There are various options available for gaining finance to expand your business or provide a cash injection but understanding which is right for you requires some background research and full knowledge of your business. A financial broker like J & J Commercial Finance will spend time finding out about your business and presenting you with the options best suited to your needs.
J & J Commercial Finance will take many considerations into account such as how long are the funds needed for and when will the funds be paid back? Also, how much will it cost your business to get the finance and which is cheaper for your business?
Working capital business loan
If you have no assets, are a new company and have good relationships with creditors then invoice factoring and asset financing won’t be the right option for your business. Whereas a working capital business loan also known as a commercial loan can be either secured or unsecured and can have a personal guarantee attached onto it.
The benefit of a commercial loan is that it is structured, there will be monthly repayments which will suit some businesses more than the other options for finance. Recently, some finance companies have started to offer early repayment with no fees which gives that added flexibility for those businesses that want structure but also option to pay more sooner.
If you have assets in the finance such as equipment or tools that you own outright these can be used to release equity and secure finance. A finance company will buy these assets from you for a set amount and then lease them back to you. The benefit of this is that you will still have the assets but also a cash advance for your business going forward.
This can generally be a safer way of borrowing finance than a commercial loan but the amount you can secure is not as high.
If you have a 30-, 60- or 90- day debtor book this may be a suitable option for raising finance for your business. J & J Commercial Finance will work closely with your accountant to understand in full your debtor book. Using this knowledge and understanding we will be able to create a ‘profile’ of what your debtor book looks like. This can be used by us to approach our network of over 300 finance lenders to do a cash advance on invoices that are still to be paid. When the invoices are paid in full this money is then paid straight back to the finance company. The benefit of this option is that the loan is short-term and reduces the risk of debt building up.
Which is the right option for finance for my business?
Here at J & J Commercial Finance we will get to know your business inside out through meeting with you and doing extensive research including asking the right questions to understand what your business needs. We will then use our network of over 300 lenders to find options for you and present these in the form of a proposal.
If you want to put some money into your business then send J & J Commercial Finance a message or head over to our website. We offer you a free, impartial and totally confidential initial consultation and we will quickly assess the funding options available to you.