FAQs

To successfully qualify for Invoice Financing, you need to be a B2B business that sells goods or services, and your eligibility ultimately relies on your invoices. Invoice Finance is all about the future growth and potential development of your business, rather than your company’s previous credit history.

This also makes it a good choice for start-ups with some lenders as they’re willing to finance your first product.

There are two main types of invoice finance which are Factoring or Discounting. Invoice Discounting is a facility whereby all collections is kept in house, so your customers are not aware that your invoices are being financed against them. Due to these factors, Invoice Financing is typically more expensive, however if you don’t mind your customers knowing that you are employing Invoice Factoring, this can have massive cost benefits.

No, you don’t have to finance all your invoices and although some lenders may insist on this, the product can be cheaper if you factor all of your invoices compared to when you factor just a few. Invoice Discounting is most effective when financing the odd or select invoice as and when needed.

Typical terms of a Merchant Cash Advance will be set to be repaid in around 3-12 months, however You only have to pay as a small percentage of your future revenue from card payments each day therefore if your card sales drop it extends the term of repayment, on the other hand, if they increase then the term will reduce.

The terms and conditions of a Merchant Cash Advance mean that you only pay the loan back when you get paid from your customers and in proportion to the turnover of the business.

Typically, the only documents that you would be required to send are identification, 3 months bank statements and 3-12 months’ worth of PDQ card statements. The turnaround time for funding is anywhere from the same day to 5 working days, but on average it is 48 hours.

All lenders in the commercial finance industry offer varying conditions and expenses, but generally you can raise up to 150% of your average monthly card sales volumes.

To obtain a start up loan you must be at least 18-years-old. In addition, you must be a UK resident with the right to work in the UK. Elite Business Funding can source start up funding for UK based businesses who have been trading for no more than 24months. They also need to pass the basic credit checks.

You can borrow anywhere up to £25k based on your business plan or turnover in your first year of trading. For partnerships, each individual business partner can apply for £25k and the maximum combined is £100k. Each partner will be formerly assessed separately, and each will be required to sign a personal guarantee.

The businesses that aren’t eligible for, and are restricted from receiving start up finance include; Weapons, Banking and Money Transfer Services, Chemical Manufacturers, Gambling and Betting establishments, Property Investment, Pornography, Drugs, Private Investigators and Agents for 3rd parties.

Start-up loans are designed and aimed at financing costs of newly developed and growing businesses. Therefore, it can’t be used for the following uses; Refinance and debt paying investments, especially if they are outside of the business, for personal uses or training and qualifications.

With leasing you only need to make a monthly payment, which is the same case for rent and wages. This means the capital you would have used to buy it outright can now be used for other business needs/expansion and can help with your cash flow, accelerating growth. There are also great tax benefits and VAT can in some circumstances be claimed back.

Asset Finance can help to reduce your overall tax bill due to the cost of leasing being deductible as a business expense. If you expect to own the asset at the end of the term, this will be considered as a supply of goods and therefore, VAT will be due on the entire expenses and amount.

In cases of hiring and leasing where you won’t own the product at the end of the term, VAT may be charged periodically due to this being a supply of services not goods.

It is possible to refinance or join a new lease whilst you are involved in an existing agreement, however you must be approved by the lender on your eligibility for asset finance with a new fixed completion date settled. In addition, if you are looking to upgrade any of your leased assets during your finance contract, contact us and we’ll discuss this in further detail.

With asset finance you can only claim back allowances for leases that are bought via a hire purchase and within a long-term leasing contract. You are not able to claim capital allowance back for shorter leases which are typically borrowed for less than 5 years. Also, as it is a trading expense you can deduct the full cost from your taxable profit.

Compared to most finance options, unsecured business loans are most appropriate for companies that require finance quickly, are typically not asset rich and are unable to provide security. To discuss the options available please call our experienced advisers.

The size of the loans available will depend on your business’ criteria, however we have access to a wide range of finance companies who can lend from £3k up to £500k, depending on your business’ financing circumstances. If you are a homeowner for example, this can dramatically increase and impact the amount you qualify for still without needing to offer security.

This is not always the case as many lenders will consider and assess people with adverse credit and even CCJ’s and defaults depending on the circumstances. Lenders will often assess both the background of the company, as well as the reliability of the director.

In addition, if your business has more than one shareholder, one with adverse credit and one with good credit, this is allowed by most lenders. Many lenders will only use a soft credit search to pull and assess your credit file, that only leaves a footprint and therefore doesn’t affect your credit score in anyway.

One of the most beneficial features of Unsecured Finance is the reality that with most lenders, you can use the finance for whatever you need as long as your business has a strong affordability. A few uses are expansion, equipment purchase, general cash flow, paying large invoices and HMRC bill, as well as bridging payment terms for invoices work, plus many more…

Most businesses will usually look at a secured finance as they usually offer very competitive rates. It is also generally a longer-term finance option, which results in a lower monthly repayment easing cashflow. While the turnaround time can be longer due to the security of the asset being offered you can typically borrow more money than that with an unsecured loan option.

If you have lots of assets, and are looking for the cheapest option with lower monthly payments, this is the most suitable option for you and our business.

A secured business loan is perfect and the most appropriate option for asset rich companies that need to release/raise cash-flow for their business. This finance solution is usually easier to qualify for, and are well-suited to established business that typically seek longer-term finance.

As the loan will be secured against an individual or company assets, the credit criteria is usually a lot more relaxed and less intrusive, in comparison to other finance, meaning the minimum credit score will often be lower.