How to apply for Asset RefinancingPublished on 8th November 2017 2017-11-08T14:49:59+00:00 - Last update on 1st April 2020 2020-04-01T11:42:29+00:00
If your business contains valuable assets, such as equipment, machinery or property, Asset Refinancing could be a great choice if you’re needing a capital injection. Differing from general refinancing - or consolidation - Asset Refinance relies on releasing money from a business' own assets. Gaining reliable access to funding has always been a necessity when it comes to your business’ growth and development, but can it can also be hard to come by. Yet sometimes, the answer to your funding issues could be lying right under your nose. If your business is in possession of high-value assets that have a slow depreciation rate, you could borrow a lump sum by using an Asset Refinance solution to support and develop any area of your business. If you feel that your business could benefit, here’s what you need to apply for an Asset Refinance solution:
- Unencumbered business assets
- Credit Profile
- Personal Guarantee
What assets can I refinance?
To apply for Asset Refinance, your business must contain highly valuable business assets which have a slow depreciation rate. They must also be unencumbered, meaning that you need to own the asset put forward outright without it being subject to any existing finance arrangements. Such assets can range from cars, vans and machinery to technology and property (residential or commercial).
When you do choose to apply to refinance current assets, you’ll also need to disclose information about the asset. This will include the make and model of the asset put forward, its manufacture date, the date when it was purchased and how much usage it has experienced. A qualified surveyor will also conduct an evaluation based on the asset’s condition and resale worth. Since Asset Refinance is a secured business finance solution, a lender can seize the asset in question should your business become unable to repay the finance agreement.
Will I need to show my credit profile?
Yes, although it generally isn’t used to as a reason to decline your application. Lenders will request to review your business’ credit score as this will help determine the rate of interest that you’re offered. Business lenders usually have a range of interest rates, and which your business is presented with will depend on how strong/weak your credit score is.
Is a Personal Guarantee required?
Some lenders may ask you, or any associated business partners, to provide a Personal Guarantee. This is a verbal or written agreement expressing your commitment to repaying the finance product on time, giving lenders confidence when dispensing large lump sums to your business. In addition, lenders may impose clauses that may give them the ability to pursue you personally through the courts if your business fails to repay the product.
Thinking about refinancing your business assets?
Sourcing the most appropriate business finance solutions can be a tiring and painstaking process, taking you away from your core business. Nevertheless, you need a product that can provide the right amount of funding to support your business’ needs, combined with a competitive interest rate to match. This is why an increasing number of business owners are choosing to fund their business using Asset Refinance. By applying for an Asset Refinance solution with Rangewell you could release the cash tied up in valuable assets to fund any number of business projects, bolstering growth and reinforcing long-term sustainability. If your business contains valuable assets that you’re able to put up as security, apply for a secured Asset Refinance agreement today, or find out more with Rangewell.
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