Asset finance is a way of funding business vehicles, machinery, and equipment without having to pay a large sum upfront. As the asset acts as security, it can help you access more funding and can be at a lower cost than an unsecured loan.

Asset Finance is provided against specific assets. A ‘charge’ is taken over the asset ensuring asset finance is easier to raise than other traditional forms of debt. Funders like the identifiable, tangible, and quick turn nature of Asset Finance. Soft Assets are those with little or no resell value. Like specific business software, Warehouse Racking or Air Conditioning. We can still write the deal via an Asset Finance agreement albeit you may have to give additional security to give some comfort to the lender.

Asset Finance is provided against specific assets. A ‘charge’ is taken over the asset ensuring asset finance is easier to raise than other traditional forms of debt. Funders like the identifiable, tangible, and quick turn nature of Asset Finance. Soft Assets are those with little or no resell value. Like specific business software, Warehouse Racking or Air Conditioning. We can still write the deal via an Asset Finance agreement albeit you may have to give additional security to give some comfort to the lender.

Asset Finance on most occasions is cheaper than commercial loans and due to the security being in the Asset itself you don’t have to worry about repercussions the family home or being personally liable in un-regulated AF business transactions.

Hire Purchase / Lease Purchase

Traditionally, the most popular form of asset finance is because at the end of the term the asset is owned outright with the asset being noted on the company balance sheet. The company puts down a deposit to show their commitment, although in some circumstances a deposit may not be required. The company must pay the VAT at the outset. Capital and interest are paid over the term of the agreement with terms up to 7 years potentially available. Sometimes a residual balloon payment can be agreed at the outset which in turn reduces the monthly repayments.

This differs from hire purchase in that ownership of the asset remains with the finance company and the finance company rent the asset to the business over a specified period. At the end of the initial agreement, the business has the option to continue using the asset by paying a ‘Secondary Period Rental’ (a reduced monthly cost) or return the goods. Most funders now prefer that the customer sells the equipment and retains most of the sales proceeds after agreeing a saleable value.

VAT payments are spread over the term of the agreement and the monthly leasing payments can be claimed as an allowable business expense.

With an operating lease, the company benefits from the use of the asset over a pre-determined term without ever actually owning the asset. The company therefore benefits by negating all the risk associated with owning the asset, such as depreciation. The finance company will take all the risk of the future value of the asset and any disposal costs. This enables you the full use of the asset throughout the agreement with the added benefit of a built-in residual value, thus reducing your monthly rentals. Op Lease agreements being off balance sheet will change in 2026 so will also change accounting practices for businesses who have utilised this practice previously.

Every business need’s working capital and a commercial loan is the simplest way of injecting cash straight into the business. There can be several reasons behind the requirement so it’s best to talk it through to make sure that there’s not another more suitable and sustainable option as loans aren’t the most cost effective due to the lack of security provided to the lender. Invoice Finance, Factoring or Merchant Finance may be better facilities.

If you need an injection of cash for any reason, then asset refinance maybe a viable option. Asset refinance can assist with restructuring the entire business or just as simply, a way of freeing up some working capital through the equity contained within assets the business owns. Cheaper with no additional security required. An asset refinance package can be a fast solution for unlocking valuable cash to help your business grow, without interruptions to company operations.