Asset finance leasing - XL Business finance

Stocking Finance

January 26th, 2009

It appears businesses are increasinlg looking for additional means of funding working capital other than the their bank overdraft. Stocking finance is a viable addition to taditional cash flow finance facilities. Stocking finance is usually provided in conjunction with a factoring or invoice discounting facility. Not all factoring or invoice discounting companies povide a true stocking facility. All say they do but most only provide funds against stock to provide an over advance of equal to and no more than the total debtor book. Furthermore they wil reduce the advance over an agreed period back to the agreed payment of the debtor book. IE 85-90%. There are only a handful of true revolving stock facilities where an agreeed percentage of the stock is permanently advanced on a revolving credit basis. Remember this facility must be used in conjunction with the factoring or invoice discounting facility.

Euro Deals

January 12th, 2009

It may be worth mentioning it is possible to write larger hire purchase and leasing deals in Euros. In view of the very weak pound a business may be better off drawing the funds in Euros and paying the finance company in Euros. This will only work if its operates a euro account which will therefore eradicate any exchange rate fluctuations. Obviously any business equipment finance facility is subject to credit approval!

Happy New Year

January 5th, 2009

Looks as though XL Business Finance will be hitting the ground running in the new year. We are handling an unprecedented number of enquiries for businesses  refinancing existing machinery. Deals vary from a small bakery wishing to reduce its £15k OD with the bank right through to a 10m turnover engineering company wishing to raise £250k  working capital for new contracts in 2009. No matter how big or small your equipment, so long as it has some value it may be possible to release some equity. Have a great 2009!

Bank Overdraft or Invoice Factoring

December 15th, 2008

Not only are we midst of a recession but when it comes to the banking and finance sector we are heading into unchartered territory. More and more banks are restricting borrowing  to their own customers (and the good ones at that). XL Business Finance are seeing more and more customers  wishing to switch from bank overdraft to factoring or invoice discounting. Most overdrafts are repayable on demand and the banks can and do withdraw overdraft  facilities at the first sign of trouble. Never has it been more true that banks are happy to give you an umbrella, but at the first sign of rain they want it back. Why take the risk? Not only will a factoring or invoice discounting facility replace your overdraft facility it can quite often provide additional working capital and will grow with your business.

Providing you are operating within the terms of facility factoring or invoice discounting it won’t be pulled from under your feet. As an independent factoring broker, XL Business Finance can guide you through the maze of different factoring companies. Not all factoring companies are the same and we can certainly add value in helping you find the right funding partner.

New Start Business Finance

December 10th, 2008

Obtaining finance for new start businesses can be tricky at the best of times. High street banks and finance companies have virtually shut up shop. And at the best of times they would require costly projections and business plans, get the customer to jump through hoops and probably say no. Thankfully there are still a handful of lesser known smaller companies willing to look at asset finance leasing for new start businesses. Providing the proprietors are home owners with a bit of equity and have a relatively clear personal credit profile it may be possible to obtain finance up to a certain level without too much of a problem. Admittedly personal guarantees will be required and the rate will be higher than a high street bank but might enable the business to borrow in a tax efficient manner and obtain the funding for the much needed piece of kit.

Tis the season of Refinance

December 1st, 2008

Batten down the hatches! Christmas is coming!  Sales down, bank balanace in the red. Just what a faltering economy needs is a shut down for two weeks over the Christmas period. How is your cashflow going to survive until the middle of January? Well we are currently receiving an unprecedented number of enquiries about refinancing existing machinery. So long as a business asset can be indentified and it has a value, it can be refinanced. We can even refinance equipment which is already on finance with another funder. So long as it has equity a deal can be done. We have even done deals where we have taken out existing finance companies providing a large lump of cash for working capital and provided a lower monthly payment.

Obtaining asset finance in the credit crunch

November 28th, 2008

So the banks have been told to start lending money to businesses and individuals to help kick start the economy. The truth is the banks have had their fingers burnt (deservedly so, some may say).

All high street banks and finance companies have tightened their underwriting criteria. Some have withdrawn from certain sectors and some have withdrawn completely. The result is that there seem to me more deals knocking around the broker market as customers are trying to find equipment finance for their acquisitions and investments.

The problem is that the second and third tier funders are awash with more deals than they have ever had. In uncertain times and possibility of a long recession, these second and third tier funders are cherry picking deals. They are concentrating on hard assets with good residual value, strong covenants and a good PG. Their attitude is a ‘take it or leave it’ mentality, as they know the customers have little choice. Interest rates tend to be on the higher side as they know the banks and high street finance companies are not playing ball.

The result is little choice and higher rates. It is now very difficult to organise finance for new start businesses,  high tech equipment and businesses with a poor trading history. The good news is that there are still funders which can cover most eventualities (however there are fewer of them) and a good finance broker has never been able to add as much value.

 
 
 

XL Business Finance Ltd is a privately owned and independent business financing company with established links to many of the UK's leading finance houses. XL Business Finance provides a viable alternative to high street banks that lack the flexibility and imagination to provide a solution to most business users requirements. XL Business Finance can provide a full range of business financing solutions and we ensure a high level of customer service and pride ourselves on quick decisions. Our independent status will ensure any offer of funding and asset finance leasing is best suited to our customer’s needs.

XL Business Finance, Eaton Place Business Centre, 114 Washway Road, Sale, Cheshire M33 7RF UK.

 

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