Sale and leaseback · Refinancing business debt
Sale and leaseback for Refinancing business debt
Business debt refinancing is replacing an existing facility with a new one to lower the rate, extend the term, release equity or consolidate several debts into a single repayment.
How a sale and leaseback works for Refinancing business debt
Where equipment is owned outright, a sale and leaseback releases that capital without interrupting the work the machine is doing. For a business that has spent years paying assets off and is now short of working capital, it converts the balance sheet back into cash. It is a genuine refinance of equity rather than of debt. The cost is that you pay finance charges on equipment you already owned, so it should fund something productive rather than cover an ongoing shortfall.
The cash-flow pattern we plan around
Existing commitments consuming more cash flow than the current trading position warrants, often because facilities were taken when the business was smaller or its credit position weaker.
What refinancing business debt typically fund
- Lowering the rate on existing business debt
- Extending the term to reduce weekly or monthly repayments
- Consolidating multiple facilities into one
- Releasing equity from owned equipment or property
Sale and leaseback for Refinancing business debt: the numbers
| Typical amounts | $20,000 – $2,000,000 |
|---|---|
| Term | 12–60 months |
| Indicative rates | 8.5% – 18% p.a. |
| Repayments | Monthly |
| Speed | 3–10 business days including valuation |
| Documents refinancing business debt usually need | Current loan contracts and payout figures for each facility · 6–12 months of bank statements and latest financials · Details and condition of any asset or property offered as security |
Rates shown are indicative ranges observed across our lender panel for the period stated. They are not an offer or quote. Your rate depends on your business, the lender, the amount, the term and the security offered. The lender makes the final credit decision.
Key terms
Business debt refinance
A business debt refinance is a new facility that pays out one or more existing loans, changing the rate, term, structure or lender, and assessed on whether the total cost improves rather than the repayment alone.
Payout figure
A payout figure is the amount required to close an existing facility on a given date, including any remaining balance, break costs and fees, and it is frequently higher than the balance shown on a statement.
What is sale and leaseback?
Sale and leaseback is a transaction where a business sells an asset it owns to a financier and simultaneously leases or finances it back, retaining full use of the asset while converting its value into cash.
How much can you raise through equipment leaseback?
Financiers generally advance 60–80% of an asset’s assessed market value, based on age, condition, hours and resale demand rather than the original purchase price. A valuation or inspection is usually required.
What is a PPSR search?
A PPSR search checks the Personal Property Securities Register for existing security interests over an asset. Financiers run one before a leaseback to confirm the equipment is genuinely unencumbered and can be sold.