It can be difficult to break into the market and get your small business going, but once you’re on the open road you’ve probably got the mental space to take another look at your finances. The only problem is that years later once you’ve started having some success, you’re still paying the high cost of a startup loan. One of the things you might want to think about is refinancing.
Just as you take a look at your mortgage every 3 - 5 years, you should be looking at refinancing your business loan every 2 - 3 years to make sure you’re getting the best rate.
Why refinance your start-up loan?
The potential benefits of refinancing your startup loan are:
- Gaining a lower interest rate now that the business is more successful and less risky;
- Restructuring the debt so that the repayments match your cash availability;
- Gaining more flexible features in a debt product to meet your business needs;
- Increasing your overall borrowing to give you access to new growth or strategic opportunities;
- Consolidating debts to simplify financials and lower overall repayments (e.g. moving credit card debt into your business loan); and
- Releasing personal or business assets from security arrangements so that they can be used for other purposes (e.g. freeing up equity in your home to enable the purchase of an investment property).
Given the potential repayment, cash flow, and security benefits, it is always smart to check what refinancing can do for you. Best case scenario: you save a lot of money. Worst case: you stay with your current arrangement. You have nothing to lose.
The practical impact of refinancing your start-up costs
Refinancing your startup may require very little effort or a lot depending on the complexity of your current debt.
Some requirements that you should be aware of include:
- Having to change lenders and going through some sort of customer onboarding process with a new organisation will take some time;
- Before shopping around for a new lender it may help to make a list of all the accounts you use in your business;
- The repayment amount or term of the loan may be different, so be ready to adjust to a different schedule;
- You may be asked to increase or decrease the security offered to the lender/s; and
- Getting your head around the different product types offered by various lenders will involve some leg-work.
If you’re ready to refinance, check out Valiant’s small business loans marketplace or have a no-obligation chat to our team of credit specialists.
Nathalie is the Communications Manager at Valiant Finance. She has a double degree in Journalism and Law, and a background in the fintech space, hailing from Asia's largest fintech hub, Stone & Chalk.
Related Posts
Your chances of getting approved for unsecured business finance depends on these 12 factors. Click to learn more.
Click here to learn about your franchise finance options, and compare loans from 80+ Aussie lenders.
Choose wisely with these 7 green flags to look out for.
Time is money. That’s why you should think twice about which bank to go with for your business loan. Or whether you should go to a bank at all...
Denied business finance? What now? Here’s why Aussie business owners are turning to non-traditional lending solutions, and succeeding.
Take advantage of lower interest rates and greater borrowing power with secured business finance. Click to learn more.
A line of credit can take a huge load off your shoulders as a business owner. Click to learn why.
Click to find out whether a secured or unsecured loan suits your business best, and easily compare finance solutions with competitive rates.
Find out whether an unsecured business loan is right for your business, and compare loans from 80+ lenders.
Need cash but don’t have collateral? An unsecured business loan might be your answer. Click here to learn more and make your best business move yet.
Click here to find out which type of commercial finance is right for you, and contact a product specialist to get funding, fast.
Valiant Finance are pleased to announce that we have secured $12.5 million in our Series B equity funding.
Don't get caught out. Here's your Business Loan Checklist to put you in the best position to find funding for your business.
Your guide to applying for an unsecured business loan and helping your business grow.
Put your best foot forward by preparing strong answers to these 4 questions.
A little preparation goes a long way. Get ahead on the finance front with our quick tips to help you with the 3 key areas of your loan application.
Want to reach your customers online? Are you ready to digitise your small business? First up: get smart about social.
Every business is unique. Every business loan is different. What features are most important to you? Consider these 4 things before applying for finance.
Don't get caught out. Here are 5 hidden fees and charges that could apply to your small business loan.
You've explored your business finance options. What do you do next? How can you be sure you're comparing loans effectively and getting the best deal?
Are unpaid invoices causing cashflow problems for your small business? Invoice financing may be the answer.
You're applying for loans, you start getting positive responses, and suddenly you're asked for a guarantee. Don't sign until you read this!
Are you invoicing your B2B customers with longer payment terms? Is it hurting your cash flow? Debtor finance could be a lifesaver between payments.
With so many business finance options to choose from, how do you know whether working capital is right for your business? Start by reading this.
Are you ready to refinance? Reviewing your business loan every 2 - 3 years can save your SME a lot of money. Here's what you need to know.
2018 is your year. Here are 7 quick tips and tricks to get back in the driver's seat when it comes to battling business debt.
Improve your chances of locking down the perfect business loan. Here are 19 business funding mistakes to avoid when you're applying for commercial finance.
Getting the best rate is all about asking the right questions. Have you done your research? Here's where to start and why.
Need to raise cash for your business? We explore the use of debt versus equity, and how to decide which one is best for your business.