Lombard helps businesses to buy the equipment they need to grow, funding a wide range of assets from business vehicles to machinery.
If you’re about to splash out on new equipment for your business or if you have equity locked up in existing assets, it’s possible that you could put your working capital or equity to better use elsewhere – say, funding faster growth. That’s where Lombard comes in.
A direct lender (not a broker) founded in 1861, Lombard has been in the asset finance game for more than 150 years.
The lender has “relationship managers” based throughout the UK, priding itself on catering to the peculiarities of different sectors and local markets.
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What is asset finance?
Asset finance is about accessing new equipment for your business or unlocking the value in existing assets (technically “asset refinance”).
It’s a blanket term covering a few different types of finance. For example, if your firm needs expensive new gear, but you don’t have that sort of cash lying around, then companies like Lombard could buy the equipment themselves and sell it to you bit-by-bit (like a hire purchase arrangement) or lease it to you for as long as you need it.
Asset refinance involves a straightforward loan secured against an existing asset (more like a mortgage or logbook loan).
As you’d probably expect, all these approaches work out more expensive than just purchasing an asset outright. However, in many situations, purchasing the asset up-front is simply not an option for a company, and even if it is an option, you might find a better purpose for those funds.
Key features at a glance
Lombard’s asset finance options
Lombard offers four types of asset finance. You should consider the pros and cons of each of them and decide which best suits your business before you apply.
- Find a vehicle at your preferred local dealer.
- Compare deals easily by using finance that isn’t attached to a car dealership.
- Receive a personalised interest rate.
- You have the option to keep your vehicle at the end.
- There’s an optional larger final payment (or “balloon” payment), which would bring your monthly payments down.
- You will own the vehicle.
- You will need to find your own vehicle.
- You will need to sell or exchange the vehicle at the end of the finance term if you don’t want to keep it.
- Choose your vehicle from Lombard’s large range.
- Benefit from purchasing discounts and special offers.
- Hand the vehicle back at the end of the finance term.
- Services such as maintenance are available.
- You will have to return the vehicle or arrange an extension on your term.
- You will need to select a vehicle provided by Lombard.
- You will need to agree on your mileage beforehand, though this can be changed. Excess mileage fees may apply.
- Rent rather than buy the asset to free up cash.
- Equal payments over an agreed term.
- Lombard recovers the cost of purchase from you over the term plus any interest charged.
- You won’t own the asset.
- The rentals can be offset against your profits at your discretion, except for when the structure of the lease is long funding. It is subject to provisions of HMRC Statement of Practice 3/91. Lombard will still retain the right to any capital allowances.
- Effective for high-value, specialised equipment or assets you need to support a specific contract.
- You can base rentals on the value of the asset over the period you require it for.
- You can link rentals directly to the revenue that your asset generