Business finance
Personal Loan for Business
A personal loan is exactly what it sounds like, a loan you as the owner of the business take personally. This is one of the most straightforward ways to fund a start-up or very small company lacking operating history.
Loan size
$5K To $50K
loan term
1 to 5 years
Interest rate
8% to 20%
Approval speed
Medium
Personal Loan for business
Key features of a personal loan for business
Collateral would be your personal assets, often your home, and you are personally liable to pay off the loan. One of the advantages of taking a personal loan to fund your business is that if your credit history is strong, this may be a less expensive way to fund your business.
Compare a personal loan for business
Advantages and disadvantages
Advantages
What are the advantages of a personal loan for business
- Available for start-ups / new businesses
- May have flexible repayment terms
Disadvantages
What are the disadvantages of a personal loan for business
- May be expensive depending on personal credit rating
- Personal liability for repayment
Common uses & good to know
Everything else about a business line of credit
Common uses
A personal loan is often the best option for funding a start-up or small business without sizeable operating history.
If your business is struggling and you believe a cash infusion would help turn things around, a personal loan for business may also be a cheaper method of funding.
Good to know
Be aware that a personal loan will mean that you are personally liable to repay the loan should your business fail.
The amount you are able to borrow as well as the interest rate charged will depend on your personal credit rating.
The cost of this loan can also be minimised if you have personal property or other assets to pledge as collateral.
Alternative Commercial Lending options
Other Business Finance Products
Secured Business Loan
A secured business loan is a loan made by a bank or finance company where the lender requires the borrower to pledge assets as collateral against the loan.
Business line of credit
A business line of credit is a very flexible form of lending where you have cash available to draw down on as and when you need it.
Trade finance
Trade finance is any form of finance that is issued to support international trade, including letters of credit, debtor finance, & export credit.
Using Debtor Finance to Manage Business Cash Flows
Any business owner knows the importance of managing cash flows to ensure that liquidity remains strong and that the business has the ability to take advantage of sudden growth opportunities or big contracts. Late payments impact businesses severely as cash that could otherwise be reinvested in growing stock, marketing or
Personal loan for business FAQ
Frequently asked questions
If you apply for a personal loan for your business, lenders will focus solely on your personal characteristics such as your credit score, your income and what assets you own that you can post as collateral.
Lenders will not take your business into consideration so you do not need to prepare financial statements etc related to your business.
