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Can you lease equipment under £1,000 in value?

April 4, 2022/0 Comments/in Blog, Leasing Insights/by Jess Wells-Flint

Can you lease equipment under £1000 in value?

The short answer is yes, however, you may struggle to find a leasing company that will lease equipment under £1,000 in value.

What is the minimum value at which you can lease equipment in the UK?

There are hundreds of equipment leasing companies in the UK and they all have different policies on whom they lend to, the assets they will finance, and the minimum lease value.

Speaking last year to the leasing division of ABN AMRO Bank in the UK, they are looking for lease transactions with a value in excess of £10m. A number of other leasing companies have since changed their lending policy from a minimum value of £5,000 to £15,000 due to the pandemic last year.

Others have a minimum deal value of either £2,000 or £3,000.

Some leasing companies – like ours – can finance values in excess of £500.

Why do leasing companies not like leasing equipment under £3,000?

There are a few reasons. Put simply, leasing companies have to lend money to stay in business. They would have to write 250 £1,000 lease deals to lend the same as a £250,000 deal. For some leasing companies it is a lot easier to find and focus on larger value transactions. These bigger deals are what keeps the business running for many companies.

Even though lease rates are more expensive for small deals, there is a cost of underwriting, processing, and managing a lease deal over its life. Often asset finance and leasing companies will divide their cost base by the number of deals they write every year to get a “cost of loading a new lease deal.” This cost – often around £150- £250 – will mean the leasing company may lose money on small lease transactions, which is why some tend to stay away from these smaller deals.

Why will a leasing company arrange a lease for £1,000 if they lose money?

Leasing companies offer a service to their end user customers, suppliers and brokers. They will make the profit up elsewhere in their lease portfolio with the introducer. It also helps to keep competition out of their account.

Why do WestWon offer leasing for capital equipment values under £1,000?

Three reasons:

  1. Here at WestWon we pride ourselves on quality customer service. Making sure the customer is happy is our number one priority, so any finance needs you may have, we will take care of it, no matter how big or small the deal may be!
  2. Creating and building a relationship with a supplier offering leasing from £1,000 up to £10m. We do not wish a competitor to handle the smaller deals
  3. We are interested in the end user customer base. Those small micro-ease customers can grow and will come back to us for larger transactions later in their business journey.

So how does WestWon make profit on lease transactions under £1,000?

  1. We use echo sign documentation for speed of processing
  2. Also, we collect the rentals via direct debit
  3. We have DORIS, our own inhouse CRM and lease deal processing system that automates as much as possible. This includes everything from data loading to invoicing and API links for cash collection
  4. In the future, we hope to be lending our own money out of our own book, which will enable us to make profit more easily

Contact Us

If you would like to find out more information about whether you can lease equipment under £1,000 in value here, or any other finance needs you may have then please call us on 01494 611 456. Alternatively, you can email us on [email protected]. You can also see more over on our LinkedIn page.

https://westwon.co.uk/wp-content/uploads/2018/10/piggy-bank-seesaw-picture-id499466605.jpg 430 1500 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2022-04-04 09:00:412022-06-20 10:11:31Can you lease equipment under £1,000 in value?

How To Build Your Business’ Credit Quickly

November 24, 2021/0 Comments/in Blog, Leasing Insights/by Jess Wells-Flint

Want to build your business’ credit quickly and efficiently? Follow the steps below and you’ll be enabled to a range of funding.

Throughout this blog, we will be sharing our tips and tricks that if followed, will enable your business to funding and the best interest rates from lenders.

Building your business’ credit plays a crucial role in your company’s funding ability. Whether you operate as a sole trader, LLP or incorporated company, your business has the capability to establish a credit file separate from you as an individual person.

If you operate as a sole trader, it’s important to understand there is no legal or financial separation between you and your business. If that’s the case, when you apply for funding, all activity will be solely tied to you as an individual and reflected on your personal credit reports.

Covid credit score care

There is now extra pressure, now more than ever, to keep on top of maintaining a healthy credit score for your business. Many businesses of recent years have found themselves in need of loans due to the knock-on-effects from multiple lockdowns. So, should your business be put in the position of requiring a loan, in order to keep your business afloat, it is key to care for your credit score.  Not to mention- checking your company’s credit score should be a standard procedure to identify any potential fraudulent activities made to your business’ accounts. Further to this, unfortunately, according to statistics, fraudulent activity has propelled significantly during the pandemic. So catching this any signs of this early can make all the difference before too much injury is made.

