Business Loans explained

A business loan is a very flexible way to fund a range of projects. With our platform, we can help you find and compare the leading lenders easily.

Have the facts before you apply
A business loan is credit, usually in the form of cash, that you borrow and repay over an agreed length of time. Banks and alternative funding sources, such as community development finance institutions, crowdfunding platforms and even friends and family can provide businesses with loans.

In addition to repaying the amount you are borrowing, you will need to pay interest subject to the following considerations:
  • the length of the loan
  • the total amount you borrow
  • whether the loan is ‘secured’ – e.g. if you own your home and agree to transfer ownership to the loan provider if you don’t keep up your payments
The interest rate can either be fixed for the duration of the loan or can be variable, meaning it will change subject to other factors, for example the Bank of England base rate.
Advantages of a business loan

Advantages include:

  • unlike overdrafts, loans are not repayable on demand – this means you can plan ahead more reliably for the whole term (often between 1 and 5 years)
  • loans can be tied in with the lifetime of the equipment or other assets you are looking to purchase with the amount you are borrowing
  • you won’t have to give the lender a percentage of your profits or a share in your company
Disadvantages of a business loan
Disadvantages include:
  • loans are usually not very flexible – e.g. you may have to pay additional charges if you repay early
  • you might struggle to meet monthly payments if your customers don’t pay you
  • if your loan is secured against your personal property or assets (e.g. your home) you could lose them if you don’t keep up the payments
  • the cost of repayments for variable rate loans can change, making it harder to plan your finances
  • Borrow
    From £1,000 to £5 million or more
    From 3 months to 5 years
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    Finpoint is staffed with impartial finance experts that speak your language and are always ready to walk you through the pro’s and con’s of each option before you proceed. Decide without any pressure, safe in the knowledge you got the best funding solution for your business.

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    Watch our short video to learn more about Finpoint or feel free to visit our Frequently Asked Questions section.

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