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FAQs

Below are some of the most commonly asked questions about Credo and Asset Finance.

What is Asset Finance?

If you are looking to buy a vehicle or some equipment for your business, Asset Finance provides the money, on hire purchase or a lease agreement, normally paying the suppliers direct and collecting the repayments over an extended period. The money is secured against the asset itself, not against property etc, and means that your working capital and cash-flow is protected for what it is meant to be used for - growing your business.

What are the benefits of Asset Finance?

In business, cash is king. By paying cash for a fixed asset it puts a strain on cash-flow. By financing your asset, you have more cash left in your business and more control over your finances. After all, the benefit of owning your asset is not instant, the benefit comes in slowly, match this to your repayment period and an affordable monthly cost.

Putting large purchases on your overdraft means you have less cash (working capital) to pay for the expansion of your business, staff, advertising etc, none of this can be financed obviously.

Consider as well, whilst maybe when buying an asset, cash in the business is good, in a few months time, it may not be as good.

Re-financing an asset after the event is a very expensive alternative and a good deal harder to arrange.

Do I actually own the asset?

With Hire Purchase or Car Loan agreements, you get to own the goods by paying a small option to purchase fee with the last payment. You can also sell the goods during the repayment period but you must settle the finance outstanding before or at the time of the sale. We can help with settlement figures. We also are happy to help with the whole process if you require that service, free of charge.

Finance Leases technically never give you ownership, it remains with the finance company. You can sell the goods however, and retain a large proportion of the sale proceeds, typically between 90 and 99%. As the HP above, you can also settle early by requesting a settlement figure. If you never sell the goods, you would be charged a small "peppercorn" rental at the end of the primary period. This is normally an annual charge equal to the previous regular monthly payment. You would be expected to pay this annual charge every year until you get rid of the equipment.

Contract Hire and operating leases give the user no ownership, at the end of the lease you would be expected to return the goods and possibly pay for excess use or mileage and any repair costs to bring the asset up to standard if it is damaged.

Hire Agreements are normally a rental where the supplier or third party takes ownership of the goods at the end of the lease. These types of agreements are normally seen when financing IT equipment and copiers.

How do I know what option is right for me?

At Credo, we have many years experience, not only in all aspects of finance, but in business, the motor trade and even accountancy as well. We have a unique skill set, meaning that our professionals will give you great advice and make sure that you are given the right type of agreement for your circumstances.

This help and advice is absolutely free. Do not hesitate to call one of our friendly advisers on 01603 381955 if you need to talk a prospective purchase through.

How do I get a quote?

Simply call one of our friendly advisers on 01603 381955 or complete the online quote request form and we will get you a quote almost instantly.

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How much can Credo Asset Finance lend?

We can assist with finance for anything from around £1,500 to £15,000,000. Almost nothing is too big or too small. Our average balance is around £25,000.

Why are Credo cheaper than other lenders?

Credo arranges finance for thousands of deals amounting to many millions of pounds. Our lenders give us the rates for the large amounts we give them each year and therefore our buying power means that we can get you much better rates than going direct.

We do not charge any broker fees, our services are completely free of charge to you.

What's the difference between a Lease and Hire Purchase?

The simple answer is ownership however there are also two other main areas of difference.

Firstly the treatment of VAT on commercial vehicles is generally different, with full vat on the cost of the goods payable in advance on Hire Purchase and VAT payable on the monthly payments, spreading the VAT across each rental.

Secondly some leases may become 'off balance sheet', which means that neither the asset nor the liability appear on the balance sheet. Just the net payment, treated as a direct overhead cost. HP is always 'on balance sheet' meaning the asset appears in your Fixed Assets and the balance outstanding in your liabilities. The HP interest is an allowable expense of the business.

Some finance leases, because you have a benefit in the residual sale proceeds, are treated very similarly to Hire Purchase and capitalised as leased assets. Realistically you should speak to your accountant for the best advice specific to your circumstances.

What APR can Credo offer?

The rates we offer depend very much on what you are buying, your credit rating, the age of equipment and the amount you are borrowing. On car loans we offer internet busting rates from 6.9% APR, on variable rate transactions we can get as low as 1.95% over base rate.

Our policy is always to be cost effective, we aim never to lose a deal on rate and on that basis you can trust Credo to offer you a deal that WILL save you money.

My business is new, can I get finance?

Finance for new start businesses is most definitely available. It does depend on your personal credit rating more, the structure of the deal etc. For vehicles, credit is readily available regardless, for equipment it may be harder and the rates may be a little more, or the lenders may require slightly larger deposits, but we have the flexibility and the knowledge to put the case for credit to the right lender first time ensuring we give it the best chance to be approved.

How quickly will I receive finance?

The process is made very simple for you. Service for us is everything and we aim to make the process painless for you. From initial discussions to you taking delivery of your new car or equipment could be as little as 2 days, so whatever you are buying and however quickly things need to be sorted, you can trust Credo to get it right.

How can you help me to provide finance for my customers?

If you sell cars or equipment to customers we can arrange simple affordable finance packages to help you win their business. Visit our we help you sell page for more information.

What are termination rights?

Under the Consumer Credit Act the customer has the right to `Early Termination`.

If there agreement is regulated i.e. if they are a private individual, sole trader or partnership (3 partners or less) and the original advance is less than £25,000 the customer can exercise this option.

You would have had to have paid over half the `Total Amount Payable` ,the vehicle needs to be in `good repair` and you are up-to-date with all the payments on the agreement.

If you have a PCP contract you will need to be under your contracted mileage, at the time of termination and if you have exceeded it you will need to have paid the penalty charge.

If you are thinking of terminating your account you would need to have checked the above against your paperwork and then you will need to contact the finance company in writing to express your right.

If they agree with you they will arrange collection of your vehicle and your account will be settled in full.

This is an ideal way of coming out of an existing finance deal where your finance maybe more than your current vehicle is worth.

If you would like to discuss this further please feel free to contact us on 01603 381955 and we will advise you further.

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Registered office: 85 Yarmouth Road, Norwich, Norfolk NR7 0HF

FCA Registration Number: FRN670710