Equipment leasing and finance
Asset-based revolving lines of credit range from $250,000 to $3 million.
Most companies qualifying for an Asset Based Loan will be B2Bs (business-to-business) in manufacturing, wholesale, distribution or business services generating commercial accounts receivable.
In most cases, annual sales range between, $4 to $25 million. The due diligence period for lines of credit approvals are often 20 to 30 days and require the following:
Asset-Based loans provide businesses with immediate funds and ongoing cash flow in the form of a revolving line of credit based on a percentage of the value of the company’s assets, such as commercial accounts receivable, inventory, and machinery & equipment. Interest is calculated on the funds advanced. This business funding can greatly assist a company in growth stages and is an alternative for small business lending.
Many companies use Asset-Based Lending as a constant source of working capital and borrowers only pay interest on the funds they draw. Companies also use Asset-Based lending when they haven’t been able to secure financing through traditional lenders for a multitude of reasons.
Top 5 reasons companies choose asset-based lending
Optimize working capital
Support continued growth
Take advantage of opportunities
Need for flexible and customized package
Unable to get traditional financing