5 simple steps

To keep your business and personal finances separate, the first step is to start building credit in your company’s name. If you want to build business credit quickly here are five simple steps:

Step 1 – Choose the Right Business Structure

Making your business a distinct legal entity requires you to select a business structure such as a Limited (incorporated) company, for example.

Once you form your business entity, the next step is to register your business with companies house. This particular step is dependent on your structure and where your business is located. Like many new businesses, your primary address might be in the name of your accountants address. As a first step towards healthy credit, this address will need to be moved to the premises of the business.

Step 2 – Obtain a business registration number.

When setting up the new business as a Limited company you will receive a company registration number from Companies House. This is an eight-digit number assigned to your company. This you will use for things such as filing company tax returns, opening a business bank account, applying for licenses and permits, and applying for business credit.

Step 3 – Open a Business Bank Account

Once you have your registration number, you’ll want to open a business bank account for your company. This is a mandatory step in creating a clear separation between your business and personal expenses.

Your banking relationships plays an important role in your company’s funding potential. Not only does your business bank account serve as a bank reference on credit applications, but it also provides key data that lenders use during any funding review.

Step 4 – Establish Credit with Vendors/Suppliers Who Report

One of the easiest ways to build business credit score is to apply for net terms with vendors and suppliers. As you buy supplies, inventory, or other materials on credit, those purchases and payments get reported to business credit reporting agencies such as Experian or Dun & Bradstreet.

This activity creates your company credit profile and business credit report. After your company has several credit lines reporting, a business credit rating (score) is generated.

Remember, it’s important to select vendors and suppliers that report to a business credit reporting agency. Each relationship you have also serves as a trade reference that can be used on future credit applications.

 

Step 5 – Monitor Your Business Credit Reports

There are a few business credit reporting agencies so it’s important to monitor each of your company credit files. Each agency collects data from various sources and may have different information about your company.

The good news is each of the business credit agencies provide a way for you to update basic information about your business. If you uncover any outdated or incorrect information, you’ll want to contact the agency to make the appropriate change.

With an established business credit report, it is probable that you will get higher credit approvals. Not only this, but better interest rates and repayment terms on loans and lines of credit.

It’s equally important to establish a diversity of accounts. This can be done with other types of business credit such as a business credit card or line of credit. Let these five simple steps serve as a starting point to building business credit for your company.

WestWon offers leasing arrangements for all types of businesses, from new starts to well established businesses. To find out how we can help you, please give us a call on 01494 611 456 or email [email protected].

https://westwon.co.uk/wp-content/uploads/2018/10/growing-plant-on-coins-money-investment-concept-picture-id907280674.jpg 430 1500 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2021-11-24 10:07:302023-11-28 15:39:52How To Build Your Business’ Credit Quickly

WestWon authorised to offer finance under the Recovery Loan Scheme

April 8, 2021/0 Comments/in Blog, Leasing Insights, Loans, News, Uncategorized/by Jess Wells-Flint

We’re pleased to announce WestWon are now an accredited broker of the new Recovery Loan Scheme.

A number of the WestWon team have gone through their first training session yesterday with an authorised provider of finance. As a result, this was done under the British Business Bank backed Recovery Loan Scheme.

About the Recovery Loan Scheme

The Recovery Loan Scheme was launched on the 6th April and is seen as the replacement to the CBIL’s & Bounce Back Government backed loan schemes. It will be in place until the end of the year, however, already people in the leasing and finance sector are suggesting it is likely to carry on into 2022. The scheme can provide up to £10m of funding per business with the following facilities are available:

  • Term Loan
  • Overdraft
  • Invoice Finance
  • Asset Finance

No personal guarantee is required for the first £250,000 borrowed, however the borrower is always 100% liable for the debt. Interest and fees are to be paid by the borrower from the outset. The APR on the loan cannot therefore be more than 14.99%. Full information can be found here.

Hear from others

George Shillingford, the newly appointed Commercial Director at WestWon noted, “An important point one of our funders stated was they are expecting to use the facility where they would normally have rejected an application. However, this is great news to us, as so many companies will be reporting a drop in profits or losses in their 2020 year end accounts, as a result obtaining finance could be harder to find. This scheme will definitely help our clients.”

WestWon CEO, Jeremy Hall added, “We have a second external training session today with another funder we use. We will know how, when and where to offer the Recovery Loan Scheme to our clients. Within the next few weeks, we are expecting a range of financial providers we work with to become authorised. We will be promoting the scheme to a range of the clients we work with.”

