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How far in advance should you plan your commercial finance solution?

Today I’m going to talk about the timescales involved for Tier 1, Tier 2, and
Tier 3 commercial lending and commercial mortgages.

In terms of putting a case together, getting it submitted, getting a decision
in principle, getting it credit backed (underwritten), and then the time it
takes to go through the legal process in order to draw down the funds.

The purpose of this is really just to give you an idea, if you’re looking to
buy a commercial property, either as an investment, or for owner operation,
or even a trading business, then these are the timescales that you are going
to be looking at.

I’m going to break it down into tier 1, tier 2, and tier 3. This is slightly
different to some other areas where tier 1 is actually going to be a Business
Development Manager (BDM) that you’re talking to, so you are actually talking
to a person, whereas tier 2 and 3 tend to be more portal based, particularly
tier 2 – where it is either meeting criteria, or it isn’t. Tier 3 depends on
the lender, but some lenders will be BDM and some will be portal.

So, on to the timescales. For a decision in principle for a tier 1 loan, using a
BDM, you will most likely be looking at one to two days. For a tier 2, even
though you would apply through a portal, you would still be looking at one to two
days. If you were processing a tier 3 loan, you could have a decision in principle
back in as little as four hours, though this could go up to two days. So, for all
three tiers, it is best to err on the side of caution and plan for the process to
take up to two days.

If you then want to get that decision in principle credit backed, because you are
happy with the deal that’s offered, then that process can take up to 4-5 days,
depending on how quickly an evaluation can happen, and then from evaluation and
credit backing, the timescale to actually draw down the funds varies.

For tier 1, you can look at drawdown taking ten to twelve weeks, tier 2 can be
eight to twelve weeks and for tier 3, you can expect it to take eight to ten weeks.

If you are thinking of going through this process, ideally, you should attempt to
plan anywhere between three and a half to four months ahead of the time that you
want the process to be completed. There is, of course, an option if you want to
do it quicker.

You can look at Bridging Finance (which will be the topic of next week’s blog), so
if you are unable to secure it within the time scale of the three and a half to
four months, as long as the ability to refinance was there, you would be able to
secure the asset quickly.

A lender for a bridge would want to know what your exit strategy for the finance
was, and your exit would be to refinance. As long as you are able to show that
you are able to refinance, then the bridge should be forthcoming.

If you want to discuss these or other business finance options, get in touch by
filling out the contact form on this website and we can work out what solutions
will fit your needs.

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Security Guard Companies and their funding gap – how are they going to fill it?

Some of my Security Guard company clients have been asking me how they can
bridge the financial gap between the downturn of trade and when things return
to normal.

Hi, my name is Graeme Shevas.

I help Scottish Security Guard Companies who are having problems with
their cash flow, to release cash from their sales invoices.

I’ve been in business for over 30 years and one of the questions that
my customers have been asking me lately is ‘how do I get my cashflow moving
now that other businesses are having trouble paying their bills?’.

Here’s my best advice:

If you’re a Scottish firm operating in the business-to-business sector,
you’ll be raising invoices for your products or services. At the moment,
your normal payment terms for those invoices will most likely be 45 to 60
days. You may have seen a drop-off in trade and the amount of money that
you’re going to have over the coming months will be significantly reduced.

You may well have enough to get you through until the point where you can
begin trading at normal levels again, but when you need cash to pay the bills
as you return to normal trading levels, you’re going to have to wait another
45-60 days for payment. Therefore, the actual funding gap is going to be longer
than the business interruption.

How are you going to plug that gap?

This is where Invoice Finance and the Coronavirus Business Interruption Loan
Scheme (CBILS) guarantee may be able to help. As soon as you raise an invoice
you could have access to 85-90% of its value within 24 hours instead of having
to wait the 45-60 days to get paid.

This will give you ready cash flow to allow you to meet your costs and thrive
as we get back to normal.

This is something that I specialise in and my role is to make sure that you
don’t need to go to lots of different providers. You only need to provide your
information once and we will access the most suitable providers based on the
sector that you’re in, your turnover, and how your business is doing.

It is a straightforward process to apply and it doesn’t cost you anything,
my fee is covered by the provider.

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Recruitment companies have options available to release cash from their sales invoices.

Hi, my name is Graeme Shevas.
I help Recruitment Companies who are having problems with
their cash flow, to release cash from their sales invoices.

I’ve been in business for over 30 years and one of the questions
that my customers have been asking me lately is ‘how do I get my
cashflow moving now that other businesses are having trouble paying
their bills?’.

Here’s my best advice: If you’re operating in the Business to Business
sector, you’ll be raising invoices for your products or services. At the
moment, your normal payment terms for those invoices will most likely be
45 to 60 days. You may have seen a drop-off in trade and the amount of
money that you’re going to have over the coming months will be significantly
reduced.

You may well have enough to get you through until the point where you can
begin trading at normal levels again, but when you need cash to pay the
bills as you return to normal trading levels, you’re going to have to wait
another 45-60 days for payment. Therefore, the actual funding gap is going
to be longer than the business interruption.

