Comparing business loans by how much you need

How much you need is one of the quickest ways to narrow the field. A $15,000 need and a $1.5 million need live in completely different parts of the lending market, with different security, paperwork, timeframes and costs. This page groups the main options by amount.

Which loan types suit which amounts?

Amount	Options to compare first	Security usually involved	Paperwork level
$5k to $50k	Unsecured loan, line of credit, equipment finance	Guarantee, or the asset	Light
$50k to $250k	Unsecured for strong trading, equipment finance, invoice finance, secured loan	Guarantee, asset or property	Light to moderate
$250k to $500k	Unsecured for very strong trading, property-backed, invoice finance	Property increasingly common	Moderate
$500k to $5m	Property-backed, commercial property	Property	Fuller financials

How is the amount worked out?

For unsecured lending, lenders look at:

• Average monthly turnover from bank statements.
• How much existing debt already takes each month.
• Time in business and industry.
• The purpose and how it will be repaid.

For property-backed lending, the main driver is equity: the property’s value minus what’s owed, and how much of that a lender will lend against. Your ability to service the loan still matters, especially for longer terms.

How much should you borrow?

A sensible amount usually equals:

1. The quoted cost of what you’re funding.
2. Plus related costs: installation, freight, fit-out, stamp duty, legal fees.
3. Plus a modest buffer for overruns.

Then test it the other way round: can the business comfortably carry the repayment in a slow month? If not, borrow less, extend the term or add security.

Why can borrowing too much be a problem?

• You pay for money you don’t use.
• Repayments are higher than they need to be.
• Approval can be harder when the request is out of proportion to turnover.
• Surplus funds tend to get spent.

If you want a safety margin, a small line of credit is often cheaper than a bigger term loan.

Illustrative example. A Launceston printing business plans a $210,000 press upgrade. Monthly turnover is around $90,000. An unsecured lender offers $120,000, which leaves a gap. Options: equipment finance on the press itself for most of the cost, or a property-backed loan against the owners’ home for the full amount. They choose equipment finance for $190,000 and fund the rest from cash, keeping their home out of it.

What changes as the amount grows?

	Smaller amounts	Larger amounts
Speed	Faster	Slower
Paperwork	Bank statements	Financials, tax returns, property documents
Term	Shorter	Longer
Security	Guarantee or asset	Property common
Comparison effort	Moderate	High: small differences in cost add up to large dollar amounts

On bigger loans, a careful comparison matters more, because a small difference in pricing or fees becomes a large dollar figure. The loan offer comparer helps.

How do lenders check that the amount is affordable?

Whatever the security, lenders want to see that the repayments fit the business. The checks differ by loan size:

• Smaller unsecured loans look at the share of monthly turnover the new repayment would take, alongside existing repayments.
• Mid-sized loans add BAS or financial statements to confirm turnover and profit.
• Larger and property-backed loans often look at servicing in more detail: profit, existing commitments, the directors’ personal position and sometimes a cash flow forecast.

You can run a version of this yourself before applying:

Step	What to do
1	Average your monthly deposits over the last six months
2	Note your lowest month
3	Add up existing loan repayments per month
4	Convert the new repayment to monthly
5	Check that all repayments together sit comfortably inside the lowest month’s surplus

If the numbers are tight, the most effective fixes are usually a smaller amount, a longer term within the purpose’s life, adding security, or clearing a small existing debt first. Asking for an amount that’s in proportion to your turnover often gets a faster, cleaner answer than asking for the maximum.

Tell us how much you need and why

Give us the amount and purpose and we’ll tell you which part of the market fits. Enquiring doesn’t touch your credit file; a check only comes up once you choose to proceed. We don’t spray your details across a list of lenders. A real person sizes the request against your turnover and any security, and compares the options that fit that amount.

Please give accurate figures on the form for turnover, the amount and any property. Start your enquiry, or put your amount into the comparison tool and then check your options.