Whether you’re growing your Liverpool business, need working capital, want to purchase equipment, or require funds for a specific opportunity, getting the right business loan is crucial. Based in Liverpool city centre with over 30 years of combined experience, we specialise in arranging business finance for companies across Merseyside.

We work with over 60 business lenders – from high street banks to alternative finance providers – to find you the right funding at the best terms. Our team understands Liverpool’s business landscape and knows which lenders support which sectors.

From £10,000 to £5 million, from startups to established enterprises, we can help.

Free business loan consultation: 0151 314 8757

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What is a Business Loan?

A business loan is money borrowed by your company to fund business activities, repaid over an agreed period with interest. Unlike personal loans, business loans are designed specifically for commercial purposes with terms, amounts, and structures suited to business needs.

Key features:

• Loan amounts: £10,000 to £5 million+
• Loan terms: 1 to 25 years (depending on purpose)
• Interest rates: From 5% to 15%+ APR (depending on risk factors)
• Security: Can be secured (against assets) or unsecured
• Repayment: Usually fixed monthly payments
• Application: Based on business strength, not personal income

Used for:

• Business expansion
• Working capital
• Equipment and vehicles
• Stock and inventory
• Property refurbishment
• Marketing campaigns
• Hiring staff
• Technology upgrades
• Debt consolidation
• Acquisition of other businesses
• Cash flow management
• Contract fulfillment
• Seasonal demand

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Types of Business Loans We Arrange

Unsecured Business Loans

Loans not secured against specific assets:

Ideal for:

• Businesses without significant assets
• Funding needed quickly (1-7 days possible)
• Amounts up to £500,000
• Working capital and cash flow
• Short to medium-term needs (1-5 years)

Advantages:

• Fast approval and funding
• No assets at risk
• Simple application process
• Flexible use of funds
• No security valuation needed

Considerations:

• Higher interest rates (7-15%+ typical)
• Personal guarantees usually required
• Lower maximum amounts than secured loans
• Need strong business performance
• Shorter repayment terms generally

Liverpool business example: Digital marketing agency in Baltic Triangle needed £75,000 for office expansion and new staff. No property to use as security. We arranged unsecured business loan at 9.8% over 4 years. Funded within 5 days, monthly payment £1,900.

Secured Business Loans

Loans secured against business or personal assets:

Security can include:

• Commercial property you own
• Residential property (business owner’s home)
• Equipment and machinery
• Vehicles
• Stock and inventory
• Debtors (outstanding invoices)

Advantages:

• Lower interest rates (5-10% typical)
• Higher loan amounts (up to £5m+)
• Longer repayment terms (up to 25 years)
• More lenders available
• Better terms for larger amounts

Considerations:

• Assets at risk if you default
• Longer application process (valuation needed)
• More documentation required
• Personal assets may be required
• More expensive if you repay early (exit fees)

Liverpool business example: Manufacturing company in Speke needed £450,000 to purchase new machinery and expand production. Secured against their factory building (valued at £800,000). 6.4% rate over 10 years, monthly payment £5,100.

Start-Up Business Loans

Funding for new Liverpool businesses:

Criteria vary but typically need:

• Detailed business plan
• Financial projections
• Relevant industry experience
• Some personal investment/deposit
• Good personal credit score

Available amounts: £5,000 to £150,000 typically Government schemes: Start Up Loans (government-backed, up to £25k) Alternative options: Peer-to-peer lending, crowdfunding, angel investors

Liverpool resources:

• Liverpool City Region Growth Hub
• Liverpool Chamber of Commerce
• Baltic Creative CIC (for creative businesses)
• Local Enterprise Partnerships

Liverpool start-up example: Independent coffee shop opening in Woolton Village. Owner had hospitality experience but no trading history. We secured £45,000 Start Up Loan at 6% fixed over 5 years (government-backed scheme). Used for equipment, initial stock, and working capital.

Working Capital Loans

Short-term finance for day-to-day business operations:

Used for:

• Paying suppliers
• Covering payroll
• Managing cash flow gaps
• Buying stock
• Bridging timing differences between payments in and out

Terms: Usually 3-18 months Amounts: £5,000 to £500,000 Speed: Often available within 24-48 hours

Types of working capital finance:

• Revolving credit facilities: Borrow, repay, borrow again as needed
• Invoice finance: Borrow against outstanding invoices (see separate section)
• Merchant cash advances: Based on card transaction volumes
• Short-term loans: Fixed amount, fixed term

Liverpool business example: Construction company in Knowsley won £180,000 contract but needed materials upfront. Customer paying on 60-day terms. We arranged £60,000 working capital loan over 6 months at 8.5%. Enabled them to fulfill contract, repaid from customer payment.

Equipment Finance & Leasing

Funding specifically for business equipment:

Can finance:

• Vehicles (cars, vans, trucks, specialist vehicles)
• Manufacturing machinery and equipment
• Construction equipment and plant
• IT systems and computers
• Office furniture and equipment
• Catering and restaurant equipment
• Medical and dental equipment
• Printing and packaging machinery
• Agricultural machinery
• Warehouse equipment
• Retail fixtures and fittings
• Almost any business equipment!

Structures:

• Hire Purchase: Own equipment at end of term
• Finance Lease: Use equipment, return at end (or buy for residual)
• Operating Lease: Essentially rental, no ownership option
• Equipment Loan: Borrow money to buy equipment outright

Advantages:

• Preserve working capital
• Fixed monthly costs
• Equipment itself often serves as security
• Tax benefits (equipment can be capital allowance)
• Keep equipment up to date

Liverpool business example: Electrical contractor in Liverpool needed 3 new vans (£85,000 total). Rather than cash purchase, we arranged hire purchase over 5 years at 6.2%. Monthly payment £1,640. Vans serve as security, business preserves £85k working capital for other opportunities.

