Also called: Master agreement, Asset finance line
Master facility agreement
A master facility agreement is an overarching contract with a financier that sets an approved limit and standard terms, under which individual assets are funded as separate drawdowns. It saves reapplying each time the business buys equipment.
What is a master facility agreement?
A master facility agreement is an overarching contract with a financier that sets an approved limit and standard terms, under which individual assets are funded as separate drawdowns. It saves reapplying each time the business buys equipment.
Example
A civil contractor holds a $750,000 master facility and draws down a $180,000 excavator against it without a fresh application.
Why it matters
It shortens the time from purchase decision to settlement, though the lender can still decline a specific asset.