Secured Business Loan by Muthoot Capital
Secured business loans or collateral business loans require a company asset like land, property, or equipment to be offered as security in case the borrower defaults. You can get a longer tenure and lower interest rate on a secured loan. The Company provides Secured loans to entities with a short track record and low asset base which are unable to get finance from commercial banks. This will enable the borrowers to develop their business and to build an unencumbered portfolio which can be assigned later.
Key Benefits and Features
Secured business loans are the safest way to get capital for expanding or scaling up your business.
Assets as security
If your business is not eligible for an unsecured loan, but possesses assets like land, property, equipment, machinery or any commercial property, these business assets can be pledged as security to avail a secured business loan in India.
Unlocks the value
Unlocks the value of your asset.
lower interest rates
The interest rates are lower than you would get in the case of unsecured loans.
Secured Business Loan Eligibility
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Secured loans are available to proprietorship firms / partnership firms / limited liability companies, who have sound credentials including financial performance backed by adequate financial statements / documents…
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The applicants should also meet the following criteria: (a) Type of applicants: NBFC, NBFC-MFI, HFC Manufacturing units Trading units Service units (b) Asset Classes: Receivables in respect of microfinance, housing finance,…
Read MoreDocuments Required For Secured Business Loan
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Sanction Letter from MCSL duly accepted by the borrower.
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Facility Agreement.
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Deed of Hypothecation.
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Demand Promissory Note executed by the borrower in favour of MCSL.
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Security cheques (in case of NACH mode of repayment) from the borrower covering the payment of the entire loan amount according to the repayment schedule along with applicable interest.
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If secured by any other asset, documentation creating charge over the asset so provided as collateral security in favour of MCSL as a security for the facility and search report stating therein that the asset is free from all encumbrances.
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Power of Attorney in favour of MCSL.
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Guarantee agreement signed by the guarantors.
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Any other document as may be agreed with the borrower at the time of finalising the terms of the transaction.
Types of Secured Business Loan
Secured by Collateral
There are many types of secured business loans in India. These are specifically loans that are secured by collateral owned by the business.
- Loan against mortgaged property is perhaps the most common form of secured loan. As the value of the mortgaged property is high, it can get the longest tenure.
- Loans against government securities, fixed deposits and even savings accounts are considered secured loans. You can avail of these types of secured loans from us. The funds that are used as security cannot be used till the loan is repaid.
- Gold and precious metals loans are the other secured loan options.
Secured by Personal Guarantee
- Secured loans for small businesses are offered on the business owner’s personal guarantee too. If the business does not have any security that can be offered as collateral we can offer a secured small business loan against the pledge of a personal guarantee. The property, land or gold of the proprietor or partner can be used to secure the loan.
- The property can be pledged as limited liability or unlimited liability and is likely to be attached if installments are not paid on time. Only the amount of loan is recovered by us in case of default by possession of the pledged property.
Fees & Charges of Secured Business Loan
Our representative will contact you to get the process initiated for the secured business loans. There are a few charges and fees that are applicable over and above the interest rates when you apply for a loan.
A nominal one-time processing fee is applicable.
Assorted charges such as documentation, registration certificate collection, stamp duty, amortization charges, and so on are applicable.
A nominal charge for pre-paying the loan may be applicable
Please get in touch with our customer care representative to know details about our collateral business loans.
Secured Business Loan FAQs
Why Should I Choose A Secured Business Loans?
Secured business loans are the most economical way to secure working capital, buy equipment or scale up operations for a business. You also unlock the monetary value of your asset in the process.
- In the event that you are unable to obtain an unsecured loan and you have a business owned asset you can pledge, a collateral business loan is the best option.
- Secured business loans in India are safe for the lender given the prevailing tightened lending norms. We are secure and can in some cases overlook personal guarantees.
- The interest rate is lower on the secured business loans in India.
- The tenure offered is also longer than what you would get for unsecured loans.
What Is Secured Business Loan?
Secured business loans require collateral to be provided in the form of a security. A secured loan for small business needs a company asset like property, equipment or land to be offered as security in case of default. The interest rates are lower and the tenure is longer. It is a good way to help expand your business.
How Do I Get A Secured Business Loan?
Secured business loans can be availed by proprietorship, partnership, limited Liability companies having sound credentials. All that you need to do is contact us at 1800 102 1616 for a representative visit. The eligibility criteria for secured loan for small business need to be fulfilled and the asset offered needs to be verified to initiate the process. The asset under consideration, savings, invoices, inventory and any blanket Lien is considered. Once the due diligence is done, you can avail the loan.
How Do Secured Business Loans Work?
Secured business loans are offered with collateral offered by the loan seeker. This collateral can be liquidated if the loan goes into default mode. The risk in offering a collateral business loan is low, so we can offer lower rates of interest. Once the loan is granted, you pay an EMI which comprises of a part of the principal amount, interest and applicable taxes as per the loan schedule.
Are Small Business Loans Secured Or Unsecured?
Small businesses are often managed by family and the structure of the business is largely informal. Currently, we offer secured loan for small business. This loan is easier to procure as it carries lower risk. The rates of interest for a secured business loan are lower as compared to unsecured business loan, and you can opt for a longer tenure.
Do You Need Collateral For A Business Loan?
Yes, you need to provide a collateral for our secured business loans. The collateral has to be put up by the business owner/owners. The asset should be clear and the deed discrepancy free in the name of the borrower. Collateral business loans are cheaper and carry lower risk. Contact our customer care representative for further details.
What Kind Of Collateral Do You Need For A Small Business Loan?
The collateral business loan requires you to pledge assets like house property, land, or equipment and in some cases gold. The asset should be free and the deed should be in the name of the borrower. You can contact our customer care representative at 1800 102 1616 to know get clarity on the type of collateral before you apply for a secured loan online.
Does Collateral Have To Equal Loan Amount?
Yes, the collateral has to be more or at least equal to the loan amount of the collateral business loan amount. Get an appraiser to judge the value of the collateral you want to pledge - your house property, land or equipment. Before you apply for the secured business loan online, contact our customer care representative to help you understand the loan amount you can apply for basis the value of your collateral.
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