What loan amounts and repayment terms are typical for established solicitor practices?
Short answer: typical loan sizes and terms for law firms in the UK
Established solicitor practices in the UK typically access between £50,000 and £2,000,000 of business finance, with repayment terms ranging from 6 months to 7 years depending on facility type, security, and cash flow profile. Short-term facilities (e.g., VAT, tax, PII premium finance) run 3–12 months, while practice loans, partner capital loans, and secured term loans most commonly run 2–7 years. Revolving lines, WIP/disbursement funding, and invoice finance are usually 12–36 months in term but operate as ongoing facilities aligned to lock-up.
At-a-glance: common facilities, amount ranges and terms
| Funding type | Typical amounts (established firms) | Typical terms |
|---|---|---|
| Unsecured practice loans | £50k – £500k | 24 – 72 months |
| Secured term loans/refinance | £250k – £5m+ | 36 – 84 months |
| Revolving working capital lines | £100k – £2m | 12 – 36 months (renewable) |
| WIP/disbursement funding | £100k – £5m | 12 – 36 months (revolving) |
| Partner capital/profit-share loans | £25k – £500k per partner | 36 – 84 months |
| VAT & tax loans | £10k – £500k | 3 – 12 months |
| PII premium finance | £25k – £1m+ | 6 – 10 months |
| Asset/IT equipment finance | £5k – £500k | 24 – 60 months |
What drives the size and term a law firm can secure?
- Financial strength and stability: profitability over 2–3 years, partner drawings policy, and balance sheet resilience.
- Lock-up profile: WIP and debtor days by department, billing rigor, and recoverability trends.
- Practice mix and risk: litigation vs corporate/commercial, conveyancing exposure, legal aid dependence, and PII claims history.
- Security available: debentures over book debts, property, partner guarantees, or asset-backed collateral.
- Funding purpose and benefit life: growth, M&A, IT upgrades, premises, or bridging cash flow.
Funding types used by solicitor practices and the terms you can expect
Unsecured practice loans
Typical amounts and terms
Unsecured practice loans commonly fall between £50,000 and £500,000 for established firms, with 2–6 year repayment terms. These are used for growth, marketing, IT projects, small refurbishments, and cash flow smoothing. Lenders focus on EBITDA, partner stability, and consistent fee income.
Repayment structure and features
Repayments are typically monthly capital-and-interest with fixed or variable rates. Some lenders offer seasonal profiles to reflect fee cycles or allow partial early repayment without penalty. Personal guarantees may be required for LLPs and limited companies, depending on strength.
Secured term loans and refinance
Secured loans range from £250,000 to £5,000,000+ with 3–7 year terms, often used for acquisitions, larger refurbishments, or consolidating multiple facilities. Security can include a debenture, property charges, or cross-guarantees across group entities. Repayments are monthly; some structures include interest-only periods followed by amortisation to match investment benefits.
Revolving working capital lines (overdraft alternatives)
Revolving facilities of £100,000 to £2,000,000 are common for firms with seasonal billing or uneven receipts. Terms are often 12–36 months with annual review and renewal. Interest is paid on drawn funds, offering flexibility for managing lock-up and partner drawings timing.
WIP, disbursement and legal aid receivables finance
Specialist lenders fund recoverable WIP, disbursements, or legal aid claims with facilities between £100,000 and £5,000,000. Terms are typically 12–36 months, structured as revolving lines linked to verified case stages and expected recoveries. Pricing and advance rates reflect practice area mix, case duration, and historic recovery performance.
Partner capital and profit-share loans
Partner loans usually sit between £25,000 and £500,000 per partner with 3–7 year terms. They support buy-ins, capital contributions, or to rebalance drawings during growth. Repayment can be matched to partner profit distributions; lenders consider individual credit, partnership agreements, and firm stability.
Tax and VAT loans
VAT and corporation tax loans range from £10,000 to £500,000 with 3–12 month terms, helping firms spread lump-sum outflows. Many lenders fund on a quarterly or annual cycle aligned to HMRC deadlines. Repayments are monthly and often fixed, aiding cash flow predictability.
Professional Indemnity Insurance (PII) premium finance
PII premium finance for solicitors commonly funds £25,000 to £1,000,000+ over 6–10 months. Facilities are designed to match renewal cycles and reduce the strain of hefty annual premiums. Lenders look at claims history, practice area risk and the insurer’s terms.
Asset and IT equipment finance
Asset finance facilities start at £5,000 and can exceed £500,000 for servers, case management systems, and office fit-outs. Terms are typically 2–5 years, with hire purchase or lease options. Repayment often matches asset life, preserving working capital for operations.
Example scenarios: how amounts and terms look in practice
High-street mixed practice (10 fee earners)
A 10-fee-earner firm with conveyancing, family and private client work might secure an unsecured practice loan of £150,000 over 48 months for IT upgrades and marketing. A £250,000 revolving line could help manage seasonal completions and PI disbursements. VAT loans of £40,000 over 6 months may be used periodically to smooth cash flow.
