There are two main types of business loans: secured loans and unsecured loans. A “secured” loan is one that is backed by your assets. This means that if you fail to make your repayments, the lender can seize the asset you agreed to provide as security (like your car or your property) and use the money to pay back your loan. With an unsecured loan, you don’t need to provide any of your assets as security, but this means the lender generally won’t be inclined to lend you as much money. (For more info on loans, check out our secured and unsecured loans
To get an idea of long you need to pay back the money you borrow, you’ll need to figure out how much you need and how much you can repay each month. If you need a larger amount which may take you longer to pay back, the lender will probably require an asset for security.
An unsecured small business loan will generally need to be paid back within 5 years. However, if the loan is secured with a residential property, the borrower may be able to take up to 30 years to pay the loan back.