The works represent an important item of expenditure for a company, it is necessary to respect some essential steps in order to obtain its financing.
Do your work with professional credit
The financing of work to create or renovate premises is an operation financed by the professional loan. Indeed, companies often meet the needs of upgrading, rearranging their workspace, or repairing premises following a purchase. Works therefore constitute an important part of the budget of a company, which is in the situation of choosing between drawing on its cash flow or having recourse to professional credit. When it comes to small jobs, the use of cash may be sufficient but very often the amount of the work can very quickly become very high and requires obtaining a professional credit.
- Find your professional loan at the best price and save on your project
- Benefit from the best support to realize your professional project with confidence
- Obtain financing for works
Several criteria, therefore, must nevertheless be carefully studied in order to obtain funding for the work.
- The surface to renovate
- The nature and type of work
- The number of professionals to contact
- Access to the site
The establishment of quotes
This different information will allow the company to carry out work in line with its needs but also for the banking establishment to be able to judge the relevance of the project and the granting of the professional loan. Submit your professional loan application; an expert will get back to you without any obligation on your part.
The important thing to finance your work with professional credit is to submit a complete application, in line with the needs of the company and its finances.
Any business requires a minimum of funds, whether it is at the start of a business or in the development phase. Banks remain the preferred choice for obtaining financing.
What Is The Role Of The Bank?
The bank receives the project leader and is interested in two points:
The creator himself:
Are his training and experience in line with his project? What is his financial situation?
The business plan: what is the product, the customers, the competition? How will the project leader reach his customers? Does he already have an order book and suppliers?
The business plan is therefore essential. The final quantified result is only of interest if it is credible and coherent.
We do not want to know if the forecast operating account will be carried out to the nearest cent. This document should serve as an objective to see on the one hand whether the charges are balanced and whether the project promoter is facing the reimbursement charges , and on the other hand to verify the credibility of the project .
What Types Of Financing Can A Bank Offer To An Entrepreneur?
The bank can finance anything, but it is trying to find out how it will be repaid. We can finance the business, the material, the equipment. In short, the work tool of the entrepreneur.
There are two types of financing: classic loan or leasing. The difference between the two is essentially legal:
- With leasing, the lender retains ownership of the financial asset.
- With traditional credit, the business becomes the owner.
- Leasing can therefore only finance equipment.
For example, if you have a project of 200,000 Euros, you have an entry fee of 50,000 Euros, 50,000 Euros of work and 100,000 Euros of material. Thus, there can be two types of financing: for the entrance fee and works, it is a classic loan; for the material, one can make a financial lease. The advantage of leasing is that the
VAT is recoverable and we can do 100% financing, while for a classic loan, a personal contribution is required.
What Type Of Project Is Suitable For Financing By Banks?
Any type of activity
When an entrepreneur sets up shop, he needs a working tool, made up of tangible (material) or intangible (right to lease, for example). The bank can position itself on these different aspects, for traditional activities of commercial type, provision of services, etc.
How Much Funding Can We Expect From A Bank?
- On conventional credit, no more than 80%.
- The bank cannot take all of the risk. In the 20% of personal contribution, there may be the call for an honorary loan or a platform of initiative.
Even if there is more personal contribution, a bank can provide 80% of the initial financing; the remaining personal contribution will be used to finance the treasury and will be an additional element of reinsurance.
It is also very important to provide for cash flow requirements in the financing plan. Support during the first years is also essential, because the supported projects succeed much better after 5 years. It is therefore also a point that interests us: the project leader must be attentive.
What Are The Right Questions To Ask When The Bank Refuses To Finance?
- It is necessary to ensure the coherence and the credibility of the project, and to have the answers to the questions of the banker.
- In the event of a refusal, there are also market elements that can dissuade the bank from financing: political, economic, legal news, sector of activity, environment, etc.
- There is also a subjective side.
- You don’t necessarily get the financing from the first bank you turn to.
- The second or third time, the creator can rework the banker’s questions, rethink his project a little. He is better prepared and has better control of his speech.
These experiences should serve as a validation tool for the project. When for small finance works these loans are needed, you need to be specific at every level. The options are clear, as mentioned before. So it will be easier for you to get the best choices. Now that online sites are there, you can go for the best choices and get the intended loan. However, taking proper precautions and checking on the repayment options is an important part of the process here.