Regional litigation boutique (25 fee earners)
A litigation-led firm with longer case cycles could use a £1,000,000 WIP/disbursement facility over 24 months (revolving) to bridge case expenses and counsel fees. A partner capital facility of £300,000 per partner over 60 months could support expansion and new lateral hires. If acquiring a small team, a secured term loan of £1,500,000 over 72 months may be appropriate.
Corporate/commercial firm (50 fee earners)
A corporate-focused LLP may hold a £2,000,000 revolving line for working capital over a 36-month term with annual review. For premises modernisation, a £750,000 asset/fit-out finance over 60 months spreads cost. Profit distribution alignment could be managed via partner loans of £200,000 per partner over 48 months.
Choosing the right term and structure for your firm
Align term to benefit life and cash flow
Match the repayment period to the life of the asset or initiative. Short-term liabilities (VAT, PII) suit 3–12 months; IT upgrades or refits usually suit 36–60 months. For ongoing working capital needs, a revolving line or WIP facility may be more appropriate than a term loan.
Quick affordability sense-check (non-advice)
- Identify purpose and benefit life: cash flow, asset, or growth.
- Estimate the monthly repayment and compare to average monthly EBITDA and cash headroom.
- Stress test for slower recoveries: extend lock-up assumptions by 10–20% and check coverage.
- Consider partner drawings flexibility to preserve covenant headroom.
Documents lenders often request
- Last 2–3 years’ statutory accounts and latest management accounts with aged WIP/debtors.
- 12-month cash flow forecast and commentary on lock-up management.
- PII schedule, claims history, and practice area breakdown.
- Partner/ownership structure, capital policy, and drawings history.
- Details of existing facilities and security positions.
For a deeper overview of options specific to the legal sector, explore our dedicated page on solicitors business finance here: Solicitors loans and funding options.
How Best Business Loans can help (we’re an introducer, not a lender)
We use AI-driven matching to introduce your firm to lenders and brokers familiar with legal sector funding. You can request a Quick Quote, Decision in Principle or Eligibility check in minutes, with no obligation to proceed. We’ll connect you with providers that understand solicitor cash cycles, lock-up, PII, and compliance.
FAQs: solicitor practice finance amounts and terms
How much can an established law firm borrow without property security?
Unsecured practice loans for established firms commonly range £50,000 to £500,000 over 2–6 years. Larger unsecured lines may be possible for highly profitable firms with strong lock-up control. Where required, lenders may request partner guarantees to support the facility.
What repayment terms are typical for partner capital loans?
Most partner capital or profit-share loans run 3–7 years, with monthly repayments aligned to distributions. Amounts typically range £25,000 to £500,000 per partner, depending on seniority and contribution. Terms are set to avoid undue strain on firm cash flow and partner drawings.
How long are WIP/disbursement finance facilities?
These are often 12–36 months and structured as revolving lines tied to case recoverability. Lenders review performance at least annually and can flex limits as the practice scales. Draws and repayments ebb with case milestones and settlements.
What’s a sensible term for IT systems and office refits?
Asset and fit-out finance usually runs 2–5 years to reflect the useful life of the investment. Matching term to benefit helps avoid overpaying interest or refinancing too soon. Many firms choose 48–60 months for larger transformation programmes.
How quickly can VAT or tax loans be repaid?
VAT and corporation tax facilities generally run 3–12 months with fixed monthly repayments. They allow firms to preserve working capital while meeting HMRC deadlines on time. Rolling use each period is common where cash flow is predictable and well-managed.
Will a revolving line tie us in for years?
Revolving working capital lines are typically agreed for 12–36 months with annual review and potential renewal. You pay interest on the funds you draw, not the undrawn limit. Many firms maintain these lines over multiple cycles for flexibility.
Can mid-sized firms access £1m+ facilities?
Yes, where financials are strong and security or asset coverage is available, £1,000,000+ can be accessible. Litigation, corporate and PI-heavy practices often deploy larger lines due to case values and disbursement needs. Lenders evaluate profitability, lock-up, and recovery history to size the facility.
Will terms be shorter if our debtor days are high?
Potentially, as elevated lock-up can reduce affordability and increase risk. Lenders may propose smaller limits, shorter terms, or require lock-up improvement plans. Demonstrating billing discipline and proactive collections strengthens your case.
Key takeaways
- Most established solicitor practices borrow between £50,000 and £2,000,000, with terms from 6 months to 7 years depending on facility type.
- Short-term needs (VAT, PII, tax) suit 3–12 months; growth and assets fit 24–60 months; secured term loans commonly run 36–84 months.
- Revolving lines and WIP/disbursement funding are typically 12–36 months and renew with performance reviews.
- Eligibility and sizing hinge on profitability, lock-up, practice risk mix, and security available.
- Best Business Loans can introduce your firm to UK lenders and brokers that specialise in funding law firms.
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