The ease of a single asset finance facility

An asset finance revolver is a finance product that combines all plant and equipment borrowing into one facility. It provides a pre-approved credit limit ensuring the smooth introduction of updated equipment into your fleet without the hassle of repetitive requests to your lender. Administration and documentation is easier with one combined monthly interest charge and one monthly statement. Most revolving credit facilities allow you to use excess working capital to offset your lending balance, which reduces interest costs. For example, seasonal income or monthly cash fluctuations can be deposited into the facility and used later as required.

Why should my business consider a revolving credit facility?

• A pre-approved credit limit facilitates the addition of newly acquired and used assets to your fleet, or allows you to borrow against assets you already own.
• Surplus cash can be paid into the facility and used to reduce your monthly interest cost. In addition, you can retain the flexibility to redraw the cash again as your business requires it in the future.
• Assets can be repaid and removed from the facility without incurring early repayment penalties or break costs.
• Administrative load is reduced by having one monthly statement, rather than managing multiple term loans.
• Revolving credit facility monthly statements are transparent, providing you with visibility of the lending value and monthly principal reductions on an asset by asset basis.
• Asset repayment terms are set on an asset by asset basis, ensuring each asset is repaid within its working life.

Which lender offers the best facility?

While each lender has their own products and lending criteria, we will assess your business requirements and financial objectives. We will work on your behalf to match you with a lender that has the best product solution for your business.

Considerations

• Revolving credit facilities are structured on floating rates, which may fluctuate over the life of the asset and are currently higher than many available fixed rates. This can be mitigated by funding a portion of a fleet on fixed rate asset finance term loans separate from the revolving credit facility.
• Facilities are subject to annual review by the lender. The lender may alter the facility terms at an annual review.
• The initial set up can incur one off establishment costs including lender documentation fees, fleet valuations and documentation via a solicitor. These facilities generally do not attract a line fee that lenders often charge for revolving credit products.
• Ongoing annual fees are negotiated upfront and are generally very low.
• Genuine revolving credit facilities are only available through main bank lenders, and a small number of finance companies. These lenders will typically have a lower appetite for risk, and are more likely to support well established businesses with strong profitability, lower debt to income ratios, and stronger balance sheets.