Asset Based Financing

Asset based financing is a business funding mechanism that provides a company with equity that is required for the purchase of assets. These assets may be needed to maintain and develop a business for the future.

If a business had to pay directly for these new assets it could prove to be a problem. Asset backed finance relieves these problems by providing a loan that is repaid by regular payments over an agreed period of time.

Business Services UK are in contact with institutions that provide asset backed financing. We are able to provide our clients with free information on which asset finance companies would best suit their needs.

By utilising asset financing your company would be in a position to obtain new equipment without paying out a large amount of capital. If your company has already purchased expensive equipment you could use sale and leaseback finance to release the capital from these existing assets and therefore increasing your cash flow.

Asset Based Financing Can Be Made Available For

Motor vehicles
Plant
Machinery
Office equipment

There are however certain areas to be aware of when it comes to asset financing, these are:

Legal ownership - you have to be in possession of a hire-purchase leasing agreement or you will not actually have ownership of the asset

Asset depreciation - if after a period of time you have to return the asset it is important to realise it may depreciate in value.

Asset maintenance - be aware you may be responsible for the maintenance of the assets

Purchase option - if you hire-purchase the asset make sure you negotiate the repurchase is set at a predetermined price. This should be contained in your contract.

Business Services UK are able to use our extensive network to provide our clients with a wide range of funding options. If you would like to discuss asset financing with a member of our staff please click the Contact Us button.