Commercial Finance for your Business

Ensuring your business is funded with correct strategy in mind is a vital part of ensuring successful, long term growth of your business. Getting the funding wrong can mean you can end up with higher costs and interest rates and worst still, lost time or even not getting the finance at all.
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So how do you fund your business correctly?

Planning. Just like you make plans to grow, market and operate your business, whether it is written down or not, you also need to plan the funding you will need.

Why? Ensuring that you and your accountant’s goals are aligned, you can obtain the best pricing and terms, and you have the correct funding to facilitate your growth.

Commercial lending is often used as a general term for any and all business finance products. There is a range of different commercial finance product categories that you should be aware of when considering how to fund your business correctly. Not only that, but understanding the different lenders policies of each of those products is critical.

Understanding what each is and what it is used for will help you decide the best finance for your business.

The Different Types of Commercial Finance

Equipment and Asset Finance

If you need a vehicle or equipment for your business, an asset finance or equipment finance facility allows you to use the asset itself as security and often we can fund 100% of the purchase price or asset value.
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What Is It Used For
  • Any serial numbered asset or equipment as long as it isn’t too old
  • Vehicles, manufacturing, IT, yellow goods, engineering. Call to check.
Typical Terms
  • Fund up to 100% of the purchase price
  • 12 – 60 mths terms (84 months for solar)
  • Balloon and residual payments available
Time Frame to Approval
  • Often 1-2 business days

Cash Flow Funding

If you are a business that receives payment terms from suppliers or offers payment terms to your customers, you will undoubtedly face times when you experience pressures caused by imbalances in cash coming in vs money going out. During these times a Cash Flow Funding Facility to utilise your business assets and debtors ledger as a way to release cash flow you might have tied up.
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What Is It Used For
  • Releasing cash tied up in outstanding payments and allowing the purchase of required stock and inventory before payment is received
  • Inventory Purchases
  • Day to day operations of the business
Typical Terms
  • 30 – 180 days
  • 100% of Supplier Invoices
  • Up to 85% of Debtor Invoices
Time Frame to Approval
  • 1- 4 weeks depending on the lender and complexity of the application

 

Commercial Property Financing

Australian’s historically have an affinity to property. Commercial property is no different. If you currently lease your premises for your business, you may find it can work out more cost effective to purchase the premises instead. Alternatively, a commercial property investment is also commonplace. There is a range of lenders that can assist with a commercial property purchase or refinancing.
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What Is It Used For
  • Purchase Commerical Property
  • Purchase of Commercial Property in SMSF
  • Refinancing of Commercial Property
Typical Terms
  • 12 months to 25-year loan terms
  • No & Low Doc applications available
  • Variable and Fixed Rates
Time Frame to Approval
  • 1- 4 weeks depending on the lender and complexity of the application

Development Finance

If you are looking to complete a small land subdivision or a large scale residential development, you are likely going to need finance to complete the construction. Development Finance is for experienced developers who have a history of delivering successful projects given its complexity. Facilities are tailored to the project and involve several milestone stages.
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What Is It Used For
  • Land Subdivision
  • Residential Unit Developments
  • ple
Typical Terms
  • 12 months to 24 mths terms
  • 70% of Gross Realisation
  • 80% of Total Development Costs
Time Frame to Approval
  • 3 – 6 weeks depending on the lender and complexity of the application

Specialist Lending

Specialist Lending is an exclusive range of lending policies available to specific industries and professionals. Medical professionals, accountants, solicitors, real estate property managers, child care and aged care all have particular industry policies that are tailored to the unique characteristics of their industries to enable better access to funding. These policies vary widely depending on your industry.
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Unsecured Business Loans

Over the last decade, traditional lenders for business finance have been shifting. No longer do you need to go to your bank and wait weeks to access a business loan to grow your business.

There are now speciality Business Loans and Line of Credit product providers that can approve your application in hours not days, lending up to $500,000 unsecured. This evolving product has helped thousands of business get the capital they need to grow their business.

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What Is It Used For
  • Any worthwhile purpose – including ATO debts
Typical Terms
  • 1 to 36 months
  • Daily or weekly payments
  • Unsecured
  • Variable interest rates
Time Frame to Approval
  • 1 – 24 hours

Commercial Finance Strategic Planning

It is common to often look at a commercial finance facility when the immediate need arises. However, there is a drawback to this approach – you risk sacrificing pricing or favourable facility terms due to a lack of preparation and planning.

Like in sport, the best defence is offence. Being reactive to your funding needs in the business can put you in a position of weakness; being at the mercy of lender terms based on your current situation. There is a wide range of products available, preparing ahead of time can significantly position your business for success, ensuring you have the finance you need, when you need it, at the best times.

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