Refinance your business loan
Many business owners take a “set and forget” approach to business financing – once they take out a loan, they simply continue making regular repayments.
However, just because a particular loan was the right choice for your business once upon a time doesn’t necessarily mean it’s still the perfect fit. Whether you’re searching for a lower interest rate, wanting to access equity in your property or just trying to take control of your debt, there are several reasons why refinancing a business loan can be a good idea.
How do you refinance a business loan?
Refinancing a business loan involves replacing your current financing arrangements with new ones that are more suitable for your business. This could involve consolidating multiple debts into one business loan, refinancing to a loan with a lower interest rate or even accessing the equity in your property.
However, the exact refinancing process will vary depending on your business circumstances. You may need to refinance by doing the following:
- Changing lenders
- Combining multiple debts into a single loan facility or product
- Increasing or decreasing the total amount you borrow
Is my business eligible to refinance a business loan?
The exact eligibility criteria for business loans will vary from one lender to the next, and also on the type of financing you are applying for. However, you will generally need to meet the following criteria:
- Have a reasonably good credit history
- Have been in business for a specified minimum period of time
- Provide proof of your business income, such as bank statements, tax returns and projected cash flow statements
- Provide copies of your loan statements for the past six months (in some cases)
Other criteria, such as being able to provide security for the loan, may also apply depending on your circumstances. Make sure you thoroughly research a loan’s eligibility criteria and put together a comprehensive application. This will maximise your chances of approval and help you refinance a loan that suits all your business borrowing needs.