What is business asset finance?

Business Asset Finance is an agreement that enables businesses to obtain the assets needed to manage and/or expand effectively and spread the cost/outlay. So when you need to purchase assets for your business, asset finance wont disrupt your cashflow.

Should my business consider this?

You can use your company’s balance sheet assets, such as investments or inventory as security to borrow money or take out a loan against an asset you already own.

It can provide a secure and easy way of getting working capital for your business. Regardless of the size of business, the decision to invest in assets is always difficult. However, take a look at some of the benefits:

  • A great alternative to a traditional bank loan
  • Increased tax benefits
  • Payments can be budgeted according to cash flow
  • Lenders secure against the asset.

Carpenter Box can advise:

There are a number of options available to consider with a couple listed below. However please do talk to us, as we can advise the best option for your business.

  • Hire Purchase – allows you to buy an asset and pay for it over a period of time, spreading the cost via an agreement with a finance company. An initial deposit is payable; and
  • Finance Lease – a rental agreement through which an asset can be obtained for a fixed term. At the end of the initial term, the agreement can be extended, or sold with a rebate of the sale proceeds to the client.

Does my company have to offer security?

Asset financing refers to the use of a company’s balance sheet assets, including short-term investments, inventory and accounts receivable, to borrow money or get a loan. The company borrowing the funds must provide the lender with a security interest in the assets.

What do I need to do?

You will need to ensure your management accounts are up to date, you have current detailed lists of debtors and creditors and all assets, and you might need up to date projections before a lender will consider your application.

Talk to us

Please do talk to us about finance. At Carpenter Box we have many years of experience and success in advising business across a wide range of sectors in obtaining working capital finance solutions.

Robert Lee