Your bank plays an important part in providing the transactional facilities for your day to day business banking requirements which may include provision of an overdraft or a line of credit to help you manage the high and lows of cashflow. Facilitating loan requirements for the initial purchase of a business or the purchase of commercial property may also be important services that you bank provides, lending products that are in most cases secured by real estate.
However, Equipment Finance may not be a service that your designated Bank Manager is greatly familiar with, and in many cases calls upon a separate Equipment Finance department of the bank to assist. Smaller banks, credit unions & building societies may not even provide equipment finance products.
Equipment Finance is often described as Asset Finance and unlike traditional bank loans is not generally secured by real estate, but secured by the business equipment asset being purchased, using products such as Chattel Mortgage, Hire Purchase or Lease.
If you are not familiar with what “Equipment Finance” constitutes, you can learn more about it here: What is Equipment Finance?
Following we will explore some of the reasons you may opt for a specialist equipment finance broker to assist with obtaining funding for your business equipment needs.
Knowledge and Skills to assist you
Equipment Finance Brokers in most cases have a history of working for a dedicated Equipment Finance lender or an Equipment Finance department of a bank. They are very familiar with the products and the need for providing a fast end to end service.
As current Equipment Finance Brokers their day to day work centres on assisting businesses with obtaining funding for equipment assets, giving them a strong understanding & knowledge of customer needs. They have strong relationships with equipment financiers, placing them in an ideal position to help you negotiate the right price and the right approval.
Multiple dedicated Equipment Financiers bidding for your business
With access to more than one equipment financer, an equipment finance broker provides a one stop location for you to compare & negotiate pricing, helping you to eliminate a great deal of leg work.
Your repayments will be competitive with multiple lenders participating to try and secure your finance application.
Access to various Equipment Lenders provides flexibility with application Approval
Any one bank or financier can be rigid with it’s finance policies dependant on factors such as:-
- The goods you require finance for
- The age of the goods your require finance for
- If the goods are being supplied by a dealer or by a private seller
- Your chosen industry
- Your time in business
- Your equity in real estate and other assets
- The finance structure you require
- The ability for you to provide financial information
- The way the lender analyses financial data
If your proposed application is not something your chosen bank has comfort with, you may face higher than required payments, unwanted or unnecessary approval conditions, or even a decline to proceed with your application.
A good business finance broker will be familiar with financier policy and application acceptance helping to guide you to negotiate the best outcome.
If No-Fuss Fast Finance is important to you
Equipment Finance brokers are very familiar with the fast pace requirements of providing lending for assets using chattel mortgage, hire purchase and leasing. Banks who are accustomed to the slower pace of business loans secured by property, have been known to struggle with this fast pace requirement.
A choice of financiers via a broker allows the ability to isolate the financiers who are most likely to provide the competitive outcome required, but with the minimum of fuss for you, the customer.
With the financiers being well aware of the fast pace no-fuss requirements, to compete, they offer varying short-form type applications or no-financials application policies.
An equipment finance broker can help you quickly navigate these policies that vary between financiers and application types.
Choice doesn’t have to come at a cost
Many equipment finance brokers don’t charge the customer a fee for their service, rather the lender pays the broker for work that the lender themselves would have otherwise had to bear the cost of.
See here for more information about how an equipment finance broker is paid.
For your next business equipment purchase, you may consider using the services of a business finance broker, well versed in equipment finance to do the leg work for you, providing you with not only choice and flexibility, but a no-fuss easier solution.
Visit here, for more information about Broadlink’s equipment finance services.
Disclaimer: The information in this article is not intended to, and should not be relied upon, to provide tax, legal, investment or accounting advice. You should consider whether the information is appropriate to your needs, and where appropriate, consult your own tax, legal, investment or accounting advice.