BUSINESS LOANS

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ATTENTION: ALL Businesses NEED To

Get Business Finance Ready Today!

RedCap Consulting has advised their clients with regard to business finance and business health...

"All businesses, whether startup, growing, or long-term established will be required to supply prospective financial data. Most of the time, lenders not only want to see what your business has accomplished in the past two to five years, BUT will want to see what you expect your company to be able to do within the next five years. Each year's business financial health plan should include forecasted income statements, balance sheets, cash flow statements, and capital expenditure budgets.

They want to know not only What you have done, but What you plan to do, and How you will do it!"

RedCap Finance Brokers (who are accredited with EZFinance Commercial Pty Ltd) Can Help With ALL BUSINESS FINANCE MATTERS!

Raise your Funding Profile

Preparing detailed budgets and sticking to them can help show lenders and/or potential investors that you can develop a business plan and that you can make your business work for all stakeholders.

Lenders and investors certainly will want to dig deeply into your finances, but if they don't see evidence of strong budgeting practices, it might be enough of a red flag to turn them away from lending to you, the debt funds or the equity funds that you need to grow your business, and make it succeed.

Business is hard enough, without Knowing what you need to do. Success doesn't just happen - it is the result of hard work to bring an idea into fruition.

Accurate Detailed Budgeting - REDUCES RISK!

Budget for Business Health

The benefits of budgeting should never be underestimated when running a business.

A detailed and realistic budget is one of the most important tools to successfully manage your business. Budgeting is the basis for all business success. It helps with both planning and control of the finances of the business - and very importantly - Business CASHFLOW!

Business Health Leads To Business Wealth

You have got to KNOW your numbers,

IF you want to GROW your business!

Debt Financing vs Equity Financing

Debt Financing, the lender doesn't get any portion of your profits or have a say in the business. Managing your finances to meet loan repayments is far easier on a business owner than accounting for profits with an equity investor. With a loan, you will have regular monthly payments for a fixed period. Interest payments can be deducted as a business expense.

Equity financing refers to funds generated by the sale of stock. The main benefit of equity financing is that funds need not be repaid! Since equity financing is a greater risk to the investor than debt financing is to the lender, the cost of equity is often higher than the cost of debt. The biggest burden on the business owner / manager is the need for comprehensive reporting and ongoing accountability to the Equity investor.

CAPITAL COST: How it is paid! 

When financing a company, "cost" is the measurable cost of obtaining capital.

  • With DEBT, the cost of capital refers to the interest expense a company pays on its debt. (If a company fails to generate enough cash, the fixed-cost nature of debt can prove too burdensome on businesses. This basic idea represents the risk associated with debt financing.)
  • With EQUITY, the cost of capital refers to the claim on earnings provided to shareholders for their ownership stake in the business. (Companies are never totally certain what their earnings will amount to in the future (although they can make reasonable estimates based on benchmark assumptions). The more uncertain their future earnings are, the more risk is presented to the marketplace. As a result, businesses in very stable industries with consistent cash flows generally make a heavier use of debt funding than businesses in risky industries, or businesses who are very small, or businesses that are just beginning their operations. New businesses with high uncertainty may have a difficult time obtaining debt financing and often finance their operations largely through equity - either from family, friends, or private investors.

Adjust your Cashflow Forecasts

Successful businesses allocate time to create and manage budgets and regularly monitor their financial situation and business performance.

Adjusting financial forecasts based on actual results is critical to get a clear view of the financial health of your business

#1 Priority is to Manage your Cashflow

Business Cash Flow Management is the most important aspect of managing every business - regardless of size, or years in existence.

Why Small Businesses Fail

(from Jessie Hagen of U.S. Bank, cited on the SCORE/Counselors to America’s Small Business website http://www.score.org)

  • 82% – Poor cash flow management skills/poor understanding of cash flow
  • 79% – Starting out with too little money
  • 78% – Lack of well-developed business plan, including insufficient research on the business before starting it
  • 77% – Not pricing properly or failure to include all necessary items when setting prices
  • 73% – Being overly optimistic about achievable sales, money required, and about what needs to be done to be successful
  • 70% – Not recognizing or ignoring what they don’t do well and not seeking help from those who do

RedCap Consulting advises: "As a business owner, you need to have a clear view of your cash flow forecast - Your Survival Depends On It!"

