What is asset finance and how can I get it?

Asset finance can be the catalyst to the growth of your business, preserving cash flow and allowing you to pay over time as the assets work in your business. But what exactly is it, how does it work, and how can you get it?

We answer all your questions here…

What is asset finance?

Asset Finance is a finance option that businesses can use to grow, by acquiring much needed equipment without having to pay upfront. Instead of buying the asset straight out, you will pay a regular amount to use the asset over an agreed period. This means you’ll avoid the full cost of buying outright.

Waiting until you’ve got enough cash upfront to purchase an asset can slow down your business growth, which is why asset finance can be so valuable to a business: it allows you to obtain the assets you need for your business without having to wait.

These days, many business assets are financed using a range of specific asset finance facilities, allowing businesses to retain their cash and pay for the assets over time in smaller, affordable payments.

What can I use it for?

You might be surprised by the range of assets that can be financed. From commercial vehicles and manufacturing machinery, to full office fit outs and IT upgrades, there are a number of options available for financing your assets. Even intangible assets such as partitioning and mezzanine floors can be funded. Vehicle fleets and farm machinery can be purchased through this type of finance.

Asset finance is ideal for businesses in sectors that are heavily reliant on assets, such as haulage, construction, engineering, and manufacturing.

How does it work?

Asset finance allows smaller businesses such as sole traders and limited companies to obtain high value assets and benefit from these assets without paying for them up front and in full, which frees up cash for use in working capital.

Facilities start from £5,000 and go up to £10M. Deals can be agreed within hours and completed the same day. Normally the asset being financed is the only security required, leaving your other business assets unencumbered.

The asset finance company recuperates the asset’s cost over an agreed period. This is usually between one and seven years, but the duration may be longer for more expensive assets. As a borrower, you’ll have to show that you can afford to make the agreed repayments.

What are the benefits of asset financing?

There are a number of benefits of asset financing, such as:

– The facilities provided by most funders will not affect your bank borrowings.
– In contrast to traditional loans, asset finance could actually make it easier to raise funds for additional finance needs.
– Avoiding paying for an asset outright and spread the cost instead. This can help maintain a healthy cash flow for your business, and maintain control over working capital.
– Asset finance allows you to grow without the limits of saving up to purchase an asset. It means you can access the latest equipment and technology when you need it. Ultimately giving you an edge over your competitors.

Am I eligible for asset finance, and how can I get it?

If you have a business that can meet its financial obligations, then you are eligible for asset finance. Whether you’re a sole trader, startup, limited company, or a partnership, there are finance options to suit your business needs.

However, finding the best asset finance options with the most competitive rates can be time-consuming and complicated. That’s why it’s always a good idea to speak to an experienced financial facilitator. PMD is well-versed in asset finance and has an extensive network of finance providers. For example, PMD works with around 100 asset finance providers who all specialise in either certain industries or asset types. These funders all provide specific facilities that will not affect your bank borrowings.

How can PMD help?

When it comes to asset finance, PMD has an unrivalled range of solutions, specialists, and access to over 100 lenders, and can open up a number of flexible, independent and competitive funding lines to drive your business forward.

PMD will take the hard work out of securing finance, liaising with funders on your behalf to ensure the best possible terms are secured, leaving you free to focus on running your business.

PMD can source facilities for almost any business asset. We can structure these with nil deposits, VAT deferrals and extended terms to meet your cash flow.

If you’re considering using asset finance as a way to grow your business without limits, get in touch today to see how PMD can help. We can provide all the advice and guidance you need, as well as ensuring a streamlined, stress-free process.

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