To find out more about the Recovery Loan Scheme please speak to a member of the WestWon team on 01494 611 456 or email [email protected]

https://westwon.co.uk/wp-content/uploads/2019/07/close-up-lawyer-businessman-working-or-reading-lawbook-in-office-for-picture-id956243400.jpg 430 1500 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2021-04-08 13:09:092021-08-12 10:46:05WestWon authorised to offer finance under the Recovery Loan Scheme

Should You Prioritise Working With A Finance Company Who Has An FCA License?

March 15, 2021/0 Comments/in Blog, Leasing Insights/by Jess Wells-Flint

WestWon Divisional Director, Richard Porter, explains the role of the FCA in the asset finance space, and why it’s important to use a finance provider who is registered with the Financial Conduct Authority.

Who is the Financial Conduct Authority?

The Financial Conduct Authority (FCA) is a financial regulatory body in the United Kingdom, but operates independently of the UK Government, and is financed by charging fees to members of the financial services industry. The aim of the FCA is to regulate in a way that adds the most benefit to those who use financial services.

This covers key areas such as;

Protecting consumers by securing an appropriate degree of protection for consumers.

Enhancing market integrity, protecting and enhance the integrity of the UK financial system.

Promoting competition, promoting effective competition in the interests of consumers.

What does this mean to you?

From bank accounts to mortgages, credit cards, loans, savings, and pensions, virtually every adult in the UK is a consumer of financial services. So one of the objectives is to ensure an appropriate degree of protection for all consumers.

They monitor which firms and individuals can enter the financial markets, making sure they meet the standards before they are authorised with a FCA licence.

What if a finance Provider is NOT regulated?

If you are speaking with someone who is not FCA certified, that individual or company ‘may’ not have your best interest. They will officially not be following the FCA guidelines, you will have little protection against fraud, your data, and there will be no legal responsibility to you.

Protection – FCA Authorised.

The FCA work to protect consumers in a wide range of ways. They act to ensure firms have their customers at the heart of how they do business, give them appropriate products and services, and put their protection above the firms’ own profits or income.

They supervise how firms work and can stop those that do not meet the standards from carrying out the activities they regulate.

Where they find that firms are not following the rules, they intervene. This may mean imposing penalties, stopping them trading or securing redress for consumers. It also means ensuring consumers receive the information they need in the right way, so they can make the best decisions for themselves.

How can I check?

Most if not all firms that are FCA authorised will have this either on their website or you can also check on the FCA register by searching either the company name or individual. You can find the information here: https://register.fca.org.uk/s/

 

 

WestWon – FCA licence Number 738235

WestWon have over 40 years’ experience within the finance sector, not only are we FCA accredited but we are also registered with the Information Commissioners Office, ICO. This ensure your Data is Protected and not sold or used for any other purposes.  Licence No. Z9936933. Full information on our accreditations can be found at https://westwon.co.uk/company-information/.

For more information or if you are looking for finance that is best suited to you and your needs contact WestWon on 01494 611 456 or email [email protected].

https://westwon.co.uk/wp-content/uploads/2017/10/sq.jpg 2048 2048 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2021-03-15 10:33:512021-08-13 13:37:59Should You Prioritise Working With A Finance Company Who Has An FCA License?

Recovery Loan Scheme – What Does This Mean For Your Business?

March 12, 2021/0 Comments/in Blog, Leasing Insights, News/by Jess Wells-Flint

The Recovery Loan Scheme launches on the 6th April and will run until the 31st December this year, subject to review.

Similar to CBILS, the Government will guarantee 80% of the finance to the lender, hence hopefully making some company borrowing decisions easier.

There are three type of finance, term loans, invoice finance and asset finance.

Term loans

These are available from £25,000 to £10m and are over terms up to six years.  No personal guarantees are needed on loans up to £250,000.

Leasing and Asset Finance

For agreement between £1,000 and £10m per company with lease repayment up to three years.

Will asset finance and leasing companies offer the Recovery Loan Scheme?

Yes. A range of asset finance and leasing companies have already been signed up to the previous CBILS scheme. Many of these leasing companies will apply and be accepted to offer leasing via the Recovery Loan Scheme.

What are the benefits to my company using a lease organised via the Recovery Loan Scheme?

  1. There is a higher chance the leasing company will give you a credit acceptance
  2. No personal guarantees are needed on lease deals up to £250,000

Will the interest rate on a lease using the Recovery Loan Scheme be the same as a normal lease?

Yes.

Can you use the Recovery Loan Scheme and also get the 130% Super-deduction tax relief?

