Successfully Funding Thousands Of UK Limited Companies Since 1989
Require Immediate Support? Helpline 0800 056 0410
Secured loans and commercial bridging loans are similar financial products but there are notable differences that mean it’s important to carefully consider your business’s needs before applying.
Secured loans can be used for a multitude of purposes and are generally a good option for asset-rich businesses because one or more assets must be provided as collateral. This considerably reduces the lender’s risk and can open up access to lower interest rates.
Commercial bridging loans are a short-term form of funding that literally ‘bridge the gap’ for borrowers financially. A bridging loan is more appropriate if a business is purchasing a property but hasn’t completed the sale of its existing one. In this case, the bridging finance enables them to proceed with the purchase.
Loan term
Time to obtain
Focus on collateral
Interest rates
Whether a secured loan or a bridging loan is more appropriate depends on the purpose of the financing and whether it’s to provide short-term or long-term financial support for your business activities.
You may be able to obtain a secured loan with a low interest rate that allows your business to grow by investing in a property or other type of asset over a longer term. A secured loan offers financial stability to a business, as repayments are predictable and fixed.
If your financial needs are time-sensitive, however, a bridging loan is likely to provide the rapid and flexible access to funding that you need – perhaps to secure a commercial property without having to wait for your sale to go through.
UK Business Finance are commercial finance brokers with extensive experience in helping businesses access vital funding. We can guide you towards the best type of finance for your needs and offer our services free of charge. Please get in touch to find out more.
We work across a wide range of sectors throughout the UK, providing specialist advice to each sector.
Why use a commercial finance broker?
A commercial finance broker plays an important role for businesses looking for funding. They can source the most suitable types of finance using a whole-of-market search strategy whilst also accessing the best deals and lenders.
What are cash flow forecasts and why are these important when obtaining business funding?
Operating with positive cash flow helps your business to pay its bills, conduct day-to-day trade with minimal issues, and plan confidently for the months and years ahead. But how do you know that there will be sufficient cash available when it’s needed?
Good debt vs Bad debt
Managed well, debt can improve your credit rating, enable expansion, and stabilise cash flow. It’s the backbone of growth but with so many different types of borrowing now available, it’s important for your business to carry ‘good debt’ rather than ‘bad debt.’
How to best prepare my company for a finance application
When preparing your company for a finance application, it’s key to present the business in its best light whilst also providing realistic projections, your plans for the funding, and how it will help the business grow.