Asset loans and used asset finance – what's right for your business?
We all understand that buying cheap does not always equate to the best value purchase but when it comes to finance, the interest rate (particularly in an upwards trending market) is often the primary focus and this can lead to poor customer outcomes. This is because decisions makers often overlook the importance of maintaining positive cash flows in their businesses, especially in relation to their asset loans or used asset finance structures. Financecan be complex and other more important factors like loan structure and terms and conditions can have a much greater impact on cash flow than interest rate.
It’s very common to see businesses with cash flow issues that have poor asset finance or asset loans structures for new assets and used asset finance as the primary cause for this. A typical example of this situation is a customer taking up a very low interest on a new asset (often on dealer a discounted interest rate where the dealer is subsidising the rate by reducing margin) on a term offered of 2 or 3 years maximum. The asset may have a useful life of fifteen years, but in most cases a short term like this does not make sense and won’t be able to generate enough annual surplus to pay off the asset loan and likely lead to cash flow problems in the business.
Poll: Is your nearest emergency department up to scratch?
Concerns have been raised about Nelson Hospital with complaints of lack of staffing and excessive wait times. Do you have confidence in your local emergency department?
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36.5% Yes, it serves us well
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62.7% No, I have concerns
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0.8% Other - I'll share below
Poll: If you could rewind time, would you choose a different career?
It might not be too late for you, but some people look back and wish they had taken a different career path.
If you could go back in time, would you choose something different? Let us know what you would have chosen in the comments below.
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0% Yes
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0% No
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0% Other - I'll share below
Enjoy a year of free fees*
At Ryman you won't pay your base weekly fee for a whole year* when you sign up to an independent apartment or townhouse at a participating Ryman village before 30 June 2025.
That means that you won’t pay rates, water rates, building insurance, maintenance fees and more. That’s great financial certainty.
*Terms and conditions apply.
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