Yes, as long as you use a lease purchase or loan agreement, subject to the normal rules such as your credit, qualifying brand new assets etc.

Can I use the Recovery Loan Scheme if we have already received support via CBILS?

Yes, you can still have access to Recovery Loan Scheme finance, subject to credit and eligibility criteria.

Recovery Loan Scheme Approved lender

WestWon work with a range of approved lenders who can offer funding via the Recovery Loan Scheme. If your business is looking for a Recovery Loan or asset finance, please call a member of our team now on 01494 611 456 or email [email protected]

https://westwon.co.uk/wp-content/uploads/2017/04/business-17610_1920_reduced.jpg 410 1000 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2021-03-12 13:50:482021-03-12 13:50:48Recovery Loan Scheme – What Does This Mean For Your Business?

Does Super-Deduction tax apply to leasing?

March 12, 2021/0 Comments/in Blog, Leasing Insights, News/by Jess Wells-Flint

Unsurprisingly the question we’re being asked the most by our customers and suppliers is ‘Does the Super-Deduction tax apply to leasing?’ We’re also being asked how the relief works and how it can benefit their business.

The super-deduction 130% first year tax relief on qualifying assets is a major boost in the arm to UK capital equipment investment. Announced in the Budget, the scheme runs from the 1st April 2021 until the 31st March 2023.

Let’s take a look at the impact on leasing and asset finance.

How does super-deduction tax apply to leasing?

You should be able to claim the 130% super-deduction tax relief when you sign a lease purchase agreement. From a Corporation Tax planning exercise, the tax position on lease purchase agreements is the same as if you were to pay cash for the asset.

What is the Government / HMRC saying about lease purchase / hire purchase agreements?

The Government has quoted, “Hire Purchase or similar contract must meet additional conditions to qualify for the super-deduction and special rate relief.”

What does this mean? The UK leasing sector is asking for clarification, however, the widely held belief is that you can use a hire purchase / lease purchase agreement and still get the 130% first year allowance tax relief.

What does “qualifying main rate plant and machinery” mean?

Lorries, vans, tractors, computer equipment, manufacturing equipment, solar panels are all qualifying assets. Certain assets are exempt from this scheme.

What does super-deduction tax break mean?

You can claim 130% of what you send on equipment against taxable profits.

Why is the Government doing this?

They are expecting to raise the level of UK business investment by 10% this year and to bring forward other investment.

What is the tax saving impact of super-deduction tax?

A company spending £50,000.00 on assets in a year would get £65,000 of tax relief. At 19% tax, that would mean a tax saving of £12,350.00.

Let’s look at some of the areas where you cannot claim super-deduction tax relief

Is the funder (technical name lessor) able to get the 130% super-deduction?

No

Can you get the super-deduction tax relief on lease rental agreements?

No

Can you get super-deduction tax relief on car finance?

No

Can you get super-deduction tax relief on refinance deals or sale and leaseback?

No

Can the plant and machinery be used or second hand?

No

I am both the manufacturer and customer, can I claim the tax relief?

No, they do not allow related party transactions.

Where can I read more about the Super-Deduction Tax?

The government have published the draft bill this week and can be viewed here.

For more information on lease purchase agreements or to discuss if the assets you’re financing apply to the Super-Deduction tax relief, please contact us on 01494 611 456 or email us on [email protected].

https://westwon.co.uk/wp-content/uploads/2018/10/growing-plant-on-coins-money-investment-concept-picture-id907280674.jpg 430 1500 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2021-03-12 12:09:112021-03-12 13:33:31Does Super-Deduction tax apply to leasing?

How do you value a leasing broker?

October 26, 2020/0 Comments/in Blog, Leasing Insights/by Jess Wells-Flint

It is a question I often get asked on a regular basis, how do you value a leasing broker? For the sake of this blog, I am just going to focus on leasing brokers with less than twenty employees.

Large leasing brokers that have been sold

Many of the UK’s largest leasing brokers have sold out over the years. Wyse Leasing, Syscap, Henry Howard, Kennett, Premier Asset Finance, Lease Direct Finance are just a few of the well-known names.

Selling a large leasing broker is a totally different project to selling a smaller broker with under twenty staff. The main difference being who will be the acquirer? With larger brokers, the target purchaser is a funder or private equity house. Leasing funders and private equity players are often not interested in smaller leasing companies.

Who will buy a small leasing broker?

Firstly, I do not intend to be of offense to the hundreds of hard-working, successful leasing brokers business owners up and down the UK by calling your business “small.” I only use this word to differentiate your business when looking at who an acquirer would be.