Commercial Property Purchase Loans

Different from commercial mortgages – these are business loans secured against property:

When used instead of commercial mortgage:

• Faster completion needed
• Property condition issues
• Planning changes anticipated
• Short-term hold (intend to sell within 5 years)
• Want flexibility to repay early without penalties

Terms: 1-10 years typically Rates: 6-12% (higher than commercial mortgages but more flexible) LTV: Up to 70%

Liverpool business example: Property company wanted to purchase office building in L3 to refurbish and flip. Commercial mortgage was too slow (10-week process). We arranged commercial property loan at 8.4% over 3 years. Completed in 12 days. Refurbished and sold after 18 months for profit.

Business Acquisition Loans

Funding to buy another business:

Used to purchase:

• Competitor businesses
• Complementary businesses
• Franchises
• Client lists and goodwill
• Shares in companies
• Business assets

Lender assessment:

• Target business’s financial performance
• Purchase price vs valuation
• Your experience in the sector
• Integration plan
• How acquisition improves your business

Typical structure:

• 50-70% of purchase price funded
• Your cash funds the rest
• Secured against business assets or property
• 3-7 year terms common

Liverpool business example: Established accountancy firm (25 years trading) wanted to acquire smaller retiring accountant’s practice and client list. Purchase price £280,000. We arranged £180,000 acquisition loan at 7.2% over 5 years secured against their office building. Combined practice now turns over £1.1m annually.

Invoice Finance & Factoring

Borrowing against unpaid customer invoices:

Two main types:

1. Invoice Discounting

• You maintain client relationships
• Lender advances 80-90% of invoice value
• You collect payment as normal
• When customer pays, you repay advance plus fee
• Confidential (customers don’t know)

2. Factoring

• Lender manages your sales ledger
• Lender chases payment from customers
• 70-85% advance typically
• Customers aware of arrangement

Costs:

• Discount rate: 1-5% of invoice value
• Service fee: 0.5-3% of turnover
• Interest on outstanding advances

Ideal for:

• B2B businesses with 30-90 day payment terms
• Growing businesses needing working capital
• Businesses with lumpy cash flow
• Contract-based businesses

Liverpool business example: IT services company in Liverpool city centre had £240,000 in outstanding invoices, customers on 60-day terms. Growth opportunities but cash-strapped. We arranged invoice finance facility releasing 85% of invoice values (£204,000 immediate cash). Fee: 2% of invoice value. Transformed cash flow, enabling them to take on more work.

Revenue-Based Business Loans

Repayments vary with business revenue:

How it works:

• Fixed percentage of daily/weekly/monthly revenue
• When revenue high, pay more
• When revenue low, pay less
• Total amount and factor rate agreed upfront

Ideal for:

• Seasonal businesses
• Retail businesses with variable turnover
• Hospitality businesses
• Businesses with unpredictable income

Liverpool business example: Liverpool restaurant with strong summer trade, quieter winters. Needed £60,000 for kitchen refurbishment. Traditional loan’s fixed payments would strain cash flow in winter. We arranged revenue-based loan – they pay 12% of weekly card takings until loan plus factor repaid. Summer weeks they pay £1,800, winter weeks £600. Perfect for their cycle.

Business Overdrafts

Flexible credit facility attached to business bank account:

Features:

• Borrow only what you need, when you need it
• Pay interest only on amount overdrawn
• No set repayment schedule (as long as you’re within limit)
• Instant access to funds
• Can be paid off and reused

Limits: £1,000 to £250,000 typically Interest: 8-20% typically (higher than loans) Fees: Often arrangement fee and annual renewal fee

Best for:

• Short-term cash flow gaps
• Seasonal fluctuations
• Unexpected expenses
• Safety net alongside other funding

Not ideal for:

• Long-term borrowing (expensive)
• Large amounts (loans are cheaper)
• Permanent working capital need

Liverpool business example: Wholesale business in Garston with seasonal demand. Needs extra stock in summer, quiet in winter. £50,000 overdraft facility (£500 arrangement fee, 14% interest). Summer months they use full £50k (costs £580/month interest). Winter months they’re in credit. Average monthly interest cost over year: £290.

Asset Refinance

Releasing cash from assets you already own:

Assets you can refinance:

• Vehicles and machinery (must be owned, not financed)
• Property (sale and leaseback arrangements)
• Equipment
• Stock

How it works:

• Lender values your asset
• They advance typically 60-80% of value
• You continue using the asset
• Repay over agreed term

Different from selling:

• You keep using the asset
• Get cash injection without losing equipment
• Can be faster than selling
• But you’re taking on debt

Liverpool business example: Manufacturing business owned £180,000 of machinery outright (bought with past profits). Needed £120,000 for expansion but didn’t want more debt on balance sheet. We arranged asset refinance against machinery – 70% advance (£126,000) over 5 years at 8.1%. They keep using machinery, got needed capital.

Merchant Cash Advances

Based on your card payment turnover:

How it works:

• Lender reviews your card transaction history
• They advance a lump sum (typically 80-150% of monthly card sales)
• You repay a percentage of daily card sales
• Automatic deductions from card processor
• Complete when agreed total repaid

Speed: Often 24-48 hours from application to funds Amounts: £5,000 to £500,000 Factor rate: 1.1 to 1.5 (you repay £11,000-£15,000 for every £10,000 borrowed)

Ideal for:

• Retail businesses with high card sales
• Restaurants and hospitality
• Urgent funding needs
• Businesses unable to get traditional loans

Expensive: Factor rates translate to high APRs (30-80%+)

Liverpool business example: Bold Street retailer needed £30,000 urgently for stock opportunity (supplier offered 40% discount for bulk order). Card turnover £15,000/week. We arranged merchant cash advance of £30,000, factor rate 1.3 (repay £39,000). They pay 15% of daily card sales. Extra stock sold with good margin, advance repaid in 4 months despite high factor rate, overall transaction profitable.

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How Much Can Your Business Borrow?

