Unsecured Business Loans: Quick funding | Excel Capital
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Unsecured Business Loans: How They Work, Uses, and How to Qualify

Unsecured business loans: at a glance



When it comes to acquiring a loan from a traditional bank, many business owners find themselves in a sticky situation due to the heavy requirements and long time frames to funding. Unsecured business loans were created to avoid these common issues with traditional business loans and make quick small business loans possible.


Most banks will only approve you for business loans if your business is at least two years old and only if the loan is secured and you can show positive cash flow and profit on your tax return.


Most Business owners under 2 years in business show a loss. From our experience over 70% of business owners, less than 2 years don’t show a profit due to startup costs and investments.


This means that if the business owner fails to make a payment or goes into default, the bank can seize collateral such as business property, equipment, cash savings and deposits, and even personal assets.


In addition, your business needs to have great to excellent credit.


You can see how this can be problematic for new businesses.


Many business owners have no collateral or low credit scores (often both). So, what do you do? That’s where unsecured business loans can be invaluable.


With no personal guarantees or collateral required as well as funding (and approval) in as little as 24 hours, an unsecured business loan with Excel Capital can give your business the funds it needs to move forward in times of expansion– or stay afloat when your business is in need of cash.


Click here to complete our short one-page application and see how much you can get approved for today.


Having said that, below, we’ll cover how unsecured business loans work, why they’re useful, rates and terms, as well as how to get approved for a quick business loan in as little as 24-48 hours:


  1. How an unsecured business loan works
  2. What is an unsecured business loan good for?
  3. Unsecured business loan rates and repayment terms
  4. How to qualify for an unsecured business loan



How an unsecured business loan works




Unsecured business loan amounts typically range anywhere from $10,000 to $2,000,000 depending on the cash flow of the business being underwritten.


They don’t require you to put down any form of collateral. Hence, making them unsecured for the lender. However, you still need to meet certain basic requirements.


The amount of the loan is dependent upon your:


  • Business’ credit score
  • Average monthly bank balance, and
  • Annual revenue


Unsecured business loans will typically range between 75% to 150% of your last 3 months average gross monthly sales. That means if you deposited $100,000.00 on average for the past 3 months, your business can qualify for $75,000.00 to $150,000.00. Terms typically range between 6 and 18 months.


Keep in mind that if a cash amount is not approved, you as business owner may instead be offered a line of (unsecured) credit.


In addition, while secured business loans requires collateral, such as your house, car, 401k, inventory or account receivables, unsecured loans only require you to pledge limited collateral such as your future sales that only apply to your business.


In fact, funding contracts explicitly state that if you stop having receivables and you go out of business, you’re not entitled to pay back the business loan.


This is one of the primary benefits of an unsecured business loan. If your business hits a rough patch and you has trouble making payments, or default on the loan, there’s no collateral to lose.


In fact, we’ve found this process to be largely ineffective for ourselves as a lender as well.


It’s our goal to work with you, not against you. So, if you do struggle to make loan payments, we’ll help find you a solution to correct the problem, improve your working capital, and get current once again.



What is an unsecured business loan good for?


An unsecured business loan can be used for virtually anything you can think of but most use it for working capital.


When business is up, you can use it to:


  • Purchase supplies
  • New equipment
  • Make new hires
  • Add another location
  • And much more


And when business is down:


  • Pump cash into the business
  • Pay accounts payable
  • Pay taxes or other obligations
  • Increase marketing
  • And payroll


Once you obtain an unsecured business loan, it’s completely up to you to determine how you spend the capital to grow or maintain your business.


It’s best to put the capital to work in ways that will help you increase sales and profits, therefore using the capital to create more cash flow over time. However, ultimately, you’ll be the best judge of how to do that with your business.


Unsecured business loan rates and repayment terms


Unsecured business loans are distinctly different when compared to traditional bank loans.


Clearly, the lack of a personal guarantee or collateral is a huge upside, however, as you might imagine, this upside comes with some downsides.


The max terms for an unsecured business loan are 18 months with payments being due either monthly, weekly, or daily depending on the loan terms.


In addition, rates vary depending on risk. They can be as low as 14% on an unsecured loan but they can also go much higher as well. A big upside to this, however, is that we can get you approved even if you have a bad credit score and have delinquent or even maxed out tradelines.



How to qualify for an unsecured business loan


Requiring both 2 years of business history and a stellar credit rating, traditional bank loans are out of reach for many business owners.


However, if you find yourself in that boat, an unsecured business loan may just be the perfect solution to your funding needs.


The benefits of an unsecured business loan are clear, but what are the requirements?


What’s required to qualify for an unsecured business loan?


According to the Mission Asset Fund, businesses are most often denied loans due to “having no credit history or a low credit score.”


Despite this, banks still prioritize credit scores and use an outdated credit-first model for approving (or denying) you for a business loan of any kind.


Rather than dwelling on factors that truthfully have little to do with the state of your business now, we like to focus on the present by looking at the business’ current conditions.


With Excel Capital, there’s no minimum credit score required to qualify for an unsecured loan.


When determining if your business is right for an unsecured business loan, our underwriters analyze a variety of metrics such as big data, historical risk models, and trade line distribution to determine its unique growth potential instead of just looking at your credit score.


Having said that, before we can qualify you for a loan, there are 2 qualifications that you must meet:


  1. Records showing at least $10,000 of monthly gross revenue
  2. Proof that you’ve been in business for at least six months


Do banks provide unsecured business loans?


Banks do provide unsecured business loans, however, it’s rare to find one and the requirements are extremely rigid.


Banks want to get their money back first and foremost, and aren’t much interested in serving you as a customer, so they’re looking for highly profitable companies that have been in business for a long time.


For that reason, using a traditional bank to get a business loan comes with a variety of strings attached.


For starters, in many cases you have to pay an upfront application fee just for the banks to process your application. To make matters worse, often times, you won’t get your money back even if your application is denied.


A second problem with relying on a bank to provide your unsecured business loan is time. Due to a plethora of banking regulations, regulations that an alternative lender like ourselves doesn’t have to withhold to, banks send you through a large amount of red tape to determine whether or not they will provide you with a small business loan.


All this taken into account, it can take months until you get your money and only if they approve you.


How can I get an unsecured business loan?


A whopping 82 percent of small businesses fail from running out of cash. Is your business in danger of running out of cash flow?


Until recently, obtaining a business loan was a long, cumbersome process that required trails of paperwork and inconvenienced your day-to-day business operations.


So, we decided to fix that by creating an expedited process to allow small business owners to get through the application process as quickly as possible so you can get back to focusing on what matters– your business.


With Excel Capital, getting the cash your business needs to maintain growth– or simply get through a rough season– has never been easier.


Simply complete our short, one page application by clicking here and submit your last 4 months of business bank statements.


You’ll get an approval decision from us in less than 24 hours and, pending approval, funds will be deposited within your account in as early as 24 hours as well.


Imagine what a surge of cash could do for your business, from providing the funds you need to purchase much-needed equipment to paying off past-due vendors, and virtually anything else in between.


Click here to complete our short one-page application and see how much you can get approved for today.

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