Let us look at some key points:

What is the sector you are involved in and do you have a speciality?

A leasing company just doing HGV vehicle leasing was sold to a vehicle insurance company.

A company focusing on professions loans was sold to Syscap, another leasing broker in that space.

A telco leasing company could be sold to a telco supplier. Same applies to IT or office furniture.

It may be a large office equipment supplier or manufacturer would buy your leasing broker to provide them with the infrastructure as opposed to setting up a leasing company from scratch.

A high net worth individual looking to invest his funds in an own book position.

And then there is the obvious answer…another larger leasing company!

In summary to who will buy a leasing broker, sometimes the answer is not as obvious as you think it will be.

What is the value of a leasing broker?

When we sold Wyse Leasing many years ago, the value was mainly calculated as a net present value of the end of term income and then an additional small sum for the brand, which was quickly ditched by the way! An interesting point here, we worked really hard over many years investing into brand development thinking this investment will only improve the value of the company. Take a look at all the brokers who have been sold. Wyse Leasing, Syscap, Henry Howard are just a few well known leasing brands where the company name has been dropped.

More recently, buyers have been valuing business on volume of business written. The more deals done, the more money lent, the higher the value. This is great if you are a funder looking to acquire. The maths is quite simple, XYZ Leasing company lent £50m at 8%, our cost of funds (as the buyer) are 5%, hence we will automatically put on £50m more volume at an additional 3%.

For us, we will look at five key elements:

  • Client portfolio
  • Employees
  • Supplier relationships
  • Funder relationships
  • End of term income

Let’s look at these in more detail.

Client portfolio

How many clients? What sectors, What size of company? Where are they located? What equipment have they financed?

How often have they been called? Was a welcome pack sent out? How much bad debt is there? How many clients have taken payment holidays?

Is there a CRM system in place? Is the data quality high? Does every client have their registration number? Website address? Full contact details?

At WestWon, we have analysed out the lifetime value of a client using averages to work out how many companies repeat order and what on average is the true profit per deal written. Can you do the same?

Sadly, nearly all brokers I speak to do not know the value of a client and do not have a process of keeping in touch with them other than a monthly email.

Employees

How many? Where are they located? How easy/expensive will it be to exit people? Are there great people you can promote? Are there any key salespeople? Have you got all the personnel records? What has been the staff turnover?

What about self-employed salespeople, consultants commission only etc?

Your team has a value, finding good people is hard. I would put a value on each member of staff and then reduce this by any potential liability.

New supplier relationships

Be careful, just because you have an amazing supplier relationship does not mean they will stay should you leave, sell up, retire. I have seen this far too many times when we buy a great business based on a supplier relationship only to see circumstances change when a deal is done to buy/sell a company.

Saying that, good quality supplier relationships will bring in future business.

Funder relationships

Is there a funder you do not presently deal with? If so, who are they and will they add value in your business?

Many years ago, when Wyse Leasing was doing about £5m per year of leasing business with Siemens Financial Services, we bought a small broker who was doing £1m per year with them. This broker was getting better rates than us. We brought this to the attention of the funder, and they reduced our rates, the extra profit paid for the acquisition.

End of term income

This is the real annuity stream. End of term income, being a share of secondary rentals or title in equipment is real future profit.

If you only do business loans, car finance or hire purchase deals, there is no end of term income. This makes it significantly harder to put a value on your company.

Valuing a broker at zero

I spoke to one broker who was looking to retire. He had 400 clients that did repeat order, all on hire purchase agreements. There was only one employee and he was looking to retire.

Clearly, he had fantastic relationships with some of his clients but in the end, I could not put any meaningful value on his company.

Lets recap

We look at the five key points above and drill down into the business seeing where the worth is. For us, top dollar is paid when we can see an end of lease base with funders we know well. Here, we can net present value the future revenue streams and pay a meaningful price.

Author

Jeremy Hall, CEO of WestWon Limited. For further information, help, assistance, or a chat if you are looking to sell your leasing brokerage, please call me for a confidential conversation.

https://westwon.co.uk/wp-content/uploads/2020/10/corporate-pic-scaled.jpg 1001 1500 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2020-10-26 08:56:212021-11-25 10:10:39How do you value a leasing broker?

Will asking for a lease payment holiday period affect my ability to take out a new lease agreement?

