PROFITTHEORY

Secured business loans

Secured business loans: how collateral changes the deal

A secured loan is backed by collateral — real estate, equipment, receivables, inventory or other assets. Collateral lowers the lender's risk, which can mean better terms, but the lender can claim the asset if the loan isn't repaid.

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Estimates only. Results vary. No guarantee of approval, rates or savings.

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Common collateral

Lenders discount collateral value to allow for selling costs.

  • Commercial real estate
  • Equipment and vehicles
  • Accounts receivable
  • Inventory
  • Cash or investment accounts

Liens and guarantees

Many lenders file a blanket lien on business assets and require personal guarantees. Read what's pledged, because it can limit future borrowing.

Run the numbers

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$
% APR

Use a rate you were quoted, or test a range. Not a quote.

years

10 years / 120 months

% of loan

Estimated monthly payment

$3,234.94

Total interest

$138,193

Total repaid

$388,193

Fixed-rate, fully amortizing estimate. Excludes variable-rate changes, prepayment terms, guarantee fees and closing costs unless entered. Not an offer or approval.

Talk to a financing specialistOptional. Your result stays on this page.

Estimates only. Results vary. No guarantee of approval, rates or savings.

Talk with a financing specialist

Common questions

Are secured loans cheaper?

Often, because the lender takes less risk — but cost depends on the lender, the asset and your file.

What's a blanket lien?

A lien on all business assets, common with many business loans.

Can I use personal assets?

Some lenders accept them, which puts those assets at risk. Consider carefully.