Senior debt is provided by banks usually on an asset basis. It is the most senior layer of capital and is secured by the assets and a personal guarantee. Due to its low risk, it is the lowest priced layer in the 3-layer cake and is generally at prime plus or minus a small spread. It is short-term money and generally is due in less than 3 years. Banks are generally risk averse and do not have the same risk/reward profile as a business owner. As a result, it is best used for short-term needs where the risk of non-repayment is quite low.