Business loans without using your home as security

Some owners are clear from the first minute: “I’m not putting the house up.” That’s a completely reasonable position, and it doesn’t mean you can’t borrow. It means your business’s trading has to do the talking.

What are the options that don’t use your home?

For trading businesses, the main options are:

Option	How it works	Often suits
Unsecured business loan	A lump sum repaid over a set term	Equipment, fit-outs, one-off costs
Business line of credit	A limit you draw on and repay as needed	Supplier payments, cash-flow gaps
Cash-flow loan	Sized mainly on recent revenue	Short-term needs for steady traders

These typically run from $5,000 to $500,000, sized on turnover and bank statements. There’s no mortgage or caveat registered on your home.

What do lenders look at instead of property?

Without property, the lender leans on evidence that the business can repay from its own income:

• Business bank statements — steady deposits, few dishonours, business costs paid from the business.
• BAS — lodged and up to date.
• Trading history — usually a steady run under your ABN.
• Your credit file — checked once you decide to proceed.
• Existing debts — including any ATO balance, which is considered case by case.

The cleaner your statements, the stronger the case. If personal and business money share an account, a lender may struggle to see your true turnover. Our page on separating finances before borrowing shows how to fix that.

Does unsecured mean no personal risk?

Not quite, and it’s important to be clear about this.

• Sole traders are personally liable for all business debts. business.gov.au says sole traders have “unlimited liability and all your personal assets are at risk if things go wrong”.
• Company directors are usually asked for a personal guarantee, even on unsecured loans.

What “unsecured” does mean is that your home isn’t pledged, so the lender has no direct claim over it. That’s a meaningful difference — but it isn’t a force field. Our page on protecting the family home covers how to keep risk down across the board.

What are the trade-offs versus a home-secured loan?

	Unsecured	Home-secured
Home pledged	No	Yes
Typical size	$5k – $500k	$20k – $5m
Assessment	Trading and statements	Property plus ability to repay
Term	Often shorter	Can be longer
Repayments	Can be larger per month for the same amount	Can be spread further
Credit flexibility	Less, generally	More, generally

Shorter terms mean repayments need to fit comfortably inside your monthly cash flow. That’s where honest numbers matter. Tell us your average monthly deposits and we’ll show you what’s realistic without the house.

What if unsecured isn’t enough?

A few middle paths:

• Combine a smaller unsecured facility with a modest secured amount.
• Use a different property — see investment property as security.
• Stage it — borrow for the first phase now, and the next once the first is paying off.
• Contribute more yourself from savings, if you can do so comfortably.

Illustrative example: A salon owner wants $45,000 to refurbish two stations and buy new equipment. She’s firm that the family home stays out of it. Her business account shows two years of steady deposits and she’s up to date with BAS. An unsecured loan sized on turnover is realistic, with a term chosen so repayments fit her quietest month.

Are there industries where unsecured is harder?

Lenders look at every business on its merits, but very seasonal businesses, or those with one dominant customer, may find unsecured lenders more cautious. Showing a full year of statements and explaining your pattern helps. The micro business loans page covers how small operations can present the risks lenders ask about.

How do you strengthen an unsecured application?

Because there’s no property to lean on, small improvements in how your business looks on paper make a big difference:

1. Run everything through one business account for at least a few months before applying.
2. Keep the account in credit. Frequent overdrawn days or dishonoured payments are one of the first things an unsecured lender notices.
3. Lodge BAS on time, and if you owe the ATO, be on a payment plan and keep to it.
4. Know your numbers: average monthly deposits, your biggest customers and your seasonal pattern.
5. Ask for what you need. A modest, well-explained amount is easier to approve than a round number with no purpose attached.
6. Don’t shotgun applications. Each formal application can leave an enquiry on your credit file for five years. One matched approach is kinder to your file.

Can I move to unsecured later if I use property now?

Sometimes, yes. Some owners use property security to get started, then refinance to an unsecured facility once the business has a longer track record and stronger statements. It isn’t guaranteed — it depends on how the business performs and on lender policy at the time — but it’s a reasonable goal to build into your exit plan. It also gives you a clear milestone for getting the house off the documents.

Keep the house out and still get a real answer

You’re allowed to draw a line around your home, and we’ll respect it. The enquiry takes about 60 seconds with no credit check, and it goes to one specialist — not a dozen lenders. They’ll call to understand your turnover and what you need, and tell you honestly what’s possible without property. Please answer the form accurately, including that you’d prefer not to use your home, so we can go straight to the right options.

See what’s possible without the house →