Investing in Good Accounting Software and Cash Flow Forecasting Software is vital to Business Health!

Employing / Hiring Great Financial Consultants (Business Coaches, Business Finance Broker, Accountants, Bookkeepers, and Solicitors) may ultimately be the key to your business survival.


BUSINESS & COMMERCIAL DEBT FUNDING OPTIONS

Please Note: RedCap Finance Brokers who are accredited with EZFinance Commercial Pty Ltd  (ACN: 639833604) Advise clients that this entity is a different entity to EZFinance Pty Ltd (ACN:140178383). Both entities operate under Australian Credit Licence number 392611

  • EZFinance Commercial Pty Ltd deals with all Commercial and Business finance (*NCCP Act Non-Coded Loans);
  • EZFinance Pty Ltd and it's representatives deal with all Consumer advice and applications (*NCCP Act Coded Loans).

BUSINESS FINANCE OPTIONS

Commercial & Business Loans Options

  • Vehicle Finance
  • Overdraft
  • Property development finance
  • Business loans /Line of credit/ Term loans
  • Cash flow finance
  • Hire Purchase
  • Chattel mortgage
  • unsecured business loans
  • Leasing finance
  • Buying or Selling a Business
  • Shop Fitting Finance
  • Business Equipment Finance

Please Note our Licensee - EZFinance Commercial, has developed strong relationships with a range of business and commercial lending specialists, private lenders, and major banks over a long period of time.

Therefore RedCap Finance Brokers are able to assist you with business finance for expansion, investment funding, leasing, purchase or refinance of commercial properties, retail shops, industrial land, factories, and offices, or cash flow lending.

Business finance options

Your RedCap Finance Brokers credit specialist can help you gain an understanding of your options and develop a sound financial plan on loan structures that suit you, low interest rates, effective structures, and a high level of service before committing to any expenditure.

Each lender has their own programs and their own requirements so our commercial specialists can also help you understand the differences between loan types and lenders, including related fees and charges.

There is a range of business facilities available, depending on the type of business you own or are purchasing, and whether you are looking for finance for a new or existing business.

Security for business and commercial loans

As with residential lending, your business or commercial finance lending will require something as security ( in most cases) for your loan.

Unlike residential lending where you are predominantly limited to offering property as security, with business and commercial finance you have a range of options available.

Security options may include:

  • Commercial property
  • Residential property
  • Guarantee of directors – often supported by residential/commercial property
  • Assets of business, including both tangible assets such as stock and intangible assets such as goodwill
  • Term deposit

There is a good variety of business and commercial loans available. Which one you ultimately choose will depend on your purpose for borrowing.

Vehicle Finance Options

Types of Car Loans

  • Car Loans
  • Finance (CAR & Truck) Lease
  • Commercial Hire Purchase (CHP)
  • Chattel Mortgage
  • Novated Lease ( and Salary Packaging)
  • Fully Maintained Novated Lease
  • Personal Loan
  • Unsecured Loans

Car Loans

A standard Car or Truck loan is the most common type of loan in the market place. The loan is secured against the vehicle for a specified term (normally 5-7 years). The customer will take possession of the vehicle at settlement of the purchase and the financier retains an interest in the vehicle until the entire loan is paid back. Standard terms available with this loan may include

  • A choice of variable or fixed loan repayments
  • A deposit made up of cash or trade-in may be used
  • A balloon Payment ( this is where 10%-30% of the purchase price is payable at the end of the loan term) can be built into the payment structure, effectively lowering the monthly repayment to suit most budgets.

