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Asset finance and how to get existing assets refinanced

Asset finance and how to get existing assets refinanced

If you want to boost your cash flow by releasing cash against the value of your existing assets then refinancing could be the answer.

Three key reasons to refinance assets

1) Help reduce monthly payments
2) Assists cash flow by injecting capital into the business
3) Raise capital for purchase of other assets difficult to finance

Whatever you need to raise finance for - speed is crucial

In business today, circumstances can change quickly. Whether it's a key debtor who unexpectedly goes into liquidation or you see an opportunity too good to miss.

Having the cash to move fast and decisively is often the determining factor between success and failure.

An asset refinance plan can help you grow, take advantage of a situation or simply survive without ever getting your existing bankers involved. More importantly it can keep your existing credit lines free and the day-to-day business running smoothly. Unlike an overdraft, a refinancing package will run for the whole term agreed and cannot be called in. Enabling you to plan and manage your cash flow with confidence.

Asset refinance provides companies with a stable alternative to traditional bank lending

According to the Bank of England, high street bank lending for business has fallen every year since 2009. In 2012 lending dropped by almost 10%. With banks ever more reluctant to increase overdrafts or loan arrangements, businesses will find it incredibly difficult to grow. Which is why businesses have been searching for ways to release capital tied up in assets such as vehicles, machinery, or even buildings.

Asset refinance provides access to working capital that’s otherwise tied up on the business’ balance sheet.

The cash that asset refinance generates can be reinvested into further asset growth. Repayments to the asset finance company are made at a fixed monthly rate to aid the business’ sales ledger management. Asset refinance boosts a business’ cash flow by releasing cash against the value of a company’s existing assets. In addition to providing a timely cash flow boost, asset refinance also protects the business from asset depreciation.

Plan B financing – when the banks aren’t working for business

Andrew Cave from the Federation of Small Businesses told the BBC, referring to the commitments made by the UK's five biggest banks to lend more money to businesses.

"Talking to our members, 30% of them say they missed a growth opportunity because they weren't able to access finance at the right times, so there is still a problem."

Refinancing assets is more diverse than you may have first thought.

Asset refinance will release the money and capital that you have tied up in both assets such as machinery,  vehicles, plant , as well as buildings.  This money will help you to respond to today's business challenges. We have the flexibility to help you in almost all situations.

You can refinance almost any asset:

    • Commercial vehicles
    • Engineering machinery
    • Construction equipment
    • Buses & coaches
    • Miscellaneous plant
    • Audio visual equipment
    • Boats
    • Building equipment
    • Scaffolding, machinery, tools
    • Catering equipment
    • Equipment finance
    • Forestry equipment
    • IT equipment
    • Manufacturing machinery: Metalworking, Woodworking, CNC or conventional machinery
    • Packaging equipment
    • Plant machinery
    • Printing equipment
    • Recycling equipment
    • Vehicles: Vans, cars, buses, coaches, tractor and trailer units

You can even refinance existing leasing agreements as well as HP agreements

In these situations the refinancing settles the outstanding amounts with the original funder. It then spreads the cost of the refinanced asset over an agreed and more manageable period.  Freeing up this critical capital tied up assets can enable you to expand or restructure the business.

 

This article is by Gary Poulton, a Director or Redrock Commercial Finance. If you want to understand how to raise business finance quickly visit www.business-bridging-loan.co.uk


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