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Compare secured vs. unsecured business loans

Find out if a secured or unsecured business loan is better suited to your company's needs

If you’ve decided to apply for financing for your business, finding the right type of loan is an important next step. There’s a range of financing options available, but 2 of the most common business loan types are secured and unsecured loans. Read further to see how these 2 loans compare and which is best for your business.

What is the difference between secured and unsecured business loans?

The key difference between secured and unsecured business loans is the guarantee that is required — secured business loans require you to have assets to act as a form of security for your loan, whether they be business or personal. Unsecured business loans do not.

Secured business loans are typically offered by banks and can help a business access larger amounts. This is because lenders are taking on less of a risk if they know they can recoup their losses by your asset should the loan not be repaid. Unsecured business loans tend to come with lower loan amounts and higher rates as the loan is more of a risk.

Secured and unsecured business loans you can compare

ProviderUnsecured Loans Offered?Secured Loans Offered?Collateral RequiredOffer Details
OnDeck Business LoanRed Cross IconGreen checkmak IconA general lien is placed on business assets until the loan has been paid in full. A personal guarantee is also required from the business owner, but there is no lien placed on his or her personal assets.To be eligible, you must have been in business for at least 6 months with a minimum monthly revenue of $10,000.


OnDeck offers fast and simple financing. Apply in less than 10 minutes with your basic business information and see your loan offers without hurting your credit score. Get approved within 1 business day, and choose your term, amount and payback schedule once approved.
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Lending Loop Business LoanGreen checkmak IconRed Cross IconNoneLending Loop offers personalized loans up to $500,000 for small business owners who have been business for at least 1 year and can show a minimum of $100,000 annual revenue.
SharpShooter Funding Business LoanGreen checkmak IconRed Cross IconNoneTo be eligible, you must have been in business for at least 100 days with a minimum of $10,000 in monthly deposits.


SharpShooter provides capital to small businesses that are underserved by banks and credit unions. It measures overall business health and potential rather than focusing strictly on traditional metrics. Fill out a simple application and get pre-approved in minutes. Receive your funds within 24 hours.
Go to SharpShooter Funding's site

What is a personal guarantee?

A personal guarantee is a legally bound promise that the borrower will repay the loan with personal funds if the business fails. Keep in mind most business lenders require a personal guarantee to protect them against major losses if you default.

You may also often see a general lien requirement. A general lien is a lender’s right to keep your business assets in the event you’re unable to repay the loan.

What is considered a valuable asset for security?

When you’re borrowing against your assets, your loan is secured by the residual value that your assets represent. If you’re unable to repay the loan, the lender may seize your assets to cover the outstanding amount. Any of the following could be used as security:

  • Personal or commercial real estate
  • Vehicles
  • Business equipment
  • Investment accounts

You can also borrow against the valuation of your business as a whole.

25+ types of collateral you can use to secure different types loans

Is an unsecured or secured loan best for my business?

A secured business loan may be a good option for you if:
  • You’re looking to borrow a large amount of money over $1 million.
  • You have several assets you can secure the loan against.
  • You are in a position to make repayments over a long period of time.

You can usually find secured business loans from banks and lenders that offer SBA loans, but some alternative business lenders also offer secured loan options as well.

You may want to consider an unsecured business loan if:

  • You have a small- to medium-sized business with few or no valuable assets.
  • Your business is established and has growing monthly revenue.
  • You need a quick cash injection.
  • You can repay the loan over a period of 1 to 5 years.

Many lenders offer unsecured business loans, though you’ll likely need to meet stricter eligibility requirements because the lender is taking on more risks. As a minimum, you’ll generally need to be in business for at least a year and have monthly revenue of at least $10,000.

Compare top business loan providers

Name Product Interest Rate Loan Amount Loan Term Minimum Revenue Minimum Time in Business Loans Offered
SharpShooter Funding Business Loan
Prime pricing from 9.00%
$500 - $250,000
6 - 120 months
$10,000 /month
100 days
Unsecured Term, Merchant Cash Advance, Invoice Factoring
To be eligible, you must have been in business for at least 100 days with a minimum of $10,000 in monthly deposits.

SharpShooter provides capital to small businesses that are underserved by banks and credit unions. It measures overall business health and potential rather than focusing strictly on traditional metrics. Fill out a simple application and get pre-approved in minutes. Receive your funds within 24 hours.
Swoop Funding Business Loan
4.00% - 25.00%
$1,000 - $5,000,000
3 - 60 months
$10,000 /month
24 months
Term, MCA, LOC & more
To be eligible, you must have been in business for at least 24 months and have a minimum of $100,000 in annual revenue.

Swoop partners with banks and alternative lenders to match your business with the right funding options. Register for free and browse your offers without affecting your credit score.
OnDeck Business Loan
8.00% – 29.00%
$5,000 - $300,000
6 - 18 months
$10,000 /month
6 months
Secured Term, Line of Credit, Merchant Cash Advance
To be eligible, you must have been in business for at least 6 months with a minimum monthly revenue of $10,000.

OnDeck offers fast and simple financing. Apply in less than 10 minutes with your basic business information and see your loan offers without hurting your credit score. Get approved within 1 business day, and choose your term, amount and payback schedule once approved.
Loans Canada Business Loan
Prime Pricing from 9.00%
$2,000 - $350,000
3 - 60 months
$4,166 /month
100 days
Unsecured Term
To be eligible, you must have been in business for at least 100 days, have a credit score of 410+ and show a minimum of $4,166 in monthly deposits ($50,000/year).

Loans Canada connects Canadian small business owners to lenders offering financing up to $350,000. Complete one simple online application and get matched with your loan options.
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Bottom line

There isn’t one right loan solution for all businesses. By comparing your options and weighing up the pros and cons of each, you can find what’s right for your business.

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