This type of loan is suitable to the person who is looking to purchase a new or near new vehicle and may not have significant business use for the vehicle. (A tax deduction may apply to some fees or repayments if the vehicle is for business use - please seek advice from an accountant on this)

Finance (car or Truck) Lease

A Finance Lease is commonly used to purchase business or commercial vehicles. Whilst the purchaser has 100% use of the vehicle, the financier retains actual ownership. In essence, the financier purchases the vehicle on behalf of the customer, who then Leases the vehicle from the financier and pays a fixed monthly lease payment for the term of the lease. At the end of the lease period, the customer can either pay the residual amount owed (final lump sum payment) and take full ownership of the vehicle or re-finance the residual amount (or trade in the vehicle and start again with a new lease and new vehicle)

Normal structures for Leases include.-

  • Fixed monthly Lease payments
  • Monthly repayments can be lowered with a lump sum residual
  • All costs are known from the start
  • Lease payments can be made in advance for tax and cash flow purposes
  • GST is claimed by the financier, therefore only the purchase price excluding GST is financed, which in turn, will lower repayments.

Ideally, vehicle leasing is suitable for companies, partnerships, sole traders and individuals whereby the vehicle is used for income producing purposes.

Speak with our RedCAp Finance Brokers COMMERCIAL advisor for any Business or Commercial financing needs today - We are there to Help You!

“Getting Finance just got easy – EZ”

*Please note: Rates are subject to change without notice. Full terms and conditions and schedule of fees are set out in the lender's relevant loan contracts.

RedCap Finance Brokers: It is Always Good Financial Practice to speak with your Accountant or Financial Advisor before committing to any business finance or commercial contract.

“GETTING FINANCE JUST GOT EASY – EZ”

it's free - it's "EZ" - it's quick

VERY IMPORTANT - Your RedCap Finance Brokers credit advisor will assess your information quickly and this will determine which Banks or Lenders you may qualify with. This puts you back in control of your financial future!

RedCap Finance Brokers can organise a loan for you on-line or face to face (where possible).

RedCap Finance Brokers can also organise a pre-approval for you if you are looking to purchase a property so that you can negotiate with confidence on a good price for the property, knowing your buying power.

“Getting Finance just got easy – EZ”

Fill out the form below and be specific so that we can quickly assess and help you, or call us at any time on 1300 8178 73

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BUSINESS FINANCE OVERVIEW

“Getting Finance just got easy – EZ”

Overdraft

A business overdraft is an ideal financial option to cover short-term finance needs, particularly seasonal requirements and unexpected expenses. The business overdraft is still the most common type of business finance used in Australia, and operates as a line of credit facility that is most commonly used to cover any working capital requirements.

A business overdraft works by providing access to an agreed limit amount of money. You can draw up to your limit at any stage, and there are no repayments required as long as the amount you have drawn down and the interest charged does not exceed your agreed limit.

The overdraft facility operates on a variable interest rate with a cheque account attached, and you may or may not need to provide security or collateral, depending on the lender.

Property development finance

Development finance is very similar to a residential construction loan operating as a draw-down facility whereby you access funds required at each stage of the development, rather than the entire loan at one time.

A development finance facility is generally available for between one and five years, depending on the scope of the development project you are undertaking.

Most lenders will allow you to capitalise interest during the development period, with the full loan falling due upon sale of the development.

A minimum loan amount may apply to a development finance facility, usually around $500,000.

This is one of the most challenging types of loan to be funded by banks as there may be a need for a level of presales, mezzanine funds and equity participation.

Business loans /Line of credit/ Term loans

A business or term loan provides you with flexible access to finance when you need capital for purchasing a business or additional capital for business expansion, major plant and equipment upgrades, or purchasing commercial property.

The flexibility is in the loan type – both fixed rate and variable rate business loans are available – and you can usually choose to make principal and interest or interest only repayments.

Business loan terms vary widely between lenders, but can be as long as 30 years; the minimum loan amount you can borrow also varies widely so you will need to discuss your options with your residential and commercial finance credit advisor, at RedCap Finance Brokers

You will most likely be required to provide some form of security or collateral, such as residential or commercial property or business assets.

