Asset-based lending is an increasingly popular option for small business owners who need to access capital quickly. As opposed to traditional bank loans, asset-based loans use the value of a company’s assets as collateral instead of its creditworthiness. This type of loan can be used for many different purposes, including working capital needs and equipment purchases. If you’re considering this type of financing for your small business, here’s what you need to know about asset-based lending and how it can benefit your organization.
How Asset-Based Lending Works
An asset-based loan can provide small businesses with the funds they need without the lengthy approval process associated with other types of financing. When applying for an asset-based loan, you don’t have to provide a detailed business plan or long-term projections. Instead, lenders use the value of your company’s assets, such as accounts receivable and inventory, to evaluate your application. This makes it easier and faster to get approved and access capital quickly.
Better Financing Amounts
Unlike traditional loans, asset-based lending also allows you to borrow more money than what’s available in a standard bank line of credit. Asset-based lenders often offer up to 80% of eligible collateral values while banks typically offer only 50%. This higher percentage makes it easier to access the funds you need without taking on too much debt.
A Variety of Options
In addition, asset-based loans are available in a variety of different forms. From revolving lines of credit to term loans and invoice factoring, there’s an option that can suit your business’s needs. This provides greater flexibility and allows you to choose the type of loan that best meets your company’s requirements.
Ultimately, asset-based financing is an attractive option for small businesses because it helps them secure capital quickly and easily without having to jump through unnecessary hoops. With more flexible terms and higher borrowing limits than traditional bank loans, asset-based lending could be just what your organization needs to grow and succeed. Synergy Commercial Funding offers a variety of asset-based solutions to businesses. Contact our team to get the financing you need.
Are you looking for financing options for your business? If so, Synergy Commercial Funding is ready to help. We offer a wide range of commercial finance services to help businesses of all sizes achieve their objectives, whether it’s purchasing new equipment or purchasing a new commercial property.
Interested in creating a second line of income just by talking with your existing network? Want to help the economy grow by helping businesses around you grow? Think about becoming a Synergy Commercial Funding Partner. Visit our "Referral & Broker Program" to learn more.
