How Naritas can boost your business
Are you operating a business that is more than 3 months old? We have a diverse range of both unsecured and secured business finance products that can easily help your business to thrive.
The age old question: What to offer as collateral?
One of the basic tenets of work/life balance is: ‘Don’t bring your work home with you.’ But what if you could bring your home to work? It’s a scenario that home owners with a business should consider when seeking commercial or asset finance. Why? Sometimes the more security you can offer a lender, the lower the interest rate it will charge and vice versa.
As with mortgage rates, commercial and asset finance rates will vary from business to business. Lenders will look at things such as industry volatility, how long you’ve been in business and your financial records to determine the risk factors that will contribute to their loan terms. A Naritas credit adviser can offer an unbiased view on whether your property or business assets are suitable to be used as security, how much equity you can use and how this might affect different loans from different lenders.
What are the most common types of business finance available from Australian lenders?
Business lines of credit: The lender loans money to the business for its operations and the business repays the lender with interest. Business lines of credit are typically uncollateralised or collateralised against business assets such as property or receivables. Business lines of credit from banks are typically quite slow and difficult to get approved for, whereas business lines of credit from non bank lenders can be relatively quick and easy to establish – even for businesses as young as 3 months old.
Commercial investment loans: the lender loans money to the business to invest in an asset, including real estate. The asset is often used as security and the repayments attract interest.
Chattel mortgage or equipment loan: The lender loans money to the business to purchase equipment or vehicles, which are used as security. Repayments attract interest. When it comes to purchasing an asset, lenders will often use the asset as security against the business’ debt. In some cases, however, such as with the purchase of equipment or vehicles where the assets may depreciate over time, the asset itself may not be sufficient security.
Invoice or receivables finance: The lender lends the business up to 100% of their invoice’s value upfront. It allows the business to access the money owed instantly. Funds can be in the business account within 24 hours.
Unsecured loans: In other cases, for instance when a business seeks a loan for operational needs, there may be no security. Unsecured loans often attract the highest interest rates. If you’re a home owner with equity in your property, you may be able to use this equity as security to leverage a better rate on your business loan.
Looking for advice or assistance with an approval?
The team at Naritas are experts in delivering timely guidance & finance approvals. We have over 100 lenders on our panel & a high quality team of dedicated credit advisers to steer you efficiently through the approval process.