Refinance

Release Cash From Existing Assets

Asset refinance, also known as asset-based lending or asset-backed financing, is a financial strategy in which a business uses its existing assets as collateral to secure funding.

The assets involved can vary and might include equipment, machinery, vehicles, property, or even accounts receivable. The primary purpose of asset refinance is to unlock the value tied up in these assets to obtain working capital or finance other business needs.

How does asset refinance work?

Identification of Assets: The business identifies valuable assets it owns, such as machinery, equipment, vehicles, or property.
Valuation: A valuation is conducted to determine the market value or equity value of the identified assets. The lender may assess the condition, age, and depreciation of the assets to establish their worth.
Collateralization: The business pledges these assets as collateral to a lender in exchange for a loan or line of credit. The lender then has a security interest in the assets, which means they can take possession of the assets if the business fails to repay the loan.
Funding: The lender provides the business with funds based on the determined value of the assets. The amount of funding typically represents a percentage of the appraised value of the assets.
Repayment: The business repays the loan in instalments, including interest. If the business defaults on the loan, the lender has the right to seize and sell the collateralized assets to recover the outstanding amount.

How can asset refinance benefit my business?

Asset refinance can be beneficial for businesses that own valuable assets but may need additional capital for expansion, working capital, debt consolidation, or other financial needs. This type of financing allows businesses to leverage their existing assets without necessarily selling them outright.