As a business owner, you’re always on the lookout for new and exciting ways to grow and expand. You can’t afford to sit back and coast, not with competitors vying to overtake you, so it’s vital you have all the resources at your disposal. That’s where Asset Finance can help.
A specialist business finance package, Asset Finance contains a wide variety of products that can be used to borrow, purchase or even refinance the assets (equipment, machinery, vehicles or property) that you already own. So if the key to your business’ success depends on new high-quality equipment or access to additional funds, Asset Finance could introduce you to a variety of finance solutions that will reinforce and enhance your ability to grow.
Can my business apply for Asset Finance?
Whether your business needs specialist equipment, heavy machinery, vehicles or even just to release equity, Asset Finance could be the package you’re looking for. Whether you’re a startup, SME or an establish firm, Asset Finance is available to all UK businesses, regardless of which sector you’re in. Yet, in spite of the many benefits that are on offer, many UK business owners don’t know how it works and what it can achieve. This is unfortunate since Asset Finance can prove an invaluable pathway to explore, especially if you’ve tried other, more traditional, funding options but were rejected or are seeking to use other asset acquisition methods.
What Asset Finance solutions can I apply for?
What makes Assets Finance such a useful package for any business is the variety of solutions that it allows you to work with. Whether you aim to purchase, lease or unlock the equity contained in the assets that you already own, applying for Asset Finance may provide you with the means to do so in complete confidence. This includes Secured business finance solutions such as Hire Purchase, Leasing and Asset Refinance.
If you lack sufficient capital to purchase an asset outright, Hire Purchase is a useful alternative. With Hire Purchase, you could set up an agreement to eventually gain ownership of the asset in question. It works by the lender purchasing the asset on your behalf from a supplier, and the asset itself is used as collateral. But before you can begin making full use of the asset, you’ll first need to make an initial deposit. This is usually about 10% of the asset’s total asking price (including VAT), but is subject to negotiation so can vary.
Once the initial deposit has been settled, you’ll be able to make full use of the asset in your business’ day-to-day operations, providing you keep up with the repayment scheme. Hire Purchase Agreements can last up to 5 years, during which you’ll need to make Fixed Monthly Repayments, plus interest. Once the agreement has been fully repaid, ownership of the asset is transferred to you.
If your business needs access to a particular asset for a limited time only, or one that quickly depreciates, borrowing the asset that your business requires might be more appropriate. Leasing agreement usually last 5 years, but if the asset is particularly expensive some lenders may allow you to extend to 7 years. During this time, you’ll need to make Fixed Monthly Rental Payments, which take into account the asset’s purchase price and it’s predicted worth once the agreement ends. You may also be responsible for maintaining the asset and setting a up an appropriate insurance policy.
Depending on the type of lease you choose (eg. Finance Lease, Contract Hire), you can either return the asset, extend the term or upgrade to another model at the end of the agreement.
Another product you may want to consider if you’re looking to raise capital is Asset Refinance. This allows you to release the equity tied up inside one or more of your business’ unencumbered assets (equipment, machinery or vehicles), but temporally transfers ownership of the asset to the lender. Nevertheless, you’ll still have full access to the asset, providing you keep up with the repayment scheme. Plus, the funds that you could acquire using this method usually have few or no usage restrictions attached.
This means that you can use Asset Refinance for any number purposes in and around your business, including growth. Whilst the agreement is in operation you’ll be required to keep up with a Fixed Monthly Repayment Scheme which typically lasts up to 5 years. As soon as the agreement has matured, with all relevant repayments met, you regain control of the asset.
What does this all mean for my business?
With the products on offer, Asset Finance provides you with the means to grow and enhance your business in any way possible. So if success hinges on acquiring additional equipment, replacing out of date machinery, acquiring business vehicles or using equity to support growth projects, applying for Asset Finance could offer you all the support you need to drive your business forward and achieve a strong, sustainable future.
However, to be certain that you’re choosing the most appropriate and cost-effective solution, speaking with a qualified business finance professional may prove invaluable.
Thinking about applying for Asset Finance?
No matter which sector you operate in, businesses often rely on assets to simply operate. However, acquiring them can be expensive and can easily push you into financial difficulty. But there is another way. Asset Finance could enable you to obtain all the tools and equipment you need to not only maintain your business’ operations, but expand them as well.