September 29, 2020/0 Comments/in Blog, Leasing Insights/by Jess Wells-Flint

Lease payment holiday requests in the UK Over the 30 years we have been arranging leasing and asset finance for 25,000 plus organisations, we typically only see a handful of companies every year asking for a lease payment holiday. Since the outbreak of COVID-19 in the UK, we have seen more businesses applying for a […]

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Will a Bounce Back Loan or CBILS Loan affect my ability to obtain lease finance?

September 15, 2020/0 Comments/in Blog, Leasing Insights/by Jess Wells-Flint

From conversations we have held, many SME companies who have undertaken a lease via WestWon have confirmed to us they have taken out either a Bounce Back or CBILS Loan.  A number of these business owners have directly asked us asked the question, “Will my Bounce Back Loan (or CBILS Loan) affect our ability to obtain lease and asset finance in the future?”

The implications of a Bounce Back Loan on your balance sheet

Let us firstly look at the financial implications on your company balance sheet. (We have assumed you have taken out the maximum loan allowable under the Bounce Back scheme of £50,000.)

You have created a current asset, cash of £50,000. Likewise, you have added a long-term current liability of £50,000. We say a “long term liability” as the loan facility repayments will start in twelve months. Hence your Net Current Assets position will remain unchanged.

Bounce Back loans being an insurance policy or used to reduce existing debt

Quite a few companies we have spoken to have taken a Bounce Back Loan as an insurance policy. They have put this money aside and presently are not using it to fund the business. This makes financial sense and is a prudent thing to do.

Likewise, there are company directors who have used a Bounce Back Loan to clear off an existing company overdraft or to reduce an existing bank loan. Again, there is a clear financial benefit here, you are clearing historic debt down almost certainly at a higher interest rate. In the background, we know that people are using the Bounce Back Loan facility to get out of banking agreements where they have a personal guarantee.

From the perspective of obtaining a new lease, the two options above would not have any impact on your future ability to obtain lease finance.

Using a Bounce Back Loan to invest in your business

We have spoken to other companies using a loan to put down as a deposit on a commercial vehicle. Another company has used a CBILS loan to pay a rental deposit on a new building. Others have used it to buy stock or build a new website.

These are all legitimate uses for the Government backed loan and will not affect your ability to raise new leasing and asset finance in the future. However, we would like to add, we must tell the underwriter:

  1. Have you taken out a Bounce Back or CBILS loan?
  2. What have you used the loan for?

Using the loan to tide you over whilst business income has been reduced

Most companies are using the loan to help cash flow whilst sales and profit are down, again a legitimate and sensible use of the facility.

Leasing companies must lend to stay in business. If they do not lend, then ultimately, they will look to reduce costs and “wind down their lease portfolio.” The job of their underwriters is to look at all prospects customers and ask themselves one simple question, “Will this company be able to afford to make the 36/60 monthly repayments and will they still be in business at the end of the lease term?”

To make their task easier, underwriters now require most lease proposal forms to have a COVID-19 attachment. This is a one-page document that we can help you fill in. Its primary purpose is to illustrate what steps you have taken to keep trading and how the pandemic has affected your business.

So, going back to our original question using this example, will a Bounce Back Loan or CBILS Loan affect my ability to obtain leasing finance? We would say no. However, there is a big caveat here, our job is to positively explain why you have taken out the loan and more importantly, what steps have been taken to protect your business.

Summary

There are many different reasons for taking advance of a government backed loan, some positive and others negative.

All underwriters will take into account the effects on a company’s longer-term cash flow when they have to start paying back a Bounce Back or CBILS loan. Also, not forgetting how COVID-19 has affected the business.

With most new lease proposals, we will look to ask a number of questions around the impact of COVID-19 on your business and if / why you have taken a loan out.

Our job is to arrange finance for your company, our doors have always been open for business so if you have taken out a loan, please feel free to call us for all your leasing needs.

https://westwon.co.uk/wp-content/uploads/2017/10/sq.jpg 2048 2048 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2020-09-15 09:46:592020-09-23 13:14:54Will a Bounce Back Loan or CBILS Loan affect my ability to obtain lease finance?

The Annual Investment Allowance when you lease equipment?

July 27, 2016/0 Comments/in Leasing Insights/by Jess Wells-Flint
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https://westwon.co.uk/wp-content/uploads/2016/03/WestWon-VAT-Full.jpg 1071 1500 Jess Wells-Flint https://westwon.co.uk/wp-content/uploads/2016/06/WestWon-Colour-300x94.png Jess Wells-Flint2016-07-27 06:57:592017-02-17 00:21:35The Annual Investment Allowance when you lease equipment?
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