Why should I spread my lending
Invoice Money is Australia’s leading Independent Specialist Invoice Financier.
Invoice Finance is all we do and we think we’re the best at it.
We do get asked if we offer other forms of finance. Our response has always been no. It’s our belief that SMEs are best suited to spread their lending across multiple lenders.
There are many reasons why to make that spread. Here are the top 12 reasons why:
Diversification: Using different lenders for different assets can help diversify your credit risk. This means that if one lender experiences financial difficulties or goes out of business, you won't have all your borrowing tied up with them, and your other loans will still be safe.
Competitive rates: Different lenders may offer different interest rates, fees, and terms for various assets. By shopping around, you can find the best deals for each type of asset, which can save you money in the long run.
Flexibility: Different lenders may have different requirements for collateral, credit score, income, and other factors. By working with multiple lenders, you can find the ones that are most flexible and willing to work with you.
Expertise: Some lenders specialise in certain types of assets, such as real estate, vehicles, or equipment. By working with lenders who have expertise in each asset class, you can benefit from their knowledge and experience.
Access to more capital: If you need to borrow a large amount of money, you may not be able to get it all from one lender. By using multiple lenders, you can access more capital and spread your borrowing across multiple lenders.
Better terms: By using different lenders, you may be able to negotiate better terms for each loan. For example, you may be able to get a longer repayment period, lower interest rate, or more favourable terms on one loan than on another.
Avoid cross-collateralisation: Some lenders may require you to use one asset as collateral for multiple loans. This can be risky, as it puts all your assets at risk if you default on one loan. By using different lenders, you can avoid this risk.
Avoid over-reliance on one lender: If you use one lender for all your borrowing, you may become over-reliant on them. This can make it difficult to switch lenders if you need to, or to negotiate better terms for your loans.
Better customer service: Different lenders may have different levels of customer service, and by using multiple lenders, you can find the ones that provide the best service for each asset class.
Avoid legal or regulatory issues: Depending on the asset and the lender, there may be legal or regulatory issues to consider. By using different lenders, you can avoid any potential conflicts or issues that may arise.
Reduced risk of loan rejection: By spreading your borrowing across multiple lenders, you reduce the risk of having all your loan applications rejected by a single lender.
Asset protection: By using different lenders for different assets, you can minimise the risk of all your assets being affected by a single lender chasing you for arrears or default on your facilities.
You can make more of your financial standing with the experts who support SME growth by offering a diverse range of debtors’ based finance facilities. These can all be tailored to your individual business needs and to suit whatever your business cash flow finace requirements are on a single invoice, selective, continuous or confidential basis.
There’s no reason to find this daunting or confusing because you have an experienced team who can take you through the process step by step.
Make more of your financial future in the most effective and efficient way. to help sustain your cash flow and meet your business funding needs. See Invoice Money today and make more of your financial future. It starts today. Make the change and Contact Us.