Why is it called unsecured business loan?
Unlike its counterpart, an unsecured business loan doesn’t require any collateral, which means other factors are used to determine if a business can be granted with this type of loan or not.
Usually, secured loans will require you some assets or properties to act as security for the lender in case you’ll not be able to repay your loan.
But if you’re getting an unsecured loan none of these stuff matters, and you don’t have to put any of your assets to unnecessary risks, which is safer for your small business. It also makes the whole process of getting funds for your business easier and less risky in so many ways.
This is the main reason why so many business owners in both Australia and New Zealand are choosing this type of loan for their businesses.
Benefits of getting an unsecured business loan
Getting an unsecured business loan is the best decision that you need to take if you’re looking to improve or scale up your business. But there are several benefits that you can also get when you choose this type of loan.
- The fast application process for small business loans
Unlike secured business loans, the application process for unsecured loans is much faster because there is no collateral involved in this type of loan.
As a matter of fact, you waste a lot of time in getting a secured loan since there are lots of requirements that you need to fulfill first and it drags on than most companies might like. For most small business owners, the ideal way to go is unsecured loans because the application process is much faster.
In fact, you can get approved in a very short time, so you avoid any trouble or annoyances in the process.
- Better and quicker response from lenders
Another significant benefit of unsecured loans is the response times you get from lenders. It is much quicker to get your unsecured business loan application get approved because lenders can quickly assess your application and if you meet all the requirements, then they can easily lend you the money in a matter of days.
You don’t need to wait for a very long time before you find out if you’re going to be approved or not for that particular loan, and I think it is one of the major benefits of unsecured loans.
- You don’t need collateral to get a loan
The main reason why so many small business owners are interested in getting unsecured business loans is the fact that they don’t need collateral to get their application approved.
It’s actually obvious that I highlighted this feature before, but it clearly matters since there is no pressure weighing you down and you don’t have to be worry that your asset might potentially be lost to the lender if you fail to make repayments.
That is why if you don’t want to take a risk especially if it involves your property, then an unsecured loan is the best type of loan for you, because it will allow you to avoid any risks associated with secured loans.
- Building a positive credit score
When you take an unsecured loan, and you pay it off on time, then you’ll also be building a positive credit score in return.
As you may already know, there are lots of companies with poor credit, but this can be reversed by getting an unsecured loan and paying it on time since lenders will most likely reward companies who pay their loans on time.
In fact, when you meet regular repayment deadlines, then this clearly shows that you are on top of your financial obligations, and this will help you build a better credit score for your company.
What are the requirements for getting an unsecured business loan?
There are some requirements that you need to fulfill before you can take out an unsecured business loan. Although these requirements are not too restrictive or harsh, but you need to know more about it.
- You need to pay the loan back in 24 months
If you decide to take out an unsecured business loan from Bizzloans, it’s essential that you pay the loan back in 2 years or 24 months. Unlike its counterpart, the maximum term for an unsecured loan is just 2 years.
However, this is not a problem for small business owners, since they can easily monitor their finances. We’ll also provide you all the details you need so you know exactly what you’re signing up to.
- You’ll need to submit your business bank statements
In order for us to know if your business is in a financial position to take on a loan based on your application, we will require you to submit your business’s bank statements.
This will enable us to know your capacity to repay your loans and for us to lend responsibly, so we don’t burden you with a debt that is too much for you to take on.
So, we’re doing this for your best interest and for us to know that you can handle the loan that you take on.
Another important thing we need from you is your photo ID because we will use this to verify your personal identity and to know for sure that you are who you say you are.
Honestly, this is common practice by most lenders to sure that all finance transactions are above board and in order.
So, once we are satisfied with your application, then we will grant you the loan you need for your small business.
Overall, getting an unsecured business loan for any type of small business can be just what you need since it’s much safer and your assets are more secured. Most importantly, you’ll be accepted much faster.