Unsecured Loan Amounts

Based primarily on:

• Annual turnover: Generally can borrow 10-25% of annual turnover
• Time trading: Minimum 6-12 months typically
• Profitability: Must be profitable or breaking even minimum
• Credit score: Business and personal credit checked

Examples:

• Turnover £200,000: Typically up to £30-50k unsecured
• Turnover £500,000: Typically up to £75-125k unsecured
• Turnover £1,000,000: Typically up to £150-250k unsecured

Secured Loan Amounts

Based on:

• Security value: Usually can borrow 60-75% of asset value
• Business strength: Still assessed but less critical
• Repayment capacity: Must demonstrate ability to repay

Examples:

• Business property worth £500,000: Up to £350,000 loan
• Equipment worth £100,000: Up to £70,000 loan
• Home worth £400,000: Up to £280,000 secured business loan

Affordability Assessment

Lenders check you can afford repayments:

Monthly repayment typically shouldn’t exceed:

• 10-15% of monthly revenue (for unsecured loans)
• 20-30% of monthly profit
• Must leave sufficient working capital

Example calculation:

• Monthly revenue: £50,000
• Monthly costs: £42,000
• Monthly profit: £8,000
• Maximum monthly loan payment: £7,500 (15% of revenue)
• At 8% over 5 years, supports loan of approximately £305,000
• But would leave only £500/month profit – too tight
• Realistically: £3,000 monthly payment more sustainable
• Supports loan of approximately £120,000

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Business Loan Interest Rates & Costs

Interest Rate Factors

Your rate depends on:

1. Loan Security

• Unsecured: 7-15%+
• Secured: 5-10%
• Government-backed: 4-8%

2. Business Age

• 5+ years: Best rates
• 2-5 years: Standard rates
• Under 2 years: Premium rates
• Start-up: Highest rates (if available)

3. Business Strength

• Strong profitability: Best rates
• Breaking even: Standard rates
• Losses (but strong plan): Premium rates

4. Credit Score

• Excellent (750+): Best rates
• Good (650-749): Standard rates
• Fair (550-649): Premium rates
• Poor (<550): Very limited options, high rates

5. Loan Amount

• Larger loans (£250k+): Better rates
• Medium loans (£50-250k): Standard rates
• Smaller loans (<£50k): May have higher rates

6. Loan Term

• Shorter term (1-3 years): Lower rates typically
• Medium term (3-7 years): Standard rates
• Longer term (7-25 years): Slightly higher rates

Typical APR Ranges (November 2025)

Unsecured business loans:

• Excellent profile: 7-10% APR
• Good profile: 10-15% APR
• Fair profile: 15-25% APR

Secured business loans:

• Excellent profile: 5-7% APR
• Good profile: 7-10% APR
• Fair profile: 10-15% APR

Start-up loans:

• Government-backed: 6% fixed
• Alternative lenders: 12-25% APR

Invoice finance:

• Discount rate: 1-5% per invoice
• Plus service fee: 0.5-3% of turnover
• Plus interest on advances: 3-10% on outstanding

Asset finance:

• 6-12% APR typically
• Depends on asset type and age

Arrangement Fees

• Many lenders: No arrangement fee for business loans
• Some lenders: 1-3% of loan amount
• Broker fees: Usually 1-2% (our fees confirmed upfront)

Early Repayment

• Some lenders: Early repayment allowed without penalty
• Others: Early repayment charges (typically 1-3 months interest)
• Always check: Before signing

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Business Loan Process & Timeline

Stage 1: Initial Consultation (Day 1)

Free discussion covering:

• What you need funding for
• How much you need
• Your business background
• Trading history and performance
• Assets available for security (if any)
• Timeline requirements

Outcome: We’ll tell you if funding is achievable, approximate terms, and which loan types suit your needs.

Duration: 20-40 minutes usually

Stage 2: Formal Application (Days 1-3)

Information needed:

• 2 years business accounts (or 12+ months bank statements if newer)
• 3-6 months business bank statements
• Business plan (if start-up or significant loan)
• Personal credit check permission
• ID and proof of address
• Details of what funding will be used for

We compile and submit to suitable lenders

Stage 3: Lender Decision (Days 3-10)

Lender reviews and may request:

• Additional documentation
• Clarification on specific points
• Evidence of deposit (if purchase)
• Quotes for equipment (if equipment loan)

Timeline:

• Unsecured loans: 1-5 days typically
• Secured loans: 7-14 days (valuation needed)
• Complex cases: 2-4 weeks

Stage 4: Valuation (If Secured)

If loan is secured against property:

• Lender instructs RICS valuer
• Valuation survey conducted
• Report submitted to lender
• Timeline: 5-10 days typically

Stage 5: Formal Offer (Days 7-14)

Lender issues offer detailing:

• Loan amount
• Interest rate and APR
• Term and monthly payment
• Any conditions
• Fees and charges

You review with our guidance

Stage 6: Legal Work (If Secured)

For secured loans:

• Solicitors required
• Legal charge prepared
• Security documents signed
• Timeline: 1-3 weeks

For unsecured loans:

• Usually just loan agreement to sign
• Timeline: 1-2 days

Stage 7: Funds Released

For unsecured loans:

• Often same day as signing
• Sometimes next working day
• Rarely more than 3 days

For secured loans:

• Once legal charge registered
• 1-3 days after signing completion

Total Timeline:

• Fast unsecured: 3-7 days
• Standard unsecured: 1-2 weeks
• Secured loans: 3-6 weeks
• Complex/large: 6-10 weeks

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Liverpool Business Sectors We Support

Hospitality & Leisure

Liverpool’s thriving tourism and student population supports strong hospitality sector:

We fund:

• Restaurants and cafes
• Bars and pubs
• Hotels and guest houses
• Event venues
• Leisure facilities
• Gyms and fitness studios

Recent example: Baltic Triangle bar needed £95,000 for expansion into adjacent unit. We arranged unsecured loan at 9.2% over 5 years. Revenue increased 65% post-expansion, loan comfortably serviced.

Retail

Independent retail thriving in Liverpool:

We fund:

• Independent shops
• Online retailers with inventory needs
• Franchises
• Market traders scaling up
• Pop-up to permanent transitions

Recent example: Bold Street clothing retailer wanted to open second location in Woolton. £60,000 secured loan (secured against residential property) at 7.8% over 7 years funded fit-out and initial stock.

