital is very simple and transparent in its process, and you can count on us for your unsecured business loans anytime. Apply to our unsecured business loan today to enjoy our amazing offers.