An additional benefit of a business or term loan is portability, with many allowing you to change the security used during the life of the loan.

Cash flow finance

Cash flow finance provides a business with access to the money tied up in outstanding Commercial invoices, allowing you to continue meeting your working capital requirements in periods of fluctuating or irregular cash flow.

With cash flow finance your business will generally be able to access funds totalling up to 80 per cent of the value of your unpaid invoices, which is particularly useful during periods of rapid growth, business acquisitions or seasonal sales cycles.

The outstanding value of your invoices acts as security so there is no need to use residential or commercial property or sales goods to secure a cash flow finance facility.

Hire Purchase

A hire purchase is a finance arrangement used to pay for goods over a period of time – usually one-to-five years – rather than paying the full cost upfront, with ownership retained by the financier until the hire purchase term is complete and you have made your final repayment. At the end of the hire purchase term the title of the goods automatically passes to your business.

Repayments on a hire purchase can be quite flexible and are often tailored to your business needs, ideal if your business operates on irregular cash flow due to seasonal sales cycles.

You can also choose to have a balloon payment at the end of the hire purchase term of between 10 and 40 per cent of the value of the goods. This balloon payment will reduce your regular repayments, but be aware that you will need to have the nominated balloon payment percentage by the end of the hire purchase term to complete your contractual requirements.

From a taxation perspective, a hire purchase arrangement may be beneficial. As it is deemed as a sale, a GST liability will arise, which you may be able to claim upfront rather than yearly as you make repayments.

The interest rate component of your hire purchase repayments and any depreciation on equipment may also be claimable for taxation purposes.

You should thoroughly investigate the taxation and accounting implications of a hire purchase arrangement prior to committing to this form of finance.

Chattel mortgage

A chattel mortgage is similar to a residential mortgage, except the finance provided is used to purchase vehicles or equipment rather than property.

With a chattel mortgage, ownership of the goods passes to you on purchase, however the title to goods remains with your financier until the mortgage is repaid in full.

A chattel mortgage is particularly useful for any business operating on a cash method of accounting, including companies, partnerships and sole traders, as it allows you to claim the GST component of any vehicles or equipment you purchase upfront.

You may also be able to claim some tax benefits, including depreciation and the interest costs on your chattel mortgage.

A chattel mortgage is generally a fixed interest loan with a one-to-five year loan term, and is generally secured by the vehicle or equipment you are purchasing. As with a hire purchase agreement, you may choose to make a balloon payment or lump sum payment at the end of the loan term, reducing your ongoing repayment amount.

You should thoroughly investigate the taxation and accounting implications of a chattel mortgage prior to committing to this form of finance.

Leasing finance

With leasing finance, a leasing company takes ownership of vehicles and equipment and then leases them out to your business for an agreed repayment amount and term, usually two-to-five years. Leasing finance may be ideal when you need vehicles or equipment that have long effective lives.

As a leasing finance agreement is a fixed rate, fixed term contract, it has the benefit of enabling you to effectively plan your finances over the leasing finance period. Lease payments are also usually tax deductible and you should be able to claim the GST proportion of your payments for tax purposes.

At the end of a leasing finance period, you can often choose to purchase the vehicle or equipment at a price specified in your original leasing finance contract. You may also be able to purchase any leased vehicle or equipment earlier in the leasing finance period by paying out the leasing finance contract and remaining agreed purchase amount.

As with all other types of business finance, you should thoroughly investigate the taxation and accounting implications of leasing finance prior to committing to this form of finance.

*Please note: Rates are subject to change without notice. Full terms and conditions and schedule of fees are set out in the lender's relevant loan contracts.

RedCap Finance Brokers: It is Always Good Financial Practice to speak with your Accountant or Financial Advisor before committing to any business finance or commercial contract.


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Vehicle Loans, Equipment Loans, Asset Finance, Working Capital, Start-up Finance, Franchise Purchase Loans, Commercial purpose loans, or any worthwhile business purpose.