When Should You Consider Consolidating Business Liabilities?
If your business has been trading for a number of years then it is quite possible that you have taken on one or more liabilities. For instance, your business may have an overdraft facility in place, hire purchase and a business loan or two for a variety of repayment terms and different interest rates.
For some businesses, repaying such liabilities may have become somewhat difficult so now may be a good time to review these borrowings and see if a more manageable alternative is possible. Having said that, even if repaying the business liabilities is not an issue, reviewing them to see if a better deal is available is worth considering.
For instance, a business overdraft facility is usually made available by your bank on the basis that it is used occasionally with the current account fluctuating into credit rather than being permanently overdrawn. However, there are many business current accounts that are permanently overdrawn with a hardcore of borrowing. In which case, a potential solution may be to consolidate the hardcore element onto a business loan and then repay the loan over a number of years.
Your business may have taken on loans over a short-term. If this has meant that the repayments have become difficult to keep up then it may be worth reviewing matters. A potential solution may be to consolidate those loans onto another business loan but over a longer term thus reducing the monthly repayments. Of course, before deciding upon such a route, you may wish to bear in mind that the total amount that you end up paying back could be greater than if you had continued repaying the loans over their existing terms and you may also wish to check if there are any penalties for breaking the potential terms of the existing loans such as if you are on fixed rates of interest.
So, if you wish to explore the possibility of consolidating one or more business liabilities, why not get in contact with us here at Commercial Mortgage Link. We will arrange to put you in touch with a specialist business lending broker who can assess your needs and advise you accordingly.