Loans: A Basic Guide to Your Options
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Loans: A Basic Guide to Your Options

loans: a guide to your options

This guide to loans contains:

Your main choices

When choosing loans, it will be easier and cheaper if you are prepared to:


The main choice here is usually between secured loans and unsecured loans. For secured loans, you take more risk in order to get a lower APR (interest rate).

If relevant, decide whether your business should be a limited company or partnership/sole trader, the latter involves greater risk for you.

Also, choosing between fixed-rate, variable-rate or capped, can help protect yourself from the impact of interest rates going up and down.


Flexible loans give you the option to overpay the loan monthly and/or settle it early with a single payment. Fixed loans commit you to a specific monthly payment; you may be stuck with the loan for a long time, or have to pay significant financial penalties if you decide to pay it off early.

Cash management

Discounts, cashback or payment holidays can help you over cash flow problems, but the interest rate you pay is likely to be higher.

Financial projections

Not all lenders will be interested in financial projections, but convincing your bank manager that you can easily afford the repayments may save you some money.

Who you consult

This is basic common sense of shopping, but getting a number of quotes from banks, lenders, or agents (whether independent or tied) increases your chances of finding something better and cheaper.

Other options...

...for buying something for which you don't have the cash include:

You can also considering restructuring your finance (replacing existing loans with other loans on different repayment terms).

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