BUSINESS LOANS

Intellichoice is committed to offering our business and commercial clients with a range of business loans to suit your specific needs. There are many different business loans available and we will be able to help you decide which option is best based on your needs and circumstances. Whether you are looking for business cash flow assistance, funds to grow your business, need small business loans or need finance for new equipment, we will have a business loan that fits around your own business cycle and events. 

Please note that each mortgage lender has their own programs and requirements and Intellichoice will be able to help you understand the differences between the business loan types and mortgage lenders and the related fees and charges payable. 

Some of main types of business loans include the following: 

FDAs or Term Loans are where the full amount borrowed is advanced to the borrower on day one. These types of loans are generally over longer terms (up to 15 years) and may have fixed or variable rates of interest.

 Business Overdraft

Overdrafts are probably the most common type of finance used by businesses. An overdraft is a line of credit attached to a cheque account, which allows businesses to operate on a day-to-day basis. The use of an overdraft is referred to as 'working capital'.

Overdrafts are charged at a variable rate of interest, with interest being calculated daily on the balance outstanding. The balance of an account with an overdraft facility should ideally fluctuate between debit and credit as cash outflows and inflows occur.

Leasing

There are different types of leases, but generally leasing is used for financing the purchase of assets like cars, telephony, computers, equipment and machinery. It is a popular form of financing as it saves spending the business' capital, but of course the borrower does not own the goods and in effect pays 'rental' to the lender.

The full lease payment is tax deductible if it is 100% business use, but the value of the item cannot depreciate over time. A lease generally requires that a pre-agreed amount (balloon / residual) will be owing at the expiry of the term.

Commercial Hire Purchase

Commercial Hire Purchase is similar to leasing except that the item is seen to be owned by the borrower. This means that only the interest payments made on the purchase are tax deductible. Depreciation is also allowed as a tax deduction. The interest rates on both hire purchase and lease are fixed for the term of the agreement.

Debtor Finance or Cash Flow Finance / Factoring

Australian small and medium sized businesses often find themselves faced with wonderful marketplace opportunities, but may have difficulty growing or expanding their business due to the strict lending criteria of the banks or when cash flow is tied up in unpaid invoices.

An excellent alternative is debtor finance or invoice finance. Debtor finance or invoice finance can help businesses use its sales as leverage to generate the capital demanded by rapid growth and provides a steady and flexible source of funds by turning your unpaid invoices into cash within 24 hours. As well as boosting cash flow quickly, a debtor finance/invoice finance facility can provide greater certainty and clarity for the future of your business. It is a process to grow your business.

Inventory Finance

Inventory finance provides businesses with finance for the acquisition of stock for manufacturing or resale to their clients. Inventory finance is unique in that the stock to be financed does not have to be pre-sold, invoiced or delivered. Additionally, real estate security is not required.

It is a great finance solution for businesses whose financial needs cannot be met by traditional business lending facilities.

By using inventory finance, your business is in a better negotiating position with your suppliers as they are paid in full, upfront and your orders can be larger and more frequent, reducing freight costs. A further advantage is that by using inventory finance, your business retains the title to the stock, providing you with full flexibility in stock usage and sales.

Commercial Line of Credit

Lines of credit facilities let your business borrow money at competitive rates by using a variety of security options.

Business Mortgage Loan

A business loan which is especially suitable for business people who have a residential property to use as security is a Business Mortgage Loan. By borrowing against your residential asset, you can keep your interest rate down and effectively operate in a similar fashion to a line of credit against your residential mortgage and if you wish, combine your working accounts (day to day transactions) and loan accounts into one.

As you are utilising a line of credit, even when you've paid off your mortgage loan, it will keep on working as a flexible credit limit that you can use to take advantage of any other opportunities that might arise.

Commercial Bill

Commercial Bills can be an excellent answer when you need a significant injection of cash - above $100,000. Normal terms are from seven to 180 days with a variable or fixed interest rate.

There are two types of bills - Floating Rate Bills & Fixed Rate Bills. With Floating rates, the drawdown rate and the term to maturity of the bill are agreed at the time of the drawdown. The interest rate applicable is determined by the term of the bill. If the period is extended or rolled over, the interest rate may vary. With Fixed rate bills, the drawdown rate is fixed for the term of the facility and your interest rate remains constant for the term of the facility, which may include several rollovers. With variable rate bills, the interest rate is fixed for each period.

Borrowing via a Commercial Bill facility offers the flexibility to adjust the principal amount borrowed each rollover (or interest payment period) in line with business cash flow requirements, within a specified limit.

Low Document/No Document Loans

If you have difficulty showing documentation to demonstrate your income, or you have limited business financials, a low doc or no doc loan might be a solution for you. Many self employed business operators have difficulty substantiating income or producing full records of their income.

Take the stress out of finding an appropriate business finance solution in Australia and speak to one of the mortgage brokers at Intellichoice and find out how we can help you with your small business loans or invoice finance needs. Call 1300 55 10 45 to speak to one of our experienced mortgage brokers and how we can help you find a business loans solution to suit your needs.