Asset Refinance

Asset refinance advice and brokerage is an important part of our business. Asset finance involves an agreement where the asset owner collaborates with an asset leasing company to identify and value the asset. Based on the asset’s equity and valuation, the leasing company provides funding. The parties then draw up a refinance or lease agreement, and the asset owner makes regular payments to the finance company over an agreed period.

Many asset‑rich businesses choose asset‑backed refinancing to unlock cash tied up in equipment they already own. Leveraging these assets releases working capital without adding unsecured debt, and the regular repayments qualify as operating expenses—providing a useful tax advantage.

The main advantages of asset refinance are:

• Simple and cost effective method to release funds from existing balance sheet assets
• Fast method of accessing cash in cases of emergency or as a method to fund expansion.
• The business can continue to use the asset without any break.
• Asset finance is a flexible way to access funds
• Agreements can be paid weekly, monthly or quarterly to suit.
• Refinance agreements are usually paid back at a set rate of interest.
• The cost of refinance payments are Profit/Loss items so do appear on the balance sheet.
• Asset refinance payments are treated as a business expense rather than debt, so they don’t affect the company’s credit rating.
• Asset refinance can provide a much need cash injection in times when business is challenging.
• Financial directors often favour asset to avoid hefty depreciation allowances.

Disadvantages of asset refinance

• The borrower will pay back more than the original price of the asset.
• Refinance contracts tend to be rigid, set over a fixed term.
• Lenders generally offer fixed interest rates.
• To secure the refinance, business owners or directors are often asked to provide personal guarantees.

Which assets can you use for asset finance?

• Property
• Machinery
• Technology

We are experts in the asset refinance section and can advice on arrangements that suit both the borrower and lender. Please contact us to receive an asset finance quote.