Secured Business Loans UK 2025: Complete Guide
Use property or assets as security to access £10k-£5m at 4-12% APR. Lower rates, higher amounts, but your property is at risk for your business growth.
What Can You Use as Security?
Commercial property
Business premises you own
Residential property
Your home (second charge possible)
Business assets
Equipment, vehicles (asset finance)
Property portfolio
Multiple properties
Land
Development or agricultural land
Loan-to-Value (LTV) Limits
How much you can borrow based on property value:
| Security Type | Max LTV | £300k Property |
|---|---|---|
Commercial property (owner-occupied) | 70% | £210,000 |
Residential property (your home) | 60-70% | £180,000-£210,000 |
Second charge (existing mortgage) | 80% combined | Depends on equity |
Interest Rates by Security Type
Commercial mortgage (owner-occupied)
4-7% APR
LOWEST RATESCommercial mortgage (investment property)
5-9% APR
Second charge on home
6-12% APR
Bridging loan (short-term)
0.5-1.5% monthly (6-18% APR equivalent)
Secured vs Unsecured: Cost Comparison
£100,000 Over 5 Years
Secured
CHEAPER6% APR
£1,933/month
£15,980 interest
Unsecured
15% APR
£2,379/month
£42,740 interest
Savings with secured: £26,760 (63% less interest)
Risks of Secured Loans
Critical Risks
Only use secured loans for investments with clear, predictable ROI. Never borrow more than you can afford from business cash flow alone.
When Secured Loans Make Sense
Good uses:
Bad uses:
Application Process
Property valuation: Surveyor visit (£300-£1,000)
Legal work: Solicitor fees (£500-£2,000)
Credit checks: Business and personal
Financial review: 2-3 years accounts
Offer: 3-6 weeks typical
Completion: 1-2 weeks after offer
Total timeline: 4-8 weeks (vs 48 hours - 2 weeks for unsecured)
Conclusion
Secured loans offer lower rates (4-12% APR vs 8-35% unsecured) and higher amounts (up to £5m), but put your property at risk.
Choose secured if:
You own property, need large amounts (£100k+), want lowest rates, have clear repayment plan from business cash flow.
Choose unsecured if:
Do not own property, need under £100k, want fast approval, or are not confident about repayment.
Compare Secured & Unsecured Options
We will calculate whether secured or unsecured saves you more money
Based on your needs, property equity, and risk tolerance
Compare Loan OptionsFrequently Asked Questions
What can I use as security for a secured business loan?+
You can use: Commercial property (business premises you own), residential property (your home, second charge possible), business assets (equipment, vehicles for asset finance), property portfolio (multiple properties), land (development or agricultural land).
What are the loan-to-value (LTV) limits?+
LTV limits vary by security type: Commercial property (owner-occupied) - 70% LTV (£210k on £300k property), residential property (your home) - 60-70% LTV (£180k-£210k on £300k property), second charge (existing mortgage) - 80% combined LTV (depends on equity).
What are the risks of secured loans?+
Critical risks: Property repossession (lender can force sale if you default), negative equity risk (if property value falls, you may owe more than it is worth), lengthy legal process (if things go wrong, can take 12-18 months to resolve), personal guarantee usually still required (directors liable beyond property value).