Is your take on commercial finance based on a myth? Read on to find out!
The UK financial market is among the largest in the world. It’s been growing every year, giving millions of people an opportunity to build enough wealth to fund their dreams. With big money, however, come big myths.
At Commercial Finance Network, we regularly come across borrowers who are genuinely worried and apprehensive, all thanks to these distorted truth and outright lies. So, we’ve decided to run a series of blogs that will, we hope, help dispel these myths.
This is the first entry in that series. You may want to visit and bookmark our blog for when you want to return. You can also sign up for our incredibly useful newsletter that will keep you posted about the latest news, updates and articles from the world of commercial finance.
Myth #1. Private/Alternative Lenders Are Always “Predatory”.
This is probably the most common myth of them all. Most entrepreneurs and young businesses have little to no experience of making commercial finance work in their favour, and, as a result, they end up relying heavily – almost too heavily for their own good – on whatever finance options they come across first. These, as you can guess, usually happen to be big banks and high-street lenders.
So, if and when banks fail to give them the deal they want, they either shelve their projects, or turn to alternative lenders as the last resort, but not without a great deal of apprehension.
This is something that will take years to change but change it must!
If you can keep your options open, you can always find alternative lenders who are willing to offer you quotes that are far cheaper, more flexible and faster than the ones you’d receive otherwise. While it’s true that there are many lenders out there who run predatory practices, it’s important to know that when you work with reputed brokers like Commercial Finance Network, you shield yourself from such threats.
Myth #2. I’ll Just Exhaust My Personal Credit Cards First. That’ll Be Cheaper.
When you’re looking to finance business expenses – they can range from buying a property to funding refurbishments or exiting an active project – it’s very tempting to use the most accessible options first up.
Consequently, many business owners, even before they approach us, have already used up all their personal credit. This includes exhausting credit cards (often, including their partner’s) and stretching personal savings thin. This approach may even work in certain cases, especially when you are confident of establishing a firm source of revenue/investment soon.
But when you aren’t, it may just be better (and often cheaper) to turn to commercial finance for business needs.
Personal loans, more often than not, are small, short-termed and unsecured loans. They can take care of unexpected, emergency expenses, but that’s about it. They have, time and again, proven to be incompatible with business needs, despite an apparent rise in their popularity.
So, in summary, don’t stay under the impression that a personal loan can be a good alternative to commercial finance.
Myth #3. Commercial Finance Is Not For Those Who Have Bad Credit.
A misconception, more than a myth. This false notion cuts across all commercial finance products, holding back many businesses that shouldn’t even be worrying about bad credit to start with.
It’s true that lenders do and will check your credit file. It’s also true that much will depend on your credit history. What’s not true, however, is that not everything depends on your credit file.
Many lenders specialise in working with individuals and businesses with bad credit. Such products may be a touch more expensive and may require additional security, but they can certainly help in the hour of need.
At Commercial Finance Network, we have a panel of specialist lenders who offer adverse credit mortgages to applicants across the UK.
Myth #4: We Can’t Afford To Wait This Long.
Everybody wants things to move fast, and that’s a perfectly reasonable expectation.
It’s undeniable that commercial finance used to move at a snail’s pace a few years ago. Thankfully, things have changed for the better (we, at Commercial Finance Network, have been at the forefront of this change).
When you work with an experienced broker, you can make things move really fast. For example, every commercial finance product that we broker is designed to take shape at an industry-leading speed. In essence, now is the right time to do away with the misconception that commercial finance is slow and sluggish.
Myth #5: It All Seems So Complicated!
It probably does, and we don’t blame you for it, at all.
Brokers and lenders have a track record of complicating commercial finance products to such an extent that they appear puzzling – especially to first-time borrowers. There are far too many numbers to process, making the whole process a winding dread.
But we’ve got good news. There are experts out there willing to understand your requirements and make these products work for you. Thankfully, we’ve got the best among these experts on our board – and they’re here to help you. When you apply for commercial finance using our portal, we make sure that you are always in charge, and every little detail is explained to you. There’s no room for confusion and there’s no scope for ambiguity. You get what you see.
In Conclusion: Explore Your Commercial Finance Options Bravely, They’re Always Worth It.
Commercial finance is indispensable. Once your business grows past a certain stage, using your personal savings just doesn’t cut it. You’ll need more robust, customised and cheaper financing options that will also be scalable.
Don’t be bogged down by the intricacies of commercial finance. Explore your options freely and make the most of your creditworthiness to fuel the growth of your business. To know more about how our commercial finance services can help you, please contact us here. You can also call us on 03303 112 646 to request a prompt call back.