Professional Services

Strong and growing sector in Liverpool:

We fund:

• Accountancy firms
• Legal practices
• Marketing agencies
• IT consultancies
• Recruitment agencies
• Business consultancies

Recent example: Marketing agency in Commercial District needed £125,000 for office expansion and 3 new senior hires. Unsecured loan at 8.6% over 5 years. New hires brought in £340k additional revenue in first year.

Construction & Trades

Always high demand in Liverpool:

We fund:

• Builders and contractors
• Electricians and plumbers
• Specialist trades
• Project-based businesses

Typical uses: Vehicles, equipment, working capital for materials, contract fulfillment

Recent example: Electrical contractor needed £45,000 for 3 vans and equipment to fulfill large contract. Hire purchase on vans (£35k) plus £10k working capital loan. Contract completed profitably, equipment now owned outright.

Manufacturing

Liverpool’s industrial heritage continues:

We fund:

• Food and beverage manufacturing
• Engineering and fabrication
• Packaging and printing
• Specialist manufacturing

Typical uses: Machinery, premises purchase, working capital, expansion

Recent example: Food manufacturer in Speke needed £380,000 for new production line to meet supermarket order. Secured loan at 6.8% over 10 years against factory building. Production line installed, contract fulfilled, business now turns over £2.8m annually.

Technology & Digital

Growing sector, particularly in Baltic Triangle:

We fund:

• Software development
• Digital marketing
• E-commerce businesses
• Tech startups (with trading history)
• Creative agencies

Typical uses: Staff recruitment, office space, equipment, marketing, development costs

Recent example: Software company needed £180,000 to hire development team ahead of major client project. Unsecured loan at 9.4% over 4 years. Project delivered successfully, new revenue stream established.

Healthcare & Wellbeing

Growing sector with aging population:

We fund:

• Dental practices
• Physiotherapy clinics
• Care homes
• Wellness centers
• Medical facilities

Typical uses: Equipment, premises, acquisition of other practices

Recent example: Dental practice wanted to acquire retiring dentist’s patient list and equipment (£220,000). We arranged acquisition loan at 7.2% over 7 years secured against principal dentist’s home. Patient list integrated, practice value increased significantly.

Transport & Logistics

Liverpool’s port drives strong logistics sector:

We fund:

• Haulage companies
• Courier services
• Logistics operators
• Vehicle fleet operators

Typical uses: Vehicle purchase, warehouse facilities, working capital

Recent example: Courier company needed 8 new vans (£160,000). We arranged asset finance over 5 years at 7.4%. Contract with major retailer required modern fleet – finance enabled them to secure contract.

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Why Choose Liverpool Commercial Finance for Business Loans?

Liverpool Based, Liverpool Focused

We’re not a national broker with a generic Liverpool page. We’re in Liverpool city centre, we understand Liverpool’s business landscape:

• Which sectors are thriving locally
• Liverpool business challenges and opportunities
• Local business support available
• Which lenders like Liverpool businesses
• Realistic business costs for Liverpool operations

This local knowledge helps us position applications effectively.

30+ Years Combined Business Finance Experience

Our team includes:

• Ex-bank business lending managers
• Business owners who’ve borrowed themselves
• Commercial finance specialists
• Industry-specific advisers

We understand business from multiple angles – not just the finance side.

60+ Business Lenders

High street banks: Barclays, NatWest, HSBC, Lloyds, Santander Challenger banks: Metro Bank, Starling, TideAlternative lenders: Iwoca, Funding Circle, Market Finance Asset finance specialists: Lombard, Aldermore, Close Brothers Invoice finance: Bibby, Skipton Business Finance, Lloyds Specialist lenders: For specific sectors or situations

Different lenders have different appetites:

• Some love hospitality, others avoid it
• Some prefer established businesses, others accept startups
• Some offer fast decisions, others want detail
• Some are flexible on credit issues, others strict

We know which lender suits your specific business.

No Upfront Fees

We only get paid when your loan completes. If we can’t help you, or if you decide not to proceed, you pay us nothing.

This aligns our interests with yours completely.

Fast Decisions

For straightforward cases:

• Initial feedback: Same day
• Formal terms from lender: 2-5 days
• Funds available: 1-2 weeks (unsecured)

For urgent situations, we’ll tell you immediately if fast funding is realistic.

Face-to-Face Service

Business loans are significant commitments. We meet clients:

• At our Liverpool city centre office
• At your business premises
• Over video call if preferred

Understanding your business properly requires conversation.

Honest Advice

If borrowing isn’t right for your situation, we’ll say so. Alternatives we might suggest:

• Wait and build stronger position
• Consider alternative funding (grants, equity investment)
• Restructure existing finance first
• Different type of finance than you requested

We’d rather give honest advice than facilitate unsuitable borrowing.

Business Planning Support

For start-ups or significant loans requiring business plans, we can:

• Guide you on what lenders want to see
• Review draft plans
• Suggest improvements
• Connect you with business planning resources

We want you to succeed, which means ensuring foundations are right.

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Frequently Asked Questions

Can start-ups get business loans?

Yes, but options are limited:

Government Start Up Loans: Up to £25,000 at 6% fixed, for businesses trading less than 2 years. Good option if eligible.

Alternative lenders: Some accept businesses trading 3-6 months, based on bank statements rather than accounts.

Secured loans: If you have property/assets, these are more accessible for start-ups.

Reality: Most lenders want 1-2 years trading minimum. First year is about proving the business works, then funding becomes much easier.

Liverpool start-up resources:

• Liverpool City Region Growth Hub
• New Enterprise Allowance (if claiming benefits)
• Prince’s Trust (if under 30)
• Local business mentoring schemes

How long does my business need to be trading?

Minimum trading periods:

• Unsecured loans: Typically 12 months
• Secured loans: 12 months ideal, sometimes 6 months accepted
• Invoice finance: 3-6 months possible
• Asset finance: Sometimes available immediately (asset is security)
• Government start-up loans: Available for pre-trading businesses with good plan

Better terms usually available after:

• 2 years trading (more lenders)
• 3 years trading (best rates and terms)

Can I get a business loan with bad credit?

