Financial products can be confusing, and as there are so many different options available, it isn’t always easy to know which is going to be best for you. It can be worthwhile to seek the help of an experienced professional who will have the knowledge, skills and contacts to get the very best finance deal for your business’s individual situation.
A business finance broker will know a great deal about how to get the best funding and how to give your business financial flexibility. If your business is in a complex financial scenario, or you are just unsure which types of lending will help your business grow; then a commercial finance broker will be able to help. We’ve shared our top reasons to use a business finance broker, as well as some top tips on how to best fund your business growth.
What is a business finance broker?
A business or commercial finance broker is an individual or a company that specialises in matching individuals that have specific funding requirements with the best types of finance for them. Unlike with direct lenders, brokers do not use their own finance to offer loans or finance agreements.
Instead, they find the best lenders for the business situation and arrange the finance agreement on your behalf. Most business finance brokers will have a wealth of experience in finding funding for various business needs and will be able to use their skills and knowledge to find the best options for a company.
Some business finance brokers will specialise in specific types of lending. For example, some might specialise in bridging loans, while others specialise in HMO mortgages. If you know the type of finance you require, it can be worthwhile finding a broker that specialises in this area.
Why use a business finance broker?
Many people often wonder why they should pay a broker to organise their business finance when they could go directly to the lender. There are various reasons why using a business finance broker can be hugely beneficial:
- Expert knowledge: Business finance brokers are legally obliged to hold a relevant qualification or be accredited with a lot of experience in the field. They are guaranteed to be professionals with plenty of experience and knowledge in their area. Finance brokers constantly keep up to date with the relevant markets and will stay updated and in contact with a range of lenders, so they are always in the loop to find the best deals.
- Exclusive access: Some business finance brokers will work alongside lenders to offer exclusive deals and finance agreements. Many lenders will provide brokers with exclusive offers and the very best lending deals, in return for them finding suitable clients for their financial products.
- Save time: Hunting for the very best finance deals and researching the various products available can be very time-consuming. Business owners need as much time as possible to focus on growing their business, and by using a broker, you can spend your time where it really matters and leave them to organise your business funding.
- Ongoing support: A commercial finance broker will aim to build an ongoing relationship with you and your business. This means that as your business expands over the years, they will be able to support you in finding the best finance options for your next steps.
- Personal service: By using a business finance broker, you will be getting a personal, face to face service. You will have the added benefit of being able to meet up and discuss your business needs, and they will be able to inform you of the best finance products for you.
- Trusted professionals: When you choose to use a business finance broker, you will have peace of mind that you are getting a service you can trust and rely on. All brokers in the UK are required to be regulated by the Financial Conduct Authority (FCA), which means they have to meet strict regulations that cover their professional competence, integrity and business viability.
- Terminology explained: Getting your head around the language used for various financial products can be a struggle, especially when every lender will have their own terms and conditions that you need to understand. A business finance broker will be able to help you to understand precisely what the terms and conditions mean for each individual lender.
A finance broker is not the same as an Independent Financial Advisor (IFA). An IFA is someone who offers investment advice, whereas a finance broker will act on your behalf to find you suitable funding. A finance broker is not allowed to provide you with any investment-related advice.