Asset Finance

In Asset Finance, owners of small businesses can use assets as security to borrow money or take out loans to cover the necessary tools and machinery they need for their business, without having to pay massive amounts in interest. An asset is used regularly for an agreed time, which avoids the need to pay the full cost.

PROS:-

• No need for large amounts of money upfront to purchase a vehicle or equipment needed.
• Free up cash for business expenses and other opportunities
• A low document approval rate.
• A loan is offered for a longer term between 2 to 5 years.
• Lower interest rates are charged.
• Easier to obtain with an average credit score.
• It is generally backed by the underlying asset without requiring real estate security.

CONS:-

• You cannot sell or dispose of the vehicle or equipment unless the loan is repaid.
• A lender can charge early repayment fees on a vehicle or equipment finance.
• There is the risk of losing important assets required for running a business.