Depends on severity and context:

Minor issues (old defaults, satisfied CCJs):

• Many alternative lenders will consider
• Rates will be higher (12-20% possible)
• Lower loan amounts available
• Secured loans more accessible than unsecured

Major issues (recent CCJs, bankruptcies, defaults):

• Very limited options
• Secured loans your best chance
• Need strong business performance to compensate
• Expect premium rates (15-25%+)

Current county court judgements:

• Must be satisfied first typically
• Some lenders will consolidate into business loan

Our approach: We know which lenders are flexible with credit issues and how to position applications to maximize approval chances.

Do I need to put up my home as security?

Not always:

• Unsecured business loans don’t require property security
• Many business loans are secured against business assets only
• Invoice finance secured against invoices
• Asset finance secured against the equipment itself

When home security is required:

• Larger secured business loans (£200k+)
• If business has insufficient assets
• For better rates on significant amounts
• Director’s personal guarantee situations

Our advice: We always explore options without home security first. If home security offers significantly better terms, we’ll explain pros and cons clearly so you can make an informed decision.

What if my business makes losses?

Current losses make lending very difficult:

• Most lenders need profitability or break-even minimum
• Exception: If you have strong assets for security
• Exception: If losses are temporary and explainable (e.g., heavy investment in growth)

Past losses but now profitable:

• Many lenders will consider if recent trend is positive
• Strong explanation in business plan helps
• Secured loans more accessible than unsecured

Reality: Lenders want confidence in repayment. Current profitability (even modest) is usually essential.

How much will it cost me to borrow?

Example calculations:

£50,000 over 5 years at 9% APR

• Monthly payment: £1,038
• Total repayment: £62,280
• Total interest: £12,280

£100,000 over 7 years at 7% APR

• Monthly payment: £1,470
• Total repayment: £123,480
• Total interest: £23,480

£250,000 over 10 years at 6% APR

• Monthly payment: £2,775
• Total repayment: £333,000
• Total interest: £83,000

Plus arrangement fees if applicable (0-3% typically)

Can I repay early?

Most business loans allow early repayment but check:

No penalties: Some lenders allow full or partial early repayment without charge

Early repayment charges: Others charge penalties (typically 1-3 months interest on amount repaid early)

Fixed rate period: Some loans have early repayment charges only during fixed rate period

Always check before borrowing: If you might refinance or sell the business, early repayment terms matter.

What’s the difference between a business loan and a commercial mortgage?

Business Loan:

• Shorter terms (1-10 years typically)
• Used for various business purposes
• Can be secured or unsecured
• Faster to arrange
• More flexible

Commercial Mortgage:

• Longer terms (15-30 years typical)
• Specifically for property purchase
• Always secured against property
• Slower to arrange (6-10 weeks)
• Lower interest rates
• Larger amounts available

When to use which: Property purchase for long-term ownership = commercial mortgage. Everything else = business loan. (Though overlap exists – we’ll advise best option for your situation.)

Will applying affect my credit score?

Soft search (initial): No impact on credit score, used for initial assessment

Hard search (application): Records on credit file for 12 months

• One application: Minimal impact
• Multiple applications short period: Can negatively impact score

Our approach: We do one soft search to check eligibility, then apply to the single most suitable lender rather than scattergun applications.

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Business Loan Case Studies

Case Study 1: Restaurant Expansion in Liverpool City Centre

Business: Independent restaurant, 4 years trading, strong reviews, loyal following

Situation: Opportunity to expand into adjacent unit, doubling capacity

Funding need: £110,000 for fit-out, equipment, initial stock, marketing

Solution: Unsecured business loan

• Amount: £110,000
• Term: 6 years
• Rate: 8.9% APR
• Monthly payment: £1,890

Outcome: Expansion increased revenue from £38k/month to £67k/month. Additional £29k monthly revenue easily covers £1,890 loan payment. Loan on track to be repaid early from increased profits.

Case Study 2: Manufacturing Equipment Purchase

Business: Packaging manufacturer in Speke, 12 years trading, consistent profitability

Situation: New machine needed to fulfill major supermarket contract

Funding need: £285,000 for specialized packaging equipment

Solution: Asset finance secured against the equipment

• Amount: £285,000
• Term: 7 years
• Rate: 7.2% APR
• Monthly payment: £4,150

Outcome: Machine installed, supermarket contract secured worth £480k annually. Machine paid for itself within 18 months. Company now has long-term relationship with major customer.

Case Study 3: Working Capital for Growth

Business: Digital marketing agency in Baltic Triangle, 3 years trading, rapid growth

Situation: Winning more clients than they could service with existing team. Needed to hire 4 staff but 3-month cash flow gap (new hires’ salaries vs clients paying invoices)

Funding need: £75,000 working capital to cover salaries while building up

Solution: Unsecured business loan

• Amount: £75,000
• Term: 4 years
• Rate: 9.6% APR
• Monthly payment: £1,900

Outcome: 4 new hires brought in £340k additional annual revenue. After 18 months, business cash flow strong enough that they repaid loan early (no penalties). Business now 14 staff, turnover £1.2m.

Case Study 4: Business Acquisition

Business: Plumbing business, 8 years trading, strong local reputation

Situation: Competitor retiring, offered business with van fleet and customer list for £195,000

Funding need: £195,000 to acquire business

Solution: Secured business loan against business owner’s home

• Amount: £195,000
• Term: 10 years
• Rate: 6.4% APR
• Monthly payment: £2,200

Outcome: Combined businesses now turn over £890k annually (previously £440k). Acquired 3 qualified plumbers and 8 vans. Owner’s salary increased from £62k to £95k. Loan comfortably serviced from increased profits.

Case Study 5: Start-Up Coffee Shop

Business: New independent coffee shop in Woolton Village

Situation: Experienced barista wanted own shop. Found perfect location, 5-year lease available.

Funding need: £48,000 for equipment, fit-out, initial stock, 3 months working capital

Solution: Government-backed Start Up Loan

• Amount: £25,000 at 6% fixed over 5 years
• Plus personal savings: £15,000
• Plus equipment finance: £8,000 over 3 years at 8.5%
• Total funding: £48,000

Outcome: Shop opened successfully, strong local following developed. Revenue month 3: £18k. By month 12: £28k monthly. Now profitable and considering second location. Start-up loan payments (£483/month) easily covered by profits.

