What is Asset Finance?
Businesses that need to invest in new or replacement equipment, but don’t want to have to let go of a lot of funds upfront, can benefit from asset finance. It allows more freedom to manage cash flow and available resources. Choosing a finance agreement gives you the advantage of being able to invest in assets to promote business growth and expansion that your firm might not otherwise be able to afford.
Asset financing presents a compelling alternative to locking up valuable cash that may be put to better use elsewhere. Additionally, it enhances cash flow and spreads out costs. Access to new equipment or technology may enable the company to grow, create new services, or improve efficiency.
Having the right equipment and asset finance can help save you time and money to invest in growing your business. You can also reduce the risk of owning obsolete equipment, and there can be various tax outcomes too.
Peel Finance Brokers: Your Asset Finance Experts
Peel Finance Brokers considers all manner of assets for finance, from vehicles for commercial and personal use to heavy machinery and shop fit-outs. We finance equipment such as furniture and technology for offices, medical institutions, retail shops, warehouses and factories.
When considering asset finance options, ask yourself:
- How much capital do I need to grow my business?
- When do I need to smooth the bumps in my cash flow?
- What are the tax outcomes of asset financing?
- How long will I need the equipment, and will I need to upgrade it?
- Is technology rapidly changing in my industry?
- Do I want to ‘finance to own’ or ‘finance to return’ my asset?
Asset finance options include:
→ Commercial Hire Purchases
→ Financial and Operating Leases
→ Chattel Mortgages
→ Technology Rentals.
Each is suited to different commercial circumstances, so when considering your options, you may want to talk to your accountant or tax adviser.
FAQ
What does asset finance mean?
Asset financing is the practice of borrowing money or receiving a loan using the assets listed on a company’s balance sheet. This includes short-term investments, inventory, and accounts receivable. A security interest in the assets must be given to the lender by the business borrowing the money.
What are the various types of asset finance?
The five specific types of asset financing include: hire purchase, operating and financial leases, equipment leases, and asset refinance.
What are the advantages of asset finance?
Asset financing can assist firms in deferring the cost of purchasing or leasing machinery, automobiles, and other items over time. This may allow you to free up operating cash, get necessary equipment that your company cannot afford to purchase outright, or just spread the cost over a longer period of time.
How does asset financing operate?
Asset financing is a choice companies can make to expand by purchasing desperately needed equipment, such as fleets of cars, farm gear, and even aeroplanes. In essence, instead of paying the full price to buy the asset altogether, you pay a recurring sum to use it over a predetermined length of time.
Is asset finance considered a loan?
Yes. A loan secured by a company’s assets, such as equipment, machinery, and other physical property, is known as asset finance. Bank loans only consider your present financial status and cash flow when determining your eligibility. All of your other debt and exposure, including any unpaid financing lease facilities, will be taken into account by the banks.
Is obtaining asset financing easy?
Asset financing is more effortless to receive than standard bank loans because it is secured by assets you already own, giving banks peace of mind that they will be reimbursed for their investment. Budgeting and cash flow management are made simple by the fact that asset financing payback schedules are frequently preset.
What are you able to buy with asset finance?
Asset financing enables businesses to obtain the machinery, vehicles, equipment, and other assets they require without incurring the high upfront cost of doing so.
We Can Help You Find your Asset Finance Solution that Works for You
