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The cost of a small business loan depends on several factors, such as the loan amount, interest rate, repayment term, and whether the loan is secured or unsecured.

Interest rates can vary based on your credit history, business performance, and the lender’s criteria. Some loans also come with additional fees, such as arrangement fees or early repayment charges.

Secured loans typically offer lower rates, while unsecured loans may cost more due to higher risk. At Aurora Capital, we help you find the most competitive rates and terms to ensure affordable financing that suits your needs.

The time it takes to get a small business loan depends on the type of finance and the lender’s approval process.

Unsecured loans can often be approved within 24–48 hours, while secured loans may take longer due to asset valuation and legal checks.

Invoice finance and merchant cash advances can also be arranged quickly, sometimes within a day. Providing complete documentation and meeting lender requirements can speed up the process.

A small business loan is a finance product designed to help small to medium-sized businesses run and grow.

Several financing options are available to small businesses, and the right one for you will depend on your needs and financial situation.

Secured and unsecured loans can both support business growth, but it’s essential to understand the terms of each and how they could affect your finances.Here are a few things to consider when choosing the right business loan:

1. Are you willing to offer a UK property as security?

This is a key factor when deciding which loan suits you and your business best. If you’re happy to secure the loan against a UK property, a secured loan may offer lower rates due to the reduced risk for the lender.However, an unsecured loan may be a better option if you’re uncomfortable putting your property at risk or don’t own a suitable property.

2. How quickly do you require the funds?

Timing can be a critical factor when choosing between secured and unsecured finance. If you need fast access to funding, an unsecured loan may be a better option. The application is typically streamlined, and in some cases, you can receive funds within 48 hours of applying.

Secured loans, on the other hand, can take much longer to complete. Due to potential legal checks, property valuations, and additional paperwork, the process can take up to eight weeks.

3. Is flexibility or cost more important?

Although secured business loans are typically cheaper than unsecured ones, they usually have much less flexibility. Unsecured business loans allow you to settle early without paying a penalty and make overpayments towards your loan to reduce monthly commitments.

A secured loan typically has lock-in periods and early settlement fees, so it is worth opting for unsecured finance if you want the flexibility to repay early.

4. How much do you need to borrow?

Consider how much your business can borrow. If you're looking to borrow a larger amount, a secured loan may be a better option. Lenders are generally willing to offer higher limits when the loan is backed by property.

Because of the increased risk, unsecured loans are typically capped at lower amounts. So, if you only need a smaller loan or don’t have security to offer, an unsecured option may be more suitable.

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These loans tend to be unsecured, but it is possible to use a secured loan to boost your working capital. Unsecured options don’t require collateral but may come with higher interest rates.

Secured loans typically offer lower interest rates but require you to back the loan with business assets. The right option depends on your circumstances and risk appetite.

You should be able to repay your secured loan before the end of the term; however, you will probably need to pay early repayment charges.

When you apply, check the terms and conditions to see what fees you might face. Some lenders don’t charge fees for repaying the loan early, but most will charge a percentage of the outstanding balance or interest.

They can be easier to get because lenders are often more receptive to secured loans for business, which offer more security for repayment.

Also, lenders may offer more funds if you secure a residential rather than a commercial property.

oIf you don’t have an asset to use as security or don’t want to put any of your property at risk, there are several other business finance options you could consider:

• Unsecured business loans: This allows you to borrow without providing an asset as collateral, but they can be more expensive and have more stringent eligibility criteria.
• Bridging loans: A business bridging loan can help bridge the gap between a big purchase and incoming cash. It’s a type of secured loan but is designed to be short-term.
• Asset finance: If you want to buy new assets like equipment or vehicles, this type of borrowing allows you to spread the cost over time.
• Revolving credit line: This allows you to access a line of credit up to a set limit until the end of the agreement. It is designed to help alleviate minor cash flow issues.  
• Invoice finance: This is a short-term credit solution that allows you to release money from your unpaid invoices.
• Merchant cash advance: This is a way to borrow against future card sales. You repay a fixed percentage of your card transactions until the loan is repaid.
• Peer-to-peer lending: A peer-to-peer business loan is a way of borrowing directly from investors, usually via an online platform.

The right cash flow loan depends on what you need the money for, how quickly you need it, and what your business can afford to repay.

If you’re covering a temporary gap (like wages, bills, or supplier costs), a loan with a short term may make sense. If you’re funding something more significant, spreading repayments over a longer period can keep monthly costs manageable.

Also consider whether you need fixed repayments or more flexibility if your income changes month to month. If you’re unsure, start by considering what you need the loan for, the required amount, and your recent trading performance to find the right fit.

Cash flow finance refers to funding solutions that help businesses manage the gap between outgoing expenses and incoming revenue. It’s designed to keep operations running smoothly, whether you’re paying staff, purchasing stock, or investing in growth.

Even if your business is profitable, timing issues or delayed payments can create cash flow issues. A cash flow loan can give you the flexibility to act when needed, without being held back by gaps in working capital.

For example, if you invoice clients but only get paid once a project is complete, you may still need to cover the upfront cost of materials, equipment, or labour. Cash flow finance helps bridge that gap, allowing you to complete the work and repay the loan once the funds come in.