As a Finance Broker, I often hear the same question “what’s the best interest rate?”. After asking a few key questions, we typically find what the customer is seeking and the initial interest rate question will shift in its level of importance.  It does however lead to a good point, how important is interest rate?

For example; a customer is within the first 24 months of his business journey, we receive a call with the leading question – what’s the interest rate? Before we are able to provide an accurate answer, like all Finance Brokers, we need to obtain the below vital information:

  • How long has the business been operating?
  • If interested in equipment funding, what are the equipment details?
  • Are you a property owner?
  • What is your credit history like?
  • Most importantly: details on personal and business plans for the next 2-5 years.

The reason we ask the above questions is that they each can have a significant impact on the customers future plans. The wrong finance option may not align with plans for the future.

A few scenarios where this has been proven are:
A customer may expect to require additional funding in the near future. In this case, we may offer ‘Off-Balance Sheet’ options.
Or the customer may be exploring the structure of the business and their services. In this scenario they may prefer a shorter term product or even a finance product that has the option to return equipment. If we locked the client into a 60 month term, it could potentially put their success at risk.
On the other hand, if the client is well-established and has a stable business model, a more mainstream finance option may be suitable.

Every business has different requirements and if a business owner was to ask themselves “does my business look different today than what I visualised 2 years ago?” the answer is likely to be YES! Business circumstances change and often you will need flexible finance options.

So, what’s the answer? When using your preferred Finance Broker, take the time to share what your future plans are. Discuss your FUD Factors (Fear, Uncertainty and Doubts). Good Brokers want to retain your business long term, so the more they understand about your plans for the future, the better the service is that they provide.

Interest rates are part of the decision, but the right finance product is even more important.

Bizpal Services offer over 25 finance solutions, suited from start up to well-established businesses. Feel free to call us today for a no obligation chat on 1800 011 981.

 

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Kelvin Marks, Managing Director

 

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