Do I need to provide a deposit for asset finance?
Deposit requirements for asset finance vary depending on the lender, the type of asset, and your business's financial circumstances. Some lenders may offer finance covering up to 100% of the asset's value, meaning no deposit is required. However, other situations may require a deposit ranging from 10% to 30% of the asset's purchase price.
Providing a larger deposit can sometimes strengthen your application and may provide access to a broader range of lending options. However, we understand that preserving working capital is often a priority for businesses, which is why many choose asset finance in the first place. At Capacity Asset Lending, we'll discuss your preferences regarding deposits and present options that align with your cash flow situation. We'll work to find lenders whose deposit requirements match what you're comfortable contributing while still securing the asset your business needs.
What types of assets can be financed through Capacity Asset Lending?
Capacity Asset Lending can arrange finance for a wide range of business assets across various industries. This includes commercial vehicles such as trucks, vans, and company cars, as well as heavy machinery and construction equipment. We also assist with finance for manufacturing equipment, medical and healthcare equipment, hospitality fit-outs, and technology infrastructure including computer systems and servers.
Additionally, we can help arrange funding for agricultural machinery, office equipment and furniture, printing equipment, and many other business-essential items. Essentially, if your business needs a physical asset to operate or expand, we can explore finance options to help you acquire it. Our role is to understand your specific asset requirements and connect you with lenders who specialise in financing those particular types of equipment or vehicles.
Can asset finance help with cash flow management?
Asset finance can be a valuable tool for managing business cash flow because it allows you to acquire necessary equipment without depleting your working capital reserves. Rather than making a large upfront payment that could strain your cash reserves, you make regular, predictable payments over time. This helps you maintain liquidity for other business expenses such as inventory, payroll, and operational costs.
Additionally, because the payments are consistent and scheduled, they make budgeting more straightforward. You know exactly what your commitment is each month, quarter, or year, depending on your payment structure. This predictability helps with financial planning and ensures that acquiring essential assets doesn't create unexpected pressure on your cash position. For many businesses, this approach to asset acquisition supports growth and operational efficiency while maintaining financial stability. Capacity Asset Lending can help you structure finance arrangements with payment schedules that align with your business's cash flow patterns.
How long does the asset finance approval process typically take?
The timeframe for asset finance approval can vary depending on several factors, including the complexity of your application, the size of the finance required, and how quickly you can provide the necessary documentation. For straightforward applications with readily available documentation, some lenders can provide conditional approval within 24 to 48 hours.
More complex applications or larger finance amounts may require additional assessment time, potentially taking several days to a couple of weeks. As your broker, Capacity Asset Lending works to expedite this process by ensuring your application is complete and accurate before submission, choosing appropriate lenders for your circumstances, and maintaining regular communication with lenders throughout the assessment period. We understand that timing is often crucial when acquiring business assets, and we prioritise moving your application forward as efficiently as possible.
What information do I need to provide to apply for asset finance?
To assess your asset finance requirements, Capacity Asset Lending will need information about both your business and the asset you wish to acquire. This typically includes details about your business structure, how long you've been operating, and your financial position. We'll also need information about the specific asset, including quotes from suppliers, the make and model, and whether it's new or used equipment.
For established businesses, we usually request recent financial statements or tax returns to demonstrate your business's financial health. If you're a newer business, we may look at alternative documentation such as bank statements or business plans. The exact documentation required can vary depending on the lender and the size of the finance facility you're seeking. We'll guide you through the specific requirements and help you prepare your application to present your business in the most favourable light to potential lenders.
Can I get asset finance if my business has only been operating for a short time?
While established businesses with longer trading histories often find it easier to access finance, Capacity Asset Lending also works with newer businesses seeking asset finance. Different lenders have varying criteria regarding trading history, with some willing to consider businesses that have been operating for as little as six months to a year.
For newer businesses, lenders typically look at alternative indicators of viability and repayment capacity. This might include the business owner's previous industry experience, existing contracts or purchase orders, projected cash flow, and the business plan. Some lenders may place more emphasis on the personal financial position of the business owners or directors. As your broker, we understand which lenders are more accommodating towards newer businesses and can position your application to highlight the strengths of your business, even if you haven't been trading for an extended period.
How is working with an asset finance broker different from going directly to a bank?
When you work with Capacity Asset Lending as your asset finance broker, you gain access to multiple lending options from various providers rather than being limited to one institution's products. We maintain relationships with numerous lenders across Australia, including traditional banks, specialist finance companies, and alternative funders. This means we can present your application to the most suitable lenders for your specific situation.
Brokers also save you considerable time and effort. Instead of researching different lenders, completing multiple applications, and comparing various offers yourself, we handle this process on your behalf. We understand the lending landscape and know which providers are most likely to approve your application based on your business circumstances. Additionally, we can often assist with more complex or unique financing situations that might be challenging to arrange through a single lender.
What happens at the end of an asset finance agreement?
The conclusion of your asset finance agreement depends on the specific type of finance structure you've chosen. With some arrangements, you'll have paid off the asset entirely through your regular payments, and ownership transfers to you automatically. Other structures include a residual payment (sometimes called a balloon payment) at the end of the term, which you can pay to own the asset outright.
Alternatively, you might have options to refinance this residual amount, trade in the asset for newer equipment with a new finance arrangement, or return the asset to the lender if it no longer suits your business needs. At Capacity Asset Lending, we'll explain the end-of-term implications of different finance structures when helping you choose the most appropriate option for your circumstances. Understanding what happens at the end of the agreement is an important part of selecting the right finance solution from the outset.
What is asset finance and how does it work?
Asset finance is a type of business funding that allows you to acquire equipment, vehicles, or other assets without paying the full purchase price upfront. Instead of using your working capital, you can spread the cost over time through regular payments. This approach helps preserve your cash flow while still gaining access to the assets your business needs to operate and grow.
As an asset finance broker, Capacity Asset Lending connects you with suitable lenders who can provide funding for your business assets. We work on your behalf to find finance solutions that align with your business circumstances and requirements. The asset itself typically serves as security for the loan, which can make this type of finance more accessible than unsecured lending options.
