Questions to ask when considering Asset Refinance

Published on 27th September 2017 - Last update on 19th November 2019

Choosing a business finance product for your business can be one of the most daunting and complex decisions you’ll ever have to make. With your business’ growth and sustainability at stake, applying for the most suitable finance product is essential. But if your business contains valuable unencumbered assets such as equipment, machinery, vehicles or property, Asset refinance can offer you the help and support your business needs. Asset Refinance is an increasingly popular way of releasing equity in the assets that you own in order to fund your business. However, before committing to any finance obligations, you need to consider your options carefully. So before applying for Asset Refinance, you need to know:  

  • What is Asset Refinance?
  • How much money do I need?
  • Which assets can I present?
  • Are there additional charges?

How does Asset Refinance work?

Asset Refinance is a secured business finance product that allows you to borrow a lump sum based on the equity contained in any asset that you present as part of the agreement. It works by the lender providing you with a lump sum in exchange for temporary ownership of the asset, whilst still allowing you to make of it in your day-to-day operations. Once the funds have been deposited into your business account you can use to grow, support and bolster any aspect of your business, including renovations, refurbishments, extensions, equipment purchases, cash flow and so on.

Asset Refinance is also gradually repaid over a term that can extend up to 5 years using a Fixed Monthly Repayment scheme. This means that you’ll be expected to repay a set sum at the end of each month that takes into account the amount borrowed, the length of the term and interest. However, if you fall behind or become unable to complete the repayment process lenders can remove these assets from your business in order to recover the outstanding sums that they’re owed.

In need of a large lump sum? Got valuable business assets? Apply and unlock the cash contained in your business’ assets today, or learn more about Asset Refinance can help your business!

How much cash can I release?

Asset Refinance allows to you release a lump sum to your business on the equity contained in the asset that you present to a lender as part of the agreement. As such, there isn’t a limit to how much money you could receive to fund your business’ development. But in order for lenders to provide you with a lump sum, you must first provide them with details such as the type of asset that been put forward, its make and model, proof and date of purchase, usage as well as its current condition. In order to work out the asset’s estimated resale worth, a qualified surveyor will inspect and carry out a valuation.

What assets qualify for Asset Refinance?

Assets that can be accepted to form Asset Refinance agreement can range from specialist equipment, heavy machinery, business vehicles and property (residential or commercial). These assets must also be unencumbered, meaning that you own them outright and they aren’t subject to any ongoing finance commitments. In addition, these assets mustn’t be vital or fixed into the structure of your work premises, meaning that it’s possible for them to be removed, if necessary.  

Are there any additional charges?

As well as interest it’s possible that you may be confronted by additional charges by lenders, some of which must be paid before an agreement can begin. Some these potential charges could involve: setup, administration, legal, surveyor and exit fees, to name just a few. So before entering any Asset Refinance agreements, ask lenders about what other charges or costs may apply. Collecting information from a range of lenders regarding additional charges, you use it during negotiations to reduce or even negate any potential fees from your chosen lender.

Thinking of applying for Asset Refinance?

It’s not easy sourcing the most appropriate form of finance for your business on your own, but if your business owns sufficient assets you could apply for Asset Refinance. The other challenge to consider is which lender to apply for agreement with. Thanks to the alternative finance industry, there are now more products and lenders to choose from than ever before, making it easy to get lost and confused. However, you’re not alone. Help is at hand. If you believe Asset Refinancing is suitable for your business apply for an agreement today, or find out more with Rangewell.


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David Harrison

David Harrison

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