Key questions to ask when seeking business finance include :
Are taxes, superannuation and other statutory payments paid to date?
- Have financial accounts (i.e. balance sheets and profit-and-loss statements been finalised? (Lenders require a minimum of 2 years of the latest financials to assess any business funding).
- Are there any interim Management Accounts?
- What is the purpose of the finance? i.e. working capital, capital expenditure or debt consolidation?
An experienced finance broker can analyse the financials and requirements to work closely with accountants to structure the funds required. Funds type can then be ‘matched’ to clients’ needs.
For commercial property finance, key questions to consider include :
- What is the rental income?
- What are the terms of current and proposed lease?
- Is there any need for repairs and major works?
- What is the entity of the purchaser, whether company, individual, trust or SMSF?
When seeking a Commercial Property Loan, borrowers should be aware of ‘notional term’ and ‘standard term’. Some banks use the 15-year standard term to calculate loan payments while committing to an actual term of 1 to 5 years. The loan is amortised over a 15-year term, yet the commitment is only for 5 years.
If you need help to secure a business or commercial property loan, please talk to Paul today.