Secured business loans in the UK, priced against unsecured
A secured business loan is worth it only when the interest saved beats the fees and the risk to your property: across our partner's panel secured rates run 6% to 22% a year against 7% to 44% unsecured, and on £100,000 over five years the middle of each range differs by £15,257 in interest. On £25,000 over three years the gap is only £2,158, which valuation and legal fees can swallow.
Lender figures checked 1 November 2026; panel ranges checked 1 September 2026.
What a secured business loan is
The lender takes a legal charge over an asset, so if the loan is not repaid it can sell the asset to recover the debt. In return you get a lower rate and longer terms: up to 10 years on our partner's panel, against NatWest's unsecured 1 to 7 years. Property is the usual security. Equipment and vehicles are normally financed through asset finance, where the item itself is the security.
Security and a personal guarantee are different things. A guarantee makes a director personally liable without a charge on a specific asset. Under the Growth Guarantee Scheme, principal private residences cannot be taken as security, but personal guarantees can be taken at the lender's discretion.
Secured vs unsecured on £100,000
£100,000 over 60 months, priced at the middle of each panel range. These are illustrations, not quotes:
| Loan | Rate | Monthly | Total interest |
|---|---|---|---|
| Secured | 10% | £2,124.70 | £27,482.27 |
| Unsecured | 15% | £2,378.99 | £42,739.58 |
The arithmetic: £42,739.58 − £27,482.27 = £15,257.31 over five years, or £254.29 a month. Take off the valuation and legal costs on your quote, which lenders set case by case, and what is left is the true saving.
Now the smaller loan: £25,000 over 36 months costs £4,040.47 secured against £6,198.80 unsecured, a gap of £2,158.33. Ask for the valuation and legal costs in writing: if they come close to that gap, keep your property out of it and borrow unsecured.
Bridging loans for a short gap
Bridging loans are secured on property and priced by the month: 0.55% to 1.5% a month on our partner's panel, over 3 to 24 months. On an illustrative £200,000 for 6 months at 0.9% a month, interest is £200,000 × 0.9% = £1,800.00 a month, or £10,800.00 over the term, before fees. Bridging only makes sense with a clear exit, such as a sale or a longer-term mortgage, lined up before you borrow.
When a secured loan makes sense
- Buying premises or land, where the property bought is the security.
- Six-figure borrowing over long terms, where the rate gap compounds year after year.
- Refinancing expensive short-term debt, if the saving clears the fees.
- Not to cover trading losses: securing debt you cannot service puts the property at risk for no gain.
Compare before you put up security
Price the unsecured route first: Funding Circle lends £10,000 to £750,000 unsecured to limited companies from 6.9% a year, and NatWest publishes a representative 12.57% APR. Our business loans guide, the bank business loans comparison and business loan interest rates set out the alternatives, and compare business loans prices the same loan across lenders. Taking card payments? A free statement review can free up cash before you borrow.
Price secured and unsecured side by side
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Secured business loan questions
Can I get a secured business loan?
If the business or its owners have an asset a lender will take a charge over, usually property, yes. On our partner's panel secured rates run 6% to 22% a year over terms of up to 10 years. The lender will still look at whether trading profit covers the repayments; security lowers the rate, it does not replace affordability.
Should I get a secured business loan or an unsecured one?
Work out the saving first. On £25,000 over 36 months the middle of each panel range differs by £2,158 in interest, which valuation and legal fees can swallow. On £100,000 over 60 months the gap is £15,257. For smaller sums, take the unsecured loan.
What can I use as security for a business loan?
Commercial property you own, residential property, equipment and vehicles (usually through asset finance rather than a loan), and in some cases a charge over the company's assets as a whole. Under the Growth Guarantee Scheme, principal private residences cannot be taken as security.
Can I get a business loan to buy property?
Yes, as a commercial mortgage or, for a short gap such as buying before a sale completes, a bridging loan. Bridging on our partner's panel runs 0.55% to 1.5% a month over 3 to 24 months. Long-term property purchases sit in the secured range of 6% to 22% a year.
Can self-employed people get a secured loan for the business?
Yes. A sole trader borrows personally, so the security is usually your own property and the debt is yours, not the business’s. The risk warning on this page applies directly: if you do not keep up repayments, the lender can take the property.
What rates do secured business loans charge?
Lenders price each case, so there is no single published rate. Across our partner's panel (checked 1 September 2026) secured loans run 6% to 22% a year, against 7% to 44% for unsecured. Where you land depends on the asset, the loan to value, your accounts and your credit file.
Sources
Every figure on this page comes from the lender's or scheme's own published page, read on 1 November 2026. Panel rate ranges come from our partner's lender-panel catalogue, checked 1 September 2026. We do not use comparison sites as sources.