Finance for SolicitorsSpeak to one of our experts020 4525 5312
Funding your practice
- Tax loans
- Practice loans
- Training costs
- Lending for professional indemnity cover
- Deal with disbursements
- Deal with aged debt
- Support during long cases
- Asset finance from 6%
- Hire Purchase
- Lease solutions
- Provide premisies
As a lawyer, you are running a business, and finding the most appropriate finance is essential for your profitability.
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In the United Kingdom the profession of the law is growing at an increasing pace. According to the Law Society, there are around four times the numbers the legal profession as there were 40 years ago. That means both increased opportunity, and increased competition.
Of course, as with every other business, if you are to seize the opportunities and outperform your competitors you must be able to call on adequate funding.
However, as a Solicitor or Barrister, your funding needs may be beyond the scope of general lenders. The nature of the legal profession means that specialised lenders may be required.
At Rangewell, whether you are a sole practitioner or a partner in a large multi-partner firm, we know the lenders which are ready to provide the lending you need.
Understanding your funding options
The right type of funding option can help you with:
- Cashflow - funding for long cases
- Aged Debt Funding
- Disbursement Funding
- Insurance for Professional Indemnity
- Purchasing office equipment and computer hardware
- Funding for tax and VAT
- Funding your premises
- Acquisitions, mergers, buy-ins/buyouts
The challenges you may face:
Getting cashflow running smoothly is a challenge for every business. In the legal profession, the problem may be particularly acute when you must wait for payments on major cases that can stretch on for months.
Issues with aged debt and disbursements can mean a drain on your reserves, while simply providing operating funds during a long and complex case may cause issues.
At Rangewell we can provide a number of funding types which can offer solutions to cash flow challenges.
Revolving Credit Facilities
An overdraft used to be the simple solution for businesses but, even for legal professionals, overdrafts may now be very difficult to arrange. Many banks simply cannot provide the level of funding you need under their lending rules.
Revolving Credit Facilities may be a versatile alternative. They provide a line of credit, with an agreed limit that you can call on when you need it. You only pay for the money you take out, so it can be a cost-effective way to raise funds if you need them.
Find out more about Revolving Credit Facilities.
Working Capital Finance
Working Capital Finance is another solution. This is a loan used to provide cash to pay staff and suppliers while awaiting payments. It is usually designed to be repaid in the short- to medium-term, once the practice is fully on its feet.
Find out more about Working Capital Finance.
If you are burdened with significant aged debt, you might want to consider an unsecured business loan, which will enable you to deal with the problem on a schedule that you set yourself.
Find out more about Unsecured Business Loans.
Insurance for Professional indemnity
Your professional indemnity insurance may be a major expense, particularly if you work in sectors such as the corporate commercial sector, where liabilities may potentially reach into the millions. There are a number of ways to provide for the costs. A short-term loan may be one of the simplest solutions when your policy requires renewal.
Find out more about short-term lending.
Office equipment and computer hardware
Your office and the efficiency of your entire business will depend on having the right equipment. The right computing hardware and software has become central to almost every activity, and your hardware, software and network will all be major costs.
The list of equipment you need will not stop there. You will also need to furnish your office, and you may need to provide vehicles.
Asset Funding may provide the most cost-effective solution for most of your equipment needs. There are several types of Asset Funding for you to consider. You may prefer Hire Purchase for items that you wish to keep, such as desks, chairs and document storage. Leasing may be more appropriate for such things as your IT, as it will allow you to update to the latest and most reliable technology whenever you need it. Contract Hire is another option and might help you reduce the costs of providing vehicles for your business.
At Rangewell we can help you find the most appropriate Asset Funding solutions for your needs.
Getting the right type of loans for particular business needs
At Rangewell, we work with lenders across the UK market and can help you secure the most competitive Secured and Unsecured business loans.
There are two main types of business loans:
- Secured Loans are ‘secured’ because you need to provide security which the lender will take if you cannot pay the loan back. This could be your home or even your business premises. They can be used to borrow large sums of money, often of £250,000 or more.
- Unsecured Loans can be suitable for smaller sums from £5000 upwards, although it's worth noting that some lenders will not let you borrow more than one month’s turnover with an unsecured loan.
We can help you find the kind of loan that is most appropriate for your circumstances.
We can also help with a number of specialised loan products:
Planning ahead for your tax liabilities is part of good company management, but a large quarterly VAT or annual tax demand can still cause problems with your cash flow, particularly it falls at the same time as other costs. Tax Loan facilities can help you to spread the cost of your tax demands into affordable monthly payments.
- Better control of cash flow
- Fixed monthly payments
- Quick and simple to arrange
- Avoids issues with HMRC, potential penalties and professional liabilities
As a legal professional you have a special status, and represent an excellent prospect for lenders. A practice loan recognises this special status, and may allow you to arrange an unsecured loan at an exceptionally low rate. The funds may be used for virtually any business purpose, including equipment, property, or tax liabilities.
Contact us to find out more about Practice Loans.
If you are relatively new to the profession may wish to buy into an existing legal practice as a partner, or even buy it outright.
If you already own an established practice, you might want to consider acquisitions, mergers or expansion. However, the costs involved may be substantial.
We can help you secure a number of solutions to let you buy into an established practice, including a Partner Equity Loan. This can take the form of an interest-only loan with a term of up to 25 years, which can be the most appropriate way to buy into a practice.
Contact us to find out more about Partner Equity loans.
Other solutions can include secured loans - with the security provided by assets such as property, or even the practice itself.
Find out more about solutions for funding buy-ins or buyouts.
Large-scale finance can be vital if you have major plans such as acquiring a competitor. Growth Finance may be the most cost-effective way to get the help you need. Lenders may require an established trading history and record of profits, but it may be possible to arrange Growth Finance based on your profit projections, rather than on your trading history.
Get our help finding the most appropriate lending for your needs.
Funding your premises
Premises can represent a major investment for any business. The cost of renting a suitable office will depend on your location, and the square footage you need - it may be best to take on more space than might be strictly necessary to allow you to take on staff or partners in the future. There may be service charges and business rates on top of the bare lease. You may need upfront funding to secure the agreement - we can provide a number of solutions to help you.
However, renting means ongoing costs, and puts your practice at risk of rent increases. Buying your premises with a Commercial Mortgage may often actually decrease your monthly outgoings and provide you with a valuable asset for the future. Commercial Mortgages operate much like a residential mortgage but are secured on commercial property and arranged on an individual basis. As a lawyer, your professional status could help you secure a particularly competitive deal.
You can also use a Commercial Mortgage to provide finance for other business needs. By taking a mortgage on premises you already own, in effect using them as security for a loan, you may, for example, be able to raise sufficient funds to acquire another practice.
Find out more about a Commercial Mortgage.
How we help you capitalise your legal practice
At Rangewell, our expertise works to bring you the financial solutions you need to capitalise your business, whether you want to fund capital expenses, working capital or growth.
We know the lenders who can offer the most competitive rates for the legal profession, and as well as conventional loan products, we can help you find Alternative Funding, using new loan providers and innovative funding solutions.
Whether you have a straightforward finance need or require a complicated ‘Jigsaw’ funding plan made up of a combination of products, we can work with you to find the answers that are right for your needs. Call us now to get our experts working for you and your practice.
Last update: 26 July 2022
Download Rangewell’s free and detailed guide to Finance for the Legal Profession
What types of finance are there - which do you need?
Why not all providers are equal - finding the one that’s right for you
How we can provide an additional income stream
The downsides to finance - and how to avoid them
How to arrange finance - what paperwork do you need?