In today’s financial climate, accessing affordable capital is one of the biggest challenges for businesses and investors. Interest rates remain elevated, lenders are cautious, and many traditional funding routes are more expensive or restrictive than they were just a few years ago.
For those who own property, however, there is a powerful tool already within reach: equity. By unlocking equity tied up in existing property, businesses and investors can finance expansion, consolidate debts, or seize new opportunities - often at more competitive rates than unsecured borrowing.
What Does It Mean to Unlock Equity?
Equity is simply the difference between a property’s current market value and the outstanding balance on any mortgages or loans secured against it. For example, if a property is valued at £500,000 and £300,000 remains on the mortgage, the owner has £200,000 in equity.
That equity can be accessed through a secured loan (often called a homeowner loan or second charge mortgage). Unlike remortgaging, which replaces the original loan, a secured loan sits alongside it, allowing owners to raise additional capital without disturbing existing terms.
Why Equity Release Beats Other Financing Options
Unlocking property equity offers several advantages over more conventional borrowing routes:
- Lower costs: Secured loans generally carry lower interest rates than unsecured business loans or overdrafts, since lenders have collateral as security.
- Access to larger sums: Equity-based lending can fund substantial projects - from multi-property acquisitions to significant operational investments.
- Flexible terms: Repayments can be structured over longer periods, matching the timescales of business growth.
- Accessibility: Even with a less-than-perfect credit record, borrowers may qualify, as the property itself offsets some of the lender’s risk.
For entrepreneurs and property investors, this makes equity release one of the most practical ways to fund ambitious growth.
Common Business Applications
Unlocking property equity isn’t just about raising cash - it’s about creating strategic opportunities. Businesses and landlords are increasingly using secured loans to:
- Expand operations: Finance new premises, equipment purchases, or staff hires.
- Diversify: Fund the launch of new products or services.
- Grow portfolios: Use equity in one property to secure another investment property.
- Consolidate debts: Replace multiple high-interest debts with a single, more manageable repayment plan.
By redeploying capital that would otherwise remain locked in bricks and mortar, owners can put their assets to work in ways that directly support growth.
Key Risks to Consider
As with any leveraged decision, using property equity comes with risks. Borrowers should consider:
- Property at risk: If repayments aren’t met, the property could be repossessed.
- Reduced future flexibility: Additional borrowing may affect future remortgaging or limit borrowing capacity.
- Market volatility: Falling property values could shrink equity and increase exposure.
- Long-term commitments: Stretching repayments over decades can increase total interest paid, even if monthly payments are lower.
Equity release is best suited to businesses and investors with clear strategies for repayment and growth.
Why Now? The 2025 Context
The case for secured borrowing is particularly strong in 2025. With rates higher than the historic lows of the last decade, unsecured credit is less attractive. Banks are also more selective, making traditional business loans harder to obtain.
At the same time, demand for growth capital remains high - whether for scaling operations, navigating competitive markets, or repositioning portfolios. In this environment, property-backed lending offers stability and access to capital when other sources are restricted.
The Role of Brokers in Unlocking Equity
While the potential is clear, navigating secured lending can be complex. Products vary, and terms differ significantly between lenders. Independent brokers, such as Willows Finance, can help businesses and investors compare options, negotiate favourable terms, and ensure borrowing strategies align with long-term goals.
By acting as an intermediary, brokers simplify the process and reduce the risk of entering into unsuitable arrangements.
Final Thoughts
Unlocking property equity is more than a financial tool - it’s a growth strategy. For businesses and investors, it can mean the difference between missing an opportunity and securing the capital to act decisively.
Used wisely, secured loans allow property assets to work harder, providing the liquidity needed to expand operations, diversify investments, or strengthen financial resilience.
In today’s high-cost environment, that flexibility can be the key to sustainable growth.
