It goes without saying that the high street banks have a captive audience when it comes to providing business finance. Most businesses will turn to their business banker in times of need. Whether it is a bank overdraft commercial mortgage , equipment finance or invoice finance your friendly manager will be only too please to help. Remember though when it comes to the different forms of business finance for every high street bank offering finance their is an alternative independent company offering funding.

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According to a recent quarterly business  index economic survey the general feeling amongst North West Businesses is that their is an air of optimism and enthusiasm about the future. However many of the businesses feel that trading conditions are worse than they were 12 months ago.

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Although we are officially out of the recession i firmly believe the economy is still on the edge. As such it will be a long time before banks and high street finance companiesgo back to their cavalier days of lending money to any tom dick and harry. It is bad enough getting finance with a clean credit history and even more difficult if you have any adverse credit. this doesnt mean you wont get finance however you can expect to pay more in terms of interest rates and you will also find the security required will be more onerous.

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There are two ways of obtaining business  finance for MBOs. Firstly banks can do cash flow lends or an asset based lender can finance the assets within the business to provide the cash. The problem with banks is that during the recession they have had their fingers burnt with cash flow lends. Significant amounts of money are lent against the future profitability of the business. There can be potentially little security for the banks and  it easy to see why the banks have been writing off significant amounts of bad debt. During 2009 banks were doing hardly any cash flow lends however during 2010 we can expect this to increase as the economic recovery start to take effect and the banks relax their cautious underwriting approach.

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There are so many business financing options available for a new start business.  Nearly all the banks can offer a plethora of funding options however which ones are best suited for a new start business.

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Business Finance covers a great number  of financial products many of which can be provided by independent finance companies as opposed to bank based lending. We would suggest that organising business finance has a great deal of benefits when using independentbased lenders. In the current economic climate it is advisable to spread as many types of lending with as many different lenders as possible. Never has it been more prudent not to have all your eggs in one basket. Fundng from asset based lenders is still relatively abundant therefore in theory it should be easier to be less reliant of the banks.

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Happy New Year to all our customers and potential new customers. 2010 is undoubtedly going to be an interesting year. On the one hand we started to see a recovery towards the back end of 2009. The number of enquiries we were getting from businesses requiring help with asset finance was definitely on the the up. From our point of view we were definitely starting to see the green shoots of recovery. On the other hand the government must seriously eat into the deficit created by quantitative easing. We are expecting an increase in taxes and massive cut in governmentspending. In our opinion the economy is still balancing on a cliff edge. So what does this mean in terms of obtaining credit.

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Without a doubt 2009 was the toughest trading year for any business that most of us can remember ( unless you are selling Pizza or home safes!). No one was expecting the recession however with hindsight it is easy to say ” I told you so”.  Twelve months ago there were a dozen or so high street finance companies and banks offering hire purchase and finance lease facilities. At the moment there are only a handful remaining. Many an  independent finance company and bedroom brokers have gone out of business. The longer established independents have the experience and expertise to add value to any business financing. At XL Business we have been helping our clients for over 10 years with their business finance requirements. We envisage the banks being extremely difficult for at least the next 12 months so it is important that you use an expert to help your business with  your funding requirements.

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Gone are the days when it was easy to get a mortgage just based on the value of the property. Until the credit crunch there were a number of commercial mortage companies offering funding of up to 80% of the valuation of the property. It was dead easy. It was just like getting a self certificated personal mortgage ( and by the way they have all gone from the market as well).

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Unlikely anyone is reading the blog today especially when most people will be hung over in  some form or another. However we wanted to take the opportunity to wish all our customers all the very  best for 2010. Most of will be delighted that 2009 is behind us which can only be described as the worst year from a business point of view that any us can remember. Anyone who says that they have had a great year is lying. Most businesses have been treading water at best and the ones that have survived 2009 and can survive the continued turmoil in 2010 will undoubtedly be in a very strong position when things eventually start to pick up.

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