Financial outlay is always painful for a business even though it’s usually part of exciting growth. Here are some insights to help business owners.
Shop Around Before Pitching Your Loan Procurement
Property loan interest rates and equipment loan interest rates are two very different things. Equipment loan interest rates are an open free market, so gain a full understanding, build the best argument and pitch your business (loan procurement). Shop hard, negotiate harder. You can drive a rate down by up to two points which could equal savings of hundreds of thousands of dollars overtime.
What’s Yours Is Yours, What’s Theirs Is Theirs
Anyone giving out a loan wants to cover their risks and the more they cover it, the less they are going to pay to the underwriter in the background. And the more they are going to make off the deal. Don’t, however, be talked into providing security for the loan. The security is the equipment that you are purchasing, it in itself is the security so hands-off anything else you own.
Drive Competitiveness, Reduce Your Risk
So, you found a company that seems to be fitting the bill as a financier. Don’t give all the business to them. Instead, involve several financiers in the loan arrangement for your equipment. This will drive competitiveness and reduce your risk. When you need loans in the future, you will then have a larger base of lenders that have an existing relationship with you.
The Red Tape Has Reduced
Financiers no longer require financials. A behavioural assessment is now done instead. No, there are no psychologists involved, it is business behaviour. If a company has been trading for two years, has a clean credit history and you, the owner, are a property owner then you are good to go.
Private Sales Are Attractive
The finance market has recognised the business benefits of private sales to businesses so to improve better business management by business owners the market accommodates private sales. Such purchases can bring about huge savings to a business, especially if it is second-hand equipment. The latter can also be financed. The extra steps are an inspection and a more thorough proof of ownership to make sure the correct title of ownership changes hands.
There are many other tips we can advise you on relating to tax deductions, loan versus overdraft and so on. If you want to make sure you have considered all the options and want to see if there is a customisable finance option for your equipment loan in the Gold Coast give us a call today Ph. 1300 557 027.