Depending on the business cash flow loan selected, you may or may not have to put up collateral to receive working capital funding. Unlike unsecured loans, typically, secured loans require collateral, holding you personally responsible if you fail to repay and default on the loan. Specific financing types, such as secured loans, often command significant attention due to the potential for a prepayment penalty and the requirement for collateral. These collateral requirements can vary based on the specific financing type chosen, making it crucial to fully understand each option. Always ask your cash flow lender key questions about prepayment penalties and other aspects before applying. Additionally, short-term loans, which bear close similarity to traditional loans but lighter repayment schedules, might demand either a personal guarantee or physical assets as collateral to secure the loan, although these too may come with a prepayment penalty. At the same time, invoice financing and advancing methods products offered use future sales as security.