Asset-based loans - do you really need one? ?? (hint: you probably don't) ??

An asset-based loan is essentially a loan secured by collateral. ????

Collateral can take various forms, from buildings to receivables and claims on future cash flow. ??????

Typically, you won't require this type of loan if you can secure an uncollateralized loan. ????

If you are contemplating taking an asset-backed loan, it suggests that your financial conditions may not be strong enough to secure funding for your business without collateral. ????

Moreover, asset-backed loans are usually more expensive. ????

The one potential advantage of opting for this type of loan is that it should involve fewer restrictions in terms of covenants. ????