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Medium to long-term business loans

Find a loan with our partner FUNDING XCHANGE

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Available to business trading for a minimum of 18 months and with a turnover of at least £80,000. 

What are medium to long-term business loans?

A medium to long-term business loan offers an affordable way to borrow funds to help you build your business. With a loan you can spread the repayments over a term that suits you and your business needs.  

Business loans may be suitable if you’re running a start-up and need capital, you want to invest in new equipment, or you need a cash injection to improve cashflow. 

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How do business loans work?

Business loans work in a similar way to other types of loan where you borrow funds upfront and pay them back over time with interest 

  • Choose your loan

    Compare available deals to get the lowest rates and most suitable terms for your business. 

  • Make an application

    Once happy with your choice, you can apply online to your chosen provider in just a few minutes. 

  • Pay off the loan

    Once approved the funds will be released to you. You then start monthly repayments including the agreed rate of interest. 

What are the pros and cons of a medium to long term business loan?

A medium to long term business loan has several advantages over short-term borrowing. But there are some pitfalls to consider: 

  • Tick

    Advantages

    • Gives you the financial flexibility to invest in your business  

    • Interest rates on long term loans could be lower than short term loans 

    • Monthly instalments can be smaller than with short-term loans  



  • Cross

    Disadvantages

    • You’ll usually end up paying more in interest overall versus a short term loan 

    • It could be more difficult to be approved for a long term loan 

    • Some long term loans are secured against high-value assets such as property or stock 



How can I improve my chances of being accepted for a business loan?

There are a few steps you can take to improve your chances of being accepted for a business loan: 

  • Protect business credit rating

    Make sure your business credit rating is up to scratch by paying invoices and filing accounts on time, and keeping customers, suppliers, and directories up to date.  


  • Check eligibility

    When comparing loans, make sure you’re eligible before you apply by checking the lender’s requirements first. 


  • Sort the paperwork

    Have all the required documents to hand before you apply, including your business and personal tax returns, bank statements, financial statements, and legal documents. 

What are the alternatives to a long term business loan?

If you don’t want to take out a long term business loan, there are a number of other ways to borrow funds to support your business. Popular alternatives include:  

  • 1

    Business account overdraft

    Can be useful if you want to borrow money over a short period or in an emergency. Check interest rates carefully though as they can be high. 




  • 2

    Credit card

    You can often borrow more with a business credit card than a personal credit card as it will be based on your business income. You may be able to get cashback or rewards. 

  • 3

    Invoice financing

    Often involves a bank buying up your unpaid invoices or lending you money against the value of the accounts receivable. This works as a cash advance. 

How to compare business loans with MoneySuperMarket

Comparing business loans through MoneySuperMarket and our partner FUNDING XCHANGE is straightforward: 

  • Tell us what you're looking for

    We’ll ask a few simple questions about how much you want to borrow, your business, and what the money will be used for. 

  • Compare deals

    We’ll show you a list of potential deals including the interest rate and how much your monthly repayments might be. 

  • Apply in minutes

    Once happy with your choice, you can click through to apply quickly and easily online. Then wait for your funds to arrive. 

Available to business trading for a minimum of 18 months and with a turnover of at least £80,000. 

The term on your business loan will vary depending on the lender and the loan deal you choose. But long-term business loans could range anywhere from around five years to 30 years. A longer term can bring the cost of your loan down – but remember you’ll pay more interest overall. It’s important to select the loan deal that best suits the needs of your business.

You can choose either an unsecured or secured business loan. With a secured loan you will need to offer security to the lender. This can usually be in the form of business assets, such as property or equipment. Secured loans are less risky to the lender so you should be able to get a lower interest rate. But your assets are at risk of repossession if you can’t keep up with your loan repayments.

It may be possible to get a loan even if your business has not been operating for very long. But you’ll usually be viewed as more risky by the lender. For this reason you should expect interest rates to be higher and you may not be able to borrow as much.

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