4 Best Practices for Getting Automotive Business Financing
Many firms in the automotive sector — such as repair shops, new and used car dealerships, rental agencies, retailers, rust proofers, body shops, detailers and parts manufacturers — rely on a line of credit to support day-to-operations. However, to cover larger expenses or investments, it’s often necessary to take a more strategic approach to cash flow and capital management: and that’s where automotive business financing enters the picture.
Below, we highlight 4 best practices for getting optimal automotive business financing, which is a solution that maximizes your flexibility and leverage, while minimizes your cost and risk:
Automotive Business Financing Best Practice #1: Beware that some lenders take much longer than others to assess applications.
In business, time is always of the essence. However, some lenders — especially banks — that provide automotive business financing haven’t yet joined the 21st century, and take several weeks or months to assess applications. To avoid this costly and risky pitfall, ensure that the lender that you work with doesn’t leave you waiting and wondering.
For example, here at National Business Capital our turnaround time standard is 24 hours or less. The “business” in our name assures you that we understand, just as you do, that time is of the essence!
Automotive Business Financing Best Practice #2: Understand the documentation requirements before you apply — not after.
Some lenders — and again, banks are at the top of this list — require a substantial amount of documentation during the application process, including comprehensive business plan with detailed financial statements, resumes and other background information on managers and executives, cash flow projections, tax returns, personal and business credit scores, and the list goes on.
Conversely, some lenders — such as National Business Capital — have a streamlined application form that takes about two minutes to complete, and can be taken care of securely online at any time. In fact, you can get started right now if you wish, and we’ll be in touch later today!
Automotive Business Financing Best Practice #3: Collateral isn’t mandatory.
If you’ve been led to believe that collateral is mandatory for getting automotive business financing, then allow us to adjust that perception: it’s certainly not required by all lenders.
Here at National Business Capital, we don’t insist on collateral for many of our automotive business financing solutions, which means that your business and/or personal assets are not at risk of being immediately seized and liquidated in the event of a default. Your commitment to follow the terms and conditions our agreement is sufficient.
Automotive Business Financing Best Practice #4: Explore all of your options.
There is more than just one type of automotive business financing, and it’s certainly in your best interest to explore all of the options that are available.
At National Business Capital we provide short and long-term working capital loans (i.e. term loans), commercial mortgages, floor plan financing, equipment financing, inventory financing, accounts receivable financing, merchant cash advance, and revolving lines of credit.
To learn more about each of these financing solutions, contact our team today. Your consultation with us is free, and there’s absolutely no risk or obligation to move ahead.