Finance companies and banks are still short of capital. They all tell you they are open for business but in reality they are still short of cash. In our opinion are they are looking for reasons to decline deals rather than agree them. In short it is simple supply and demand. As a result interest rates available in commercial lending do no really reflect the current low bank base rate. If you have been declined finance a good independent finance broker may be able to help you source finance. There are still a number of lessor known finance companies who are actively growing their books and very much open for business.
If you have been declined finance by a bank it could be possible you are caught between a rock and a hard stone. Businesses investing in capital equipment may find that their profitability and balance sheet is not strong enough to justify a high street finance or bank lend. There are very few near prime funders that will take a few especially if the equipment is not a traditional piece of kit with a good residual value. Asset lenders are still very much open for business. However they will only lend against a professional valuers forced sale value typically at 80% loan to value. Interests rates are much high than the banks and nearly all deals require the directors to provide a personal guarantee. IF there is not enough value in the assets being financed it may be possible to use existing unencumbered equipment to provide additional security. Next step would be to look at taking a charge over property. Not what you want to here I know but it is very much a lenders market!
