Tradesmen finance options

Burgeoning demand for their services and a general shortage of the necessary skills mean that some tradesmen are able to earn six times the UK’s national average wage, according to a report by Simply Business on the 19^th of September 2017.

Like any small to medium-sized enterprise (SME), however, the successful independent tradesman is from time to time likely to need access to additional external finance. It might be required for:

• meeting a temporary shortfall in your cashflow;

• purchasing additional tools and equipment;

• advertising and marketing your skills and services;

• seizing an order or commission that is too good to miss; or

• expanding your business.

Faced with any of these or other opportunities, what are your options for tradesman finance?

Tradesman finance

As a busy and hardworking tradesman, when you want to borrow money for your business, you want to do so as simply and in as straightforward a way as possible, so that the requested funds are available to you as fast as possible.

To achieve that end result, you are likely to need a lender who goes out of their way to understand your business – a lender who may have been directly involved in running a small business themselves. That means a lender who is prepared to work with you in assessing the appropriate business loan to meet your current objectives, within your existing financial constraints.

Your options for tradesman finance then become a question of deciding how much you need to borrow over what period of time. Typically, business loans for tradesmen may be available from as little as £5,000 or so, right up to a maximum of £100,000. The critical issue of the cost of that credit also needs to be taken into account.

Some specialist lenders may be prepared to express that cost of credit as a single fixed sum, including all the interest and fees, together with the amount borrowed, repayable in equal instalments over the agreed term of the loan. That gives you the certainty an knowledge likely to make managing the repayments and your ongoing cashflow considerably more straightforward.

Nevertheless, you are still likely to appreciate flexibility in any schedule of repayments. If you encounter further cashflow or other temporary difficulties, for instance, you might need to delay or reschedule repayments. Some lenders are sufficiently sympathetic to such requests, discuss with you any alternative arrangements available and impose no financial penalty for the changes made.

On the other hand, if the tradesman finance you secured successfully boosts your business, you might want to clear the outstanding loan ahead of time and repay the balance early. You might want to choose a lender who allows that course of action without imposing any penalty.

Speed

As a tradesman, you are likely to be working in a challenging and fast-moving business environment – you want decisions about any borrowing to be made quickly.

To meet these demands, it is now possible to make an online enquiry about borrowing the amount you need, over a chosen period, and to receive a decision in principle almost immediately.

If your request for tradesman finance is approved in principle, this is followed by the lender’s consideration of a formal application, to which a decision may be given and the funds transferred electronically to your business within little more than 48 hours.