Invoice Discounting In London UK
What Is It?
Invoice discounting… it sounds intriguing to most people, but also rather mysterious. What is it and how does it work? Could it be of use to your business?
In essence, invoice discounting is a short-term form of borrowing in which a lender looks at the unpaid accounts due to your company and uses them as collateral for the loan. The amount of the loan would typically be around 80 percent of all the invoices that were owed that are less than 90 days old (because, over 90 days, there is a chance that they won’t be paid and therefore that the loan might be hard to pay back).
What this kind of borrowing does is speed up the process of getting paid from customers – the lender pays the money, and when the customer pays, the company pays the lender back. The lender will also charge interest on the loan, and usually a monthly fee to keep up with the arrangement as well, so it is important to take this into account if you want to look into how this kind of borrowing could help you. A budget for borrowing is always important. Invoice discounting is particularly useful for businesses working on a high-profit margin, as the additional charges can more easily be absorbed and even recouped through clever pricing.
You should also remember that this kind of borrowing can’t be done if the company assets in their entirety – including invoices – are already being used as collateral for another loan.
For more information on exactly how your company could benefit from invoice discounting, please don’t hesitate to get in touch with us at Bridging Finance 4U on 0800 288 9044 or email firstname.lastname@example.org. We can answer any questions you may have and help you decide whether this is the right option for you.
Residential & Commercial Bridging
Bridging Finance 4U are master brokers and packagers for all the leading bridging lenders and private funders in the UK.
Who We Are and What We Do
Bridging Finance in London, UK is usually used as an interim financing measure until permanent or ‘next stage’ financing is obtained. For example, the sale of an existing residential property may take longer than the required purchase deadline of a new property, bridging finance could therefore be used to bridge the period of time until your existing property is sold, at which point you may have the funds to pay off the bridging loan in full with the property sale proceeds or to use as a deposit to complete on a standard mortgage.
We can also offer finance for both Republic of Ireland and Northern Ireland. In some cases finance can be also obtained for prime locations in Europe for UK nationals whether living in the UK or overseas as an expat.
Why Choose Us?
Standard terms vary from lender to lender, but in general bridging finance is usually available for a period of between 1 and 24 months. It is sometimes possible to agree an extension beyond 24 months in some circumstances, but generally speaking bridging loans are meant as a short term financing measure, lasting months not a few years.
Instead of going to every lender on the market, just come to us, we do all the hard work for you. We have relationships with all the major lenders and private funders and speak directly to decision makers. Funds can be normally released between 3 and 10 days subject to legals.
We can usually obtain terms immediately and formal offers subject to valuation within 2 hours. If you are looking for speed and service then you have found the right company. Rates from 0.65% pcm but see our rates page for more info. We can also now lend on the value of Freeholds.
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Invoice Discounting UK London, Belfast, Manchester
Invoice discounting is a form of invoice finance, where you can borrow money against the value of your unpaid invoices. Unlike invoice factoring, you have full control over your sales ledger. The invoice discounting company in London may release funds up to 90% of the total outstanding invoice value while you wait for your customers to pay the invoice amount. The remaining 10% is paid when your customers complete your payment. Another way of looking at invoice discounting is that it is a short-term bridging loan which involves invoices as security.
Invoice discounting is a confidential form of invoice finance. Meaning, the money you borrow from the invoice financing company remains confidential, and your customers wouldn’t know that you are taking help of the finance provider. You will continue to follow up with your customers. Unlike invoice factoring, you don’t sell your invoice to the finance company, but you have to deal with your customers all by yourself.
Invoice Discounting Costs UK London
Invoice discounting is generally used to speed up the cash flows. When your client requests to pay the invoice within 30 to 90 days, but you cannot wait since you have bills that need to be paid. The invoice discounting, in this case, helps you get cash instantly when you submit your invoices. This is the fastest way to recover from the irregular cash flow, make supplier payments, pay employee salaries and reinvest in your business.
Although choosing invoice discounting largely depends on the business size and how you want to manage your sales ledger capitals, but it is often suitable for large businesses that own a large number of human resources. BridgingFinance4U is a specialist invoice discounting broker that serves all types of business owners looking for fast and low interest loans. Contact us today and we will ensure you enjoy smooth cash flow in your business.