If your business owns real estate, you may already have access to significant financing without selling the asset and without waiting months for a bank credit committee to reach a decision.
A business loan secured by real estate lets you borrow against the value of property you own. The property stays in your ownership. You receive the capital. And compared to a conventional bank loan, the process is faster and the eligibility criteria are different — which matters when your collateral is solid but your business profile does not fit standard bank templates.
Most businesses that use this route are not property developers. They could be a vehicle rental firm, a retail operator, or any other business that happens to own real estate and has equity available to put to work.
You don’t need to be a property developer
The most common misconception about real estate-backed business loans is that they are only for developers building apartments or commercial projects. They are not.
Any business that owns real estate with sufficient equity can use it as collateral, regardless of what the business actually does. A car rental firm can use an apartment it owns to secure working capital. A retailer can borrow against a commercial unit to fund inventory or expansion.
The loan proceeds do not have to be spent on anything related to the property. The collateral and the loan purpose are separate. What matters is the value of the property, the resulting loan-to-value ratio, and the borrower’s ability to service the debt.
What types of property qualify as collateral?
The property used as collateral does not have to be the premises your business operates from. It can be a rental property, an investment asset, or any other real estate with sufficient equity and clear legal ownership.
| Property type | Eligible | Notes |
| Residential apartment | Yes | Can be owned by the business or its controlling shareholder |
| Commercial premises (office, retail) | Yes | Clean title required; no unresolved encumbrances |
| Warehouse / industrial unit | Yes | Appraisal driven by location and condition |
| Serviced land | Case by case | Building permit status and infrastructure access matter |
| Mixed-use property | Yes | Assessed on predominant use |
| Property under active construction | Case by case | May qualify for a development loan instead |
The maximum LTV across Estateguru’s loan products is 75%. The specific ratio for any application depends on the property type, location, condition, and borrower profile and is determined by independent appraisal.
LTV (loan-to-value ratio) is the loan amount expressed as a percentage of the property’s appraised market value. A property worth €100,000 at 75% LTV would support a maximum loan of €75,000.
What can the loan be used for?
A real estate-secured business loan is flexible by design. Common uses include:
- Working capital — covering operational costs, supplier payments, or seasonal shortfalls in cash flow
- Equipment or machinery — purchasing assets needed to operate or grow
- Business expansion — opening a new location, entering a new market, or scaling the team
- Refinancing — replacing more expensive or less flexible existing debt with a secured loan
- Bridge financing — covering a cash flow gap between income cycles, contract milestones, or the sale of an asset
The collateral and the loan purpose do not have to be related. What matters is the collateral — not how the capital is deployed.
How the process works — and how long it takes
Applying for a real estate-backed business loan through Estateguru follows four stages:
- Initial inquiry — Submit your loan request online. A loan manager will review it and contact you within two to three business days.
- Collateral appraisal — The property is independently valued. This establishes its market value and determines the maximum loan amount available.
- Credit committee review — The application, collateral appraisal, and borrower profile are reviewed internally. This stage includes the borrower’s financial documentation and business plan.
- Funding — Once approved, the loan is funded by investors on the platform. Capital can reach the borrower’s account within days of the approval decision.
For projects financed in stages, borrowers pay interest only on the amount that has actually been disbursed. For example, if a €300,000 development loan is structured in several tranches and only the first €50,000 has been released, interest is charged only on that €50,000. Unlike many bank facilities, borrowers do not pay interest on funds that have been approved but not yet drawn down.
There are also no early repayment penalties.
For context: a bank loan against the same collateral might take several weeks to several months from application to drawdown and may not be available at all if the collateral is a development-stage asset or if the business profile falls outside standard credit criteria. For more detail on how a real estate-backed loan compares with bank financing, see our guide: Property-backed business loan: secured financing that moves faster than a bank →
Real example: a business owner uses an apartment to fund his rental company
The following case from Estateguru’s portfolio illustrates what this looks like in practice.
The borrower was a small business owner with two companies in the vehicle and light commercial vehicle rental sector. He also owned a 95 m² studio apartment (a well-equipped space used for short-term stays and events) which he rented out separately.
He was not a property developer. He had no construction projects. He simply needed €74,000 to strengthen the working capital of his rental business.
The apartment was used as collateral. After an independent appraisal, the loan-to-value ratio came to 64.9%. The loan was structured as a bullet loan — 18 months, with quarterly interest payments. The apartment had nothing to do with the vehicle rental business. It was an asset with equity, and that equity became working capital.
The key takeaway: the property and the loan purpose were completely unrelated. The business owner held a property with value, identified a business need, and used one to address the other.
Is a property-backed business loan right for you?
| Your situation | What to consider |
| You own property with meaningful equity | A property-backed business loan is worth exploring |
| You need capital faster than a bank can provide | A property-backed business loan can move in days, not months |
| Your business doesn’t fit standard bank templates | Non-bank lenders assess collateral quality, not just business profile |
| You want to compare all real estate financing options first | Full guide: real estate financing for businesses in Baltics → |
| Your project is development-stage construction | A development or bridge loan may be more appropriate — see our product page |
A property-backed business loan is not right for every situation. If the collateral has unresolved legal encumbrances, if the LTV required exceeds what the property can support, or if the business has no realistic path to repayment, this route will not be available. As with any secured financing, the property can be at risk if the loan is not repaid.
How to apply with Estateguru
Estateguru offers business loans secured by real estate across the Baltics. The product is available to companies and to business owners who can provide qualifying collateral.
Loan amounts start from €20,000. LTV up to 75%. No early repayment penalties.
To apply, submit a loan inquiry via the borrower page. A loan manager will review your inquiry and respond within two to three business days.
Frequently asked questions
Can I use residential property I own personally as collateral for a business loan? No, the collateral must be owned by the business itself, not by the owner personally. A property held in your personal name cannot be pledged directly against a company loan; it would need to be owned by the business (or transferred into the company’s ownership) before it can serve as collateral. Speak to a loan manager about your specific ownership structure before applying.
Does the collateral property have to be in Latvia? Estateguru primarily finances projects and borrowers in Estonia, Latvia, and Lithuania. If your collateral is located in one of these markets, it can generally be assessed. Properties outside these markets are not typically accepted as collateral.
What LTV can I get? LTV varies depending on the property type, location, condition, and borrower profile. For most property types, the maximum is 70–75%. An independent appraisal determines the market value, and the maximum loan amount follows from that.
How quickly can I receive funds after approval? Once the loan is approved by the credit committee and listed on the platform, funding by investors can happen within days. The total time from inquiry to funding depends on how quickly documentation is completed, typically a few weeks for a straightforward application.
What happens if I cannot repay the loan? A real estate-secured loan is a secured obligation. If the borrower defaults, the lender has the right to enforce the mortgage and recover the outstanding balance from the proceeds of the property. Estateguru’s loan managers work with borrowers to find solutions before enforcement, but borrowers should understand the collateral risk before applying.
