Banks slow to fund your business acquisition? Try this

Avoid delays

Keep your business purchase on track.

The team at Influx Funding have dozens of conversations with clients every day and it’s from this vantage point that we can identify the issues affecting business.  Unsurprisingly, a trend has emerged relating to unacceptable delays in obtaining credit feedback from major banks.

We’ve arranged finance for many clients who acquired another business, all were mired in delays and were unable to obtain a decision from their bank in a timely manner; positive or negative.  The reasons and excuses are numerous and sometimes humorous, but behind all this is a client who has decided to expand via acquisition.

It’s a big deal and a very challenging time for the acquirer, in addition to keeping their business running smoothly, they must win a paper war with their bank while maintaining composure in dealing with multiple parties; bankers, lawyers, accountants, business brokers, not to mention the principals and staff of the target business.

Everyone in business understands that due diligence is critical.  It all takes time, but what is unacceptable is banks that over-promise and then fail to deliver to a timeline.  Sure, it’s preferable to obtain funding from your bank, the interest rates are often lower and the loan can be repaid over a longer term; however, a finance applicant should not be entangled for 6-8 weeks without a decision.  We even encountered a scenario where the bank just ceased communicating.

Fortunately, business owners can bypass extended delays by arranging a Secured Business Loan, then refinance the facility back to the bank.  This is most suitable where a positive decision is imminent, and the new loan facility gives the bank the time they need to get their house in order.  Yes, you’ll need to make an allowance for that.

This funding is readily sourced from the Alternative Finance market. Never heard of the Alternative Funding market?  It’s a group of small and nimble banks, financial technology firms and private financiers who have stepped up to fill the void and help small business bypass the rigorous and archaic processes of the banks.

With a Secured Business Loan the interest rates are higher and the one year term shorter compared to bank funding; however, in our client transactions, the decision was simplified to one whereby the funding was needed urgently before the selling party walked away.  At Influx Funding, we can arrange facilities where there is no early repayment fee, so you can agree a one-year term and then refinance and repay the bridging facility in three months.

It is possible. Our extensive panel of lenders understand the importance of timely delivery and assess your situation with flexible credit policies.  Often decisions are returned within three business days and transactions are completed in 2-4 weeks.  Don’t be held back.  The Influx team are experienced and ready to manage business purchase transactions without delay.

Let’s have a chat to explore your options, contact Influx Funding today to discuss how we can support your next business purchase.  Nothing ventured, nothing gained.