5 Simple Steps to Asset Finance for Businesses
A business cannot survive, let alone thrive in absence of adequate equipment to facilitate and streamline the day-to-day operations. Nowadays, even a home-grown business needs
Business loans can offer support for expanding your business and growing your profits. However, as your business evolves, you may want to explore new loan terms that fit your situation better than an older arrangement. Often, business owners opt for quick business loans to manage urgent expenditures. Later, when the business circumstances change, they want to switch to different loan contracts to reflect their new positions. Business loan refinancing can often help you achieve these changes! Let’s analyse how business loan refinancing works and what you need to know.
Refinancing involves getting a new debt facility to pay off your current business loan. This process allows you to transition into a more favourable loan arrangement. After servicing your existing debt for some time, you can explore new loan contracts with your current lender or a new one.
Refinancing, when pursued in the correct context, can help you unlock excellent business benefits. Here are some benefits that you can leverage by refinancing your loan.
Even though refinancing offers many benefits, it is crucial to analyse this choice carefully before finalising a new agreement. These two questions can help you make an informed choice.
Every business scenario is unique and the benefits you get from refinancing will depend on your situation. Your business loan may need refinancing if your business has changed considerably since you got your loan. If the size, scale, or income has grown significantly, it makes sense to look for refinancing options.
Moreover, you may need refinancing options if your current debt arrangements are too complicated. Debt consolidation can benefit your business by freeing up resources and streamlining your loan management. Finally, if you get lower rates and better value, you can consider refinancing.
Refinancing often involves substantial costs in the form of fees. These include application charges, discharge fees, valuation and settlement fees. You may also need to pay break costs if you transition from a fixed-rate loan before the stipulated period. Analyse all these costs and evaluate how they stack up against the benefits.
You can connect with an expert broker from Broc Finance to assess your options and learn more!
Saroj is the Head of Lending at Broc Finance. He comes with 13+ years of experience in small business lending and has a knack of structuring complex deals and get the best outcome for his customers.
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