UNSECURED LOAN TYPES

Below are your informational guide to all different types of Unsecured Business Loans.

Explore our guide to various types of Unsecured Business Loans. Whether you’re considering uncollateral-based funding or seeking insights into fast funding solutions, we’ve got you covered. Understanding business loan interest rates is crucial for making informed financial decisions. At Liberty, we believe in transparency, providing clarity on interest rates to help you set realistic expectations. Rates shown on here is for informational purposes which compares to the current lending marketplace. You will achieve the same range no matter where you go.

Cash Flow Loan	Business Credit Card	Line of Credit	Term Loan	Merchant Cash Advance
Credit Score 500+	Credit Score 680+	Credit Score 700+	Credit Score 650+	Credit Score 500+
Time in Business 3 months+	Time in Business Any	Time in Business 2 years+	Time in Business 12 months+	Time in Business 3 months+
Monthly Revenue $4,000+	Monthly Revenue Any	Monthly Revenue $5,000+	Monthly Revenue $20,000+	Monthly Revenue $4,000+
Loan Amount $1k – $350k	Loan Amount $5k – $150k	Loan Amount $2k – $150k	Loan Amount $10k – $750k	Loan Amount $5k – $2MM
1.06 – 1.7	0% – 36%	8% – 55%	7% – 54%	18% – 140%
Benefits: Perfect credit not required.	Benefits: 0% intro APR’s, Spending Rewards. Points Rewards.	Benefits: Only pay interest on funds drawn, Credit is available when you need it, It is suitable for the majority of business needs.	Benefits: Loans are approved quickly, No collateral may be needed, Little paperwork, Early Payoff Discount.	Benefits: Short term to funding, Not for long term solution. It’s a stop gap. Emergency. Not to live off. No collateral required.
Drawbacks: Higher cost, Automatic payment.	Drawbacks: Variable rate, Possible annual fee. Appears on personal credit	Drawbacks: Don’t offer high approval and funding. Higher interest rates. Low approval rate. Not for low credit score, There is a personal guarantee.	Drawbacks: Credit window is a lot loose company to a line of credit. Shorter repayment term than bank loans.	Drawbacks: Higher cost depending on credit qualifications, revenue and sales history required.
Apply Now	Apply Now	Apply Now	Apply Now	Apply Now
1 year tax return	Typically no docs. Honor system. No income verification	1-2 years business tax returns	1 year tax return	4 months bank statements.
4 months bank statements		4 months bank statements	3-6 months business bank statements	4 months credit card processing statements
4 months credit card processing statements.		P&L and BS	4 months credit card processing statement	1-2 yrs tax returns.
Proof of Ownership		Proof of Ownership	Year-to-date Financials (P&L and BS)	Proof of Ownership

What is Unsecured Business Loan?

Unsecured Business Loans:
- Definition: Unsecured business loans do not require collateral. They are issued based on the creditworthiness of the borrower and their ability to repay the loan.
- Key Points:
  - Collateral: Not required; the loan approval is based on the borrower’s creditworthiness.
  - Risk: Higher risk for lenders because they have no specific asset to seize if the borrower defaults.
  - Interest Rates: Generally higher compared to secured loans due to the increased risk for the lender.
  - Eligibility: Typically requires a stronger credit profile and financial history.
  - Examples: Credit cards, personal loans (if used for business purposes), and some lines of credit can be unsecured.

Comparison:

Risk: Secured loans are less risky for lenders because they have collateral as security, whereas unsecured loans are riskier because there’s no collateral backing.
Interest Rates: Secured loans generally have lower interest rates due to the collateral, while unsecured loans tend to have higher rates.
Qualification: Secured loans can be easier to qualify for if the borrower has valuable assets to pledge, whereas unsecured loans require a stronger credit profile.
Flexibility: Unsecured loans may offer more flexibility in terms of usage and may not require detailed asset valuation or appraisal.

Choosing between a secured and unsecured business loan depends on factors like the borrower’s creditworthiness, the amount needed, and the willingness to pledge collateral.

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From application to funding, your guide to unsecured business loans.

As a business owner, navigating the landscape of small business funding can be time-consuming. That’s why Liberty Capital has created a comprehensive guide for small business owners like you. This guide is designed to help you explore and understand all types of business funding options available when you apply with us.As a business owner, small business funding landscape can be time consuming, that’s why Liberty Capital has put out a guide for small business owners, like you, to use to navigate all types of business funding available when you apply with us.

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