Time to Refinance?
Despite a difficult economy, women-owned firms are growing twice as fast as male-owned businesses.
A number of commercial loans are expected to mature over the next few years. For an entrepreneur, this could be a burden.
When is it a good time to consider refinancing your business?
“Three times I would recommend this option is when a business wants to reduce monthly expenses, change the terms of their loan, or if there’s been a significant change in rates since the loan was closed,” says Fran Friedrich, commercial banking VP at SunTrust Bank.
Once you’re seeking refinancing, plan what you want to accomplish. If you’re trying to lower payments, let your current lender tell you all the available options, says Friedrich. “Have a goal in mind.”
Next, compare refinancing options from other lenders, to see what else is on offer out there.
But, while reducing payments improve monthly cash flow, they take longer to pay off in the long run, she cautions. To overcome this, if you negotiate lowering a high interest rate, then your monthly payments can be reduced without extending the term of the loan.
Just remember – most refinancing options have a fee associated with them. “Consider the cost of the fees vs. how much you’re saving by refinancing,” Friedrich adds.
Bonus PINK Link: Read which financial services suit your business needs.
Have you considered refinancing your business? planning it?
By Shaina Ali
“Bad debt is sacrificing your future day needs for your present day desires.”
Suze Orman
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