Case Study 6: IT Contractor Company Cash Flow

Business: IT contractor supplying staff to large corporations, 5 years trading

Situation: Customers paying on 60-day terms, contractor salaries due monthly. Growth constrained by cash flow.

Funding need: Working capital solution for cash flow timing difference

Solution: Invoice finance facility

• 85% advance on invoices raised
• Discount rate: 2.5% per invoice
• Service fee: 1% of turnover
• Interest on advances: 6% APR

Outcome: Company immediately had access to £180k working capital (85% of £212k outstanding invoices). Enabled them to take on more contracts. Revenue grew from £2.4m to £3.8m annually. Invoice finance costs (approximately £5k monthly) more than covered by additional profit from growth.

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Liverpool Business Support & Resources

Local Business Organizations

Liverpool Chamber of Commerce

• Networking events
• Business support and advice
• Training and workshops
• Export support
• Website: liverpoolchamber.org.uk

Liverpool City Region Combined Authority

• Business support programs
• Grant funding opportunities
• Skills and training funding
• Website: liverpoolcityregion-ca.gov.uk

Liverpool City Region Growth Hub

• Free business advice
• Growth planning support
• Access to finance guidance
• Signposting to support services
• Website: growthhub.investliverpool.com

Baltic Creative CIC

• Support for creative and digital businesses
• Co-working spaces
• Networking and events
• Funding advice
• Website: balticcreative.com

Government Support Schemes

British Business Bank

• Start Up Loans (up to £25k at 6%)
• Recovery Loan Scheme
• Enterprise Finance Guarantee
• Future Fund
• Website: british-business-bank.co.uk

Innovate UK

• Innovation funding
• R&D grants
• Collaborative projects
• Smart grants
• Website: innovateuk.ukri.org

Liverpool City Council Business Grants

• Various schemes available
• Check website regularly for new programs
• Website: liverpool.gov.uk/business

Mentoring & Advice

Newable (formerly NBSL)

• Free business mentoring
• Start-up support
• Growth advice
• Website: newable.co.uk

Prince’s Trust

• Support for under 30s
• Start-up mentoring
• Low-interest loans
• Website: princes-trust.org.uk

PRIME

• Support for over 50s starting businesses
• Free advice and mentoring
• Website: primeinitiative.org.uk

Networking Organizations

Liverpool BNI Chapters

• Structured referral networking
• Weekly meetings
• Multiple chapters across Liverpool
• Website: bni.com

Liverpool Enterprise Network (LEN)

• Networking events
• Business connections
• Support and advice
• Website: len.org.uk

Liverpool Women in Business

• Support network for female entrepreneurs
• Networking events
• Mentoring
• Various organizations active in Liverpool

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Business Loan Checklist

Before You Apply

• Clear purpose for borrowing (what will funds be used for?)
• Realistic amount needed (not too much, not too little)
• Can afford monthly repayments (check cash flow carefully)
• Business accounts prepared (2 years if available)
• Business bank statements ready (3-6 months)
• Business plan prepared (if start-up or significant loan)
• Personal credit score checked
• Security available identified (if secured loan)
• Spoken to us for initial assessment

During Application

• All requested documents provided promptly
• Questions answered fully and honestly
• Business plan polished and professional
• Financial projections realistic and justified
• References provided if requested
• Responded quickly to any lender queries

Before Accepting Offer

• Interest rate and APR understood
• Total repayment amount calculated
• Monthly payment fits comfortably in budget
• Loan term appropriate for purpose
• Early repayment terms checked
• All fees and charges understood
• Loan agreement read thoroughly
• Discussed any concerns with us

After Loan Completion

• Set up direct debit for repayments
• Add repayment dates to business calendar
• Use funds for intended purpose
• Monitor business performance carefully
• Maintain cash flow buffer for repayments
• Keep lender informed of any business changes
• Consider early repayment if possible and no penalties

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Common Business Loan Mistakes to Avoid

1. Borrowing Too Much

The mistake: “I might need £100k, so I’ll borrow £150k to be safe”

Why it’s bad:

• Higher repayments than necessary
• More interest paid
• Temptation to use funds for non-essential purposes
• Reduces future borrowing capacity

Better approach: Calculate exactly what you need, add 10% contingency maximum

2. Borrowing Too Little

The mistake: “Loan payments will be lower if I only borrow £30k instead of £50k”

Why it’s bad:

• Project underfunded and fails
• Have to go back for more finance (harder second time)
• Miss opportunities through lack of funds

Better approach: Be realistic about full cost of plans, include contingency

3. Wrong Type of Finance

The mistake: Taking a 3-year loan to buy property you’ll own for 20 years

Why it’s bad:

• Repayments too high for term
• Refinancing hassle and cost when term ends
• Property needs long-term finance

Better approach: Match finance term to asset life/business purpose

4. Not Shopping Around

The mistake: Taking first offer from your bank without comparing

Why it’s bad:

• May pay 2-3% more interest than necessary
• £100k over 5 years at 12% vs 8% = £6,400 difference in cost

Better approach: Use a broker (like us!) to access multiple lenders

5. Ignoring Total Cost

The mistake: Focusing only on monthly payment, not total repayable

Why it’s bad:

• Longer terms reduce monthly payment but increase total cost significantly
• £50k over 3 years at 9% = £6,900 interest
• £50k over 7 years at 9% = £17,000 interest

Better approach: Look at both monthly cost AND total cost

6. No Cash Flow Buffer

The mistake: Spending all available cash, assuming loan covers everything

Why it’s bad:

• Unexpected costs arise
• Sales take longer than expected
• One missed payment causes credit damage

Better approach: Keep 3-6 months operating expenses in reserve

7. Using Short-Term Finance for Long-Term Needs

The mistake: Using merchant cash advance (expensive) to buy equipment you’ll use for 5 years

Why it’s bad:

• Repay quickly at high cost
• Cash flow severely impacted
• Equipment finance would be 50%+ cheaper

Better approach: Match finance type to need duration

8. Not Reading Terms

The mistake: Signing without reading all terms and conditions

Why it’s bad:

• Early repayment charges you didn’t know about
• Variable rates that can increase
• Personal guarantee clauses
• Hidden fees

Better approach: Read everything, ask questions about anything unclear

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Alternative Business Funding Options

Sometimes a traditional business loan isn’t the best fit. Consider:

Grants

Advantages: Don’t need to repay, no interest, no equity given away

Disadvantages: Competitive, time-consuming application, restricted uses, often match-funding required

Liverpool sources:

• Liverpool City Council business grants
• Liverpool City Region Combined Authority
• Innovate UK (for innovation/R&D)
• Sector-specific grants (creative, tech, manufacturing)

Our advice: Always worth checking grant availability before borrowing

Equity Investment

Advantages: No repayments, investor expertise, larger amounts possible, no personal guarantees

Disadvantages: Give away ownership, loss of control, investor expectations, complex process

When suitable: High-growth businesses, tech startups, businesses needing significant capital and expertise

Liverpool resources:

• Merseyside Special Investment Fund
• NPIF (Northern Powerhouse Investment Fund)
• Angel investors networks
• Venture capital firms

Crowdfunding

Advantages: Marketing benefit, customer validation, no interest (if rewards-based), retain control

Disadvantages: Time-consuming, requires strong pitch, all-or-nothing risk, platform fees

Types:

• Rewards-based (Kickstarter, Indiegogo)
• Equity crowdfunding (Crowdcube, Seedrs)
• Loan crowdfunding (Funding Circle)

Best for: Consumer-facing businesses, creative projects, products with strong story

Personal Savings

Advantages: No interest, no repayments, no applications, retain full ownership

Disadvantages: Risk personal finances, limited to available savings

Our advice: Using some personal funds shows commitment to lenders, but don’t risk all savings

Retained Profits

Advantages: No cost, no applications, no risk to assets

Disadvantages: Slower growth, opportunity cost

Best approach: Reinvest profits for organic growth, use loans for larger opportunities

Friends & Family

Advantages: Potentially flexible terms, lower or no interest, understanding lenders

Disadvantages: Risk damaging relationships, informal agreements problematic, can still lose money

Our advice: If borrowing from friends/family, treat it formally – written agreement, clear terms, regular updates

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Tax Implications of Business Loans

Important: We’re not accountants – always consult your accountant for tax advice. General guidance only:

Interest Tax Relief

Limited companies: Loan interest is usually tax-deductible business expense (reduces corporation tax)

Sole traders: Loan interest for business purposes usually tax-deductible (reduces income tax)

Mixed use: If loan partly personal use, only business portion deductible

Record keeping: Keep loan statements showing interest paid

Capital vs Revenue

Revenue expenses (tax-deductible immediately): Working capital, stock, short-term expenses

Capital expenses (tax relief via capital allowances): Equipment, vehicles, property improvements

Impact: Affects timing of tax relief, not whether you get it

Directors’ Loans

Different rules: If director lends to company or vice versa, different tax implications apply

Our advice: Formal business loan from external lender is cleaner than director loan arrangements

VAT

Good news: Loan payments are not subject to VAT Exception: Some fees (broker fees, legal fees) may have VAT added

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Understanding Business Loan APR

APR (Annual Percentage Rate) shows the true cost of borrowing including interest and fees.

How APR Works

Example 1: Unsecured Business Loan

• Loan amount: £50,000
• Term: 5 years (60 months)
• APR: 9.5%
• Monthly payment: £1,045
• Total repayable: £62,700
• Total interest & fees: £12,700

Example 2: Secured Business Loan

• Loan amount: £150,000
• Term: 10 years (120 months)
• APR: 6.5%
• Monthly payment: £1,705
• Total repayable: £204,600
• Total interest & fees: £54,600

Example 3: Short-Term Working Capital

• Loan amount: £25,000
• Term: 12 months
• APR: 12%
• Monthly payment: £2,224
• Total repayable: £26,688
• Total interest & fees: £1,688

Comparing APRs

Lower APR doesn’t always mean lower total cost if terms are very different:

Option A: £100,000 at 8% over 3 years = £12,987 interest Option B: £100,000 at 7% over 7 years = £27,283 interest

Option A costs more per month but less overall.

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Refinancing Business Loans

When to Consider Refinancing

Interest rates have fallen since you borrowed Your credit score has improved significantly Your business is now stronger (better rates available) Existing loan has expensive early repayment terms that have expired Want to consolidate multiple loans into one payment

Refinancing Process

1. Check your current loan’s early repayment charges
2. Calculate break-even point (when savings exceed fees)
3. Apply for new loan at better rate
4. Use new loan to repay old loan
5. Save money on lower payments or shorter term

Example Refinancing Scenario

Original loan (taken 3 years ago):

• Amount: £100,000
• Remaining: £65,000
• Rate: 11% APR
• Monthly payment: £1,480
• 5 years remaining

Refinanced loan (today):

• Amount: £65,000
• Rate: 7.5% APR
• Monthly payment: £1,300
• 5 years

Savings: £180/month (£10,800 over remaining term)

Our service: We can review your existing loans and identify refinancing opportunities

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Business Loan Consolidation

What is Loan Consolidation?

Taking one new loan to repay multiple existing loans

Benefits

✓ Single monthly payment instead of multiple ✓ Potentially lower overall rate than average of existing loans ✓ Simpler financial management ✓ Improved cash flow if term extended ✓ Clear debt repayment date

When It Makes Sense

• Multiple business loans with different lenders
• Mix of business credit cards and loans
• Invoice finance becoming expensive
• Merchant cash advances draining cash flow
• Overdraft constantly at limit

Example Consolidation

Current debts:

• Business Loan 1: £35,000 at 12% (£850/month)
• Business Loan 2: £25,000 at 10% (£530/month)
• Business credit cards: £15,000 at 18% (£450/month)
• Overdraft: £10,000 at 15% (£125/month interest)
• Total: £85,000 debt, £1,955/month payments

Consolidated secured loan:

• Amount: £85,000
• Rate: 7% APR
• Term: 7 years
• Monthly payment: £1,245

Result: Save £710/month, improve cash flow, single payment to manage

Consideration: Longer term means more interest overall, but monthly savings can be crucial for struggling cash flow

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Recent Liverpool Business Success Stories

Technology Sector Growth

Liverpool’s tech scene is booming, particularly in the Baltic Triangle. We’ve helped numerous tech startups and scale-ups access growth capital:

• Software companies funding development teams
• Digital agencies expanding service offerings
• E-commerce businesses scaling operations
• Creative businesses investing in equipment and studio space

Recent funding: Baltic Triangle software company secured £240,000 to hire 6 developers ahead of major client project launch.

Hospitality Expansion

Liverpool’s hospitality sector remains strong with tourism and student population driving demand:

• Independent restaurants opening second locations
• Coffee shops expanding across city
• Bars and pubs refurbishing and modernizing
• Hotels upgrading facilities

Recent funding: Restaurant group secured £420,000 to open third location in Liverpool ONE catchment area.

Manufacturing Investment

Speke and Knowsley industrial estates seeing significant investment:

• Production line upgrades
• Capacity expansion
• New product line development
• Export market preparation

Recent funding: Food manufacturer secured £680,000 for new packaging line to service major supermarket contract.

Retail Innovation

Bold Street and independent retail continues to thrive:

• Store fit-outs and refurbishments
• Stock purchases for seasonal demand
• E-commerce platform development
• Multi-channel retail expansion

Recent funding: Fashion retailer secured £95,000 for second store opening and e-commerce website development.

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Getting Started

Free Business Loan Consultation

Contact us for no-obligation discussion about your business funding needs.

We’ll discuss:

• What you want to achieve
• How much funding you need
• Your business background and trading history
• What type of finance suits best
• Approximate rates and terms you can expect
• Timeline and process
• Any concerns or questions

Duration: Typically 30-45 minutes

Format: Phone, video call, or face-to-face at our Liverpool office

What to Have Ready

For initial conversation:

• Brief description of your business
• How long you’ve been trading
• Approximate annual turnover
• What you need funding for
• How much you need
• Rough idea of your available security (if any)

Don’t worry if you don’t have all details – we’ll work through it together

Next Steps

1. Contact us – phone, email, or office visit
2. Initial discussion – we assess your situation
3. Documentation – we’ll explain exactly what’s needed
4. Application – we compile and submit to suitable lenders
5. Offers – we present options with pros/cons explained
6. You decide – choose the best option for your business
7. Completion – we manage the process through to funding
8. Your business grows – you use funds to achieve your goals

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Contact Liverpool Commercial Finance

Ready to discuss business funding for your Liverpool company?

Phone: 0151 314 8757
Email: admin@liverpoolcommercialfinance.co.uk
Office: 49 Jamaica Street, Liverpool L1 0AH

Office Hours:

• Monday to Friday: 9am – 6pm
• Saturday: 10am – 2pm (by appointment)
• Evening appointments available by arrangement

Visit Our Office

Location: Central Liverpool, easy access by car or public transport

Parking: Multiple NCP car parks within 5 minutes

Public transport:

• Liverpool Lime Street: 10 minutes walk
• Moorfields Station: 5 minutes walk
• Multiple bus routes nearby

What to bring:

• Recent business accounts (if available)
• Business bank statements (if available)
• Brief notes on what you need funding for
• Any questions you have

No pressure – initial consultation is exploratory and educational. We’ll give you honest feedback about your options.

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About Liverpool Commercial Finance

We’re a team of business finance specialists based in Liverpool city centre with over 30 years of combined experience helping Liverpool businesses access funding.

Our Background

Our team includes:

• Former bank business lending managers
• Business owners who’ve borrowed and grown
• Commercial finance specialists
• Industry-specific advisers

We’ve helped hundreds of Liverpool businesses across all sectors access funding from £5,000 to £5 million.

Our Approach

We’re business people first, finance brokers second. We understand:

• The challenges of running a business
• How funding decisions impact your business
• The stress of borrowing money
• The importance of getting terms right

We’re not salespeople pushing products. Our role is to:

1. Understand your business and goals
2. Identify the best funding options
3. Present honest pros and cons
4. Help you make informed decisions
5. Then deliver the process efficiently

Why Businesses Choose Us

Local knowledge: We understand Liverpool business challenges and opportunities

Multiple lenders: Access to 60+ lenders means we find the best fit for your situation

Experience: We’ve seen every scenario – your situation isn’t unique to us

No upfront fees: We only get paid when you get funded

Honest advice: If borrowing isn’t right, we’ll say so

Face-to-face service: We’re here in Liverpool, available to meet

Ongoing support: Many clients return for second, third, fourth funding rounds as they grow

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Areas We Serve

While based in Liverpool city centre, we arrange business loans across:

Liverpool: All L postcodes (L1-L40) Wirral: All areas including Birkenhead, West Kirby, Heswall Sefton: Southport, Formby, Crosby, Maghull Knowsley: Prescot, Huyton, Kirkby, Whiston St Helens: All WA9-WA11 postcodes Halton: Widnes, Runcorn Warrington: All WA postcodes West Lancashire: Ormskirk, Skelmersdale Cheshire: Chester, Ellesmere Port, Frodsham

Wherever your Liverpool City Region business is located, we can help.

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Commitment to Liverpool Business

Liverpool is experiencing remarkable growth and regeneration. From the Baltic Triangle’s tech boom to the Ten Streets development, from the thriving hospitality sector to advanced manufacturing in our industrial estates – Liverpool businesses are creating jobs, innovation, and prosperity.

We’re proud to support that growth by helping Liverpool businesses access the funding they need to succeed.

Every business loan we arrange helps a Liverpool business grow, employ more people, serve more customers, and contribute to our city’s continued success.

That’s why we do this.

Let’s discuss how we can help your Liverpool business grow.

Call today: 0151 314 8757

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Liverpool Commercial Finance
Expert business funding for Liverpool companies

30+ years combined experience | 60+ lenders | No upfront fees | Liverpool city centre based