How are you going to plug that gap? This is where Invoice Finance and the
Coronavirus Business Interruption Loan Scheme (CBILS) guarantee may be able
to help.

As soon as you raise an invoice you could have access to 85-90% of its
value within 24 hours instead of having to wait the 45-60 days to get
paid. This will give you ready cash flow to allow you to meet your costs
and thrive as we get back to normal.

This is something that I specialise in and my role is to make sure that
you don’t need to go to lots of different providers. You only need to
provide your information once and we will access the most suitable providers
based on the sector that you’re in, your turnover, and how your business is doing.

It is a straightforward process to apply and it doesn’t cost you anything,
my fee is covered by the provider.

If you think this may work for you, or have any questions, fill out the ‘Contact Us’
page on this website and we can have a discussion about how we can help.

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Are you in the Construction Industry and need assistance with your cashflow due to Coronavirus? We can help.

If you are in the Scottish Construction business and having problems with
your cashflow due to unpaid invoices, we have a solution for you.

Hi, my name is Graeme Shevas and I help Scottish Construction businesses
who are having problems with their cashflow to release cash from their
sales invoices.

I’ve been in business for over 30 years and one of the questions that
my customers have been asking me lately is ‘how do I get my cashflow moving
now that other businesses are having trouble paying their bills?’.

Here’s my best advice: If you’re a Scottish firm operating in the
business-to-business sector, you’ll be raising invoices for your products
or services. At the moment, your normal payment terms for those invoices
will most likely be 45 to 60 days. You may have seen a drop-off in trade
and the amount of money that you’re going to have over the coming months
will be significantly reduced.

You may well have enough to get you through until the point where you can
begin trading at normal levels again, but when you need cash to pay the
bills as you return to normal trading levels, you’re going to have to wait
another 45-60 days for payment. Therefore, the actual funding gap is
going to be longer than the business interruption.

How are you going to plug that gap? This is where Invoice Finance and
the Coronavirus Business Interruption Loan Scheme (CBILS) guarantee may
be able to help. As soon as you raise an invoice you could have access
to 85-90% of its value within 24 hours instead of having to wait the
45-60 days to get paid. This will give you ready cash flow to allow you
to meet your costs and thrive as we get back to normal.

It is a straightforward process for the application and there are no fees
for me to do that, as they are covered by the provider.

This is something that I specialise in and my role is to make sure that
you don’t need to go to lots of different providers. You only need to go
to me and I will access the most suitable providers based on the sector
that you’re in, your turnover, and how your business is doing.

I can save you time and get you the deal that will work for you.

I hope you found that useful. If you’re a Construction business based
in Scotland and you need help with Invoice Financing, you
can reach me on 07776 257 342, graeme@playfairfinance.co.uk
or fill in the ‘Contact Us’ page on this website.

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Scottish Commercial Lending Expert answers question about releasing cash from unpaid sales invoices

Hi, my name is Graeme Shevas.

I help Scottish Contract Cleaning businesses, who are having problems with
their cash flow, to release cash from their sales invoices.

I’ve been in business for over 30 years and one of the questions that
my customers have been asking me lately is ‘how do I get my cashflow moving
now that other businesses are having trouble paying their bills?’.

Here’s my best advice: If you’re a Scottish firm operating in the Business to Business
sector, you’ll be raising invoices for your products or services. At the moment, your
normal payment terms for those invoices will most likely be 45 to 60 days. You may have
seen a drop-off in trade and the amount of money that you’re going to have over the coming
months will be significantly reduced.

You may well have enough to get you through until the point where you can begin trading
at normal levels again, but when you need cash to pay the bills as you return to normal
trading levels, you’re going to have to wait another 45-60 days for payment. Therefore,
the actual funding gap is going to be longer than the business interruption.

How are you going to plug that gap? This is where Invoice Finance and the Coronavirus Business
Interruption Loan Scheme (CBILS) guarantee may be able to help. As soon as you raise an
invoice you could have access to 85-90% of its value within 24 hours instead of having to
wait the 45-60 days to get paid. This will give you ready cash flow to allow you to meet
your costs and thrive as we get back to normal.

There are other ways of raising cash in the short-term, such as bridging loans or refinancing
assets, but in my view at the moment, the longer-term solution would by your Invoice Financing
provision. It is a straightforward process for the application and there are no fees for me to do
that, they are covered by the provider.

This is something that I specialise in and my role is to make sure that you don’t need to go to
lots of different providers. You only need to go to me and I will access the most suitable
providers based on the sector that you’re in, your turnover, and how your business is doing.
I can save you time and get you the deal that will work for you.

I hope you found that useful. If you’re a Contract cleaning business based in Scotland and you need
help with Invoice Financing, you can reach me on 07776 257 342, at graeme@playfairfinance.co.uk, or
fill in the ‘Contact Us’ page on this website.