The Forum of Private Business presented its unique view on how businesses can help fund their growth to become more profitable highlighting the option that small businesses with a commercial mortgage can take advantage of.
The business organization also introduced its new Business Growth Fund to members and the public which is a new initiative that is valued at £2.5 billion and is part of the deal that was made between the top banks and the government last year during the autumn months. The aim of the fund is to help out medium businesses valued to be worth between £10 and £100 million.
Senior policy adviser Alex Jackman said that the new imitative is welcome, but that it should not be viewed as a solution to the problem of a shortage of lending that is available to small businesses from banks.
Many small businesses are finding it hard to secure commercial mortgage rates that make purchasing a property worthwhile while others are finding as a result of the credit crisis that they cannot even get approved for funding from the banks creating a problem that has dominated the government and business news for the past two years.
However, for businesses that can find lending options a commercial mortgage is a great way to secure an asset that can later be used as collateral. n addition, it is a great way for small businesses to get out from paying rent that is a straight loss for any business. By getting a commercial loan it may be possible to consolidate business debt into the mortgage via a remortgage or terms or even to use the new available equity to help up date equipment or invest in new products.
Therefore, the Forum of Private Business suggests that small businesses that cannot get the upfront lending they need to expend to consider getting a remortgage of their commercial mortgage if doing so is possible to help fuel proper growth so that capital is available for expansion.
At the very least, this could be a way to get a lower interest rate on debt than the small business owner may be currently paying helping to decrease the amount of debt that the business is operating under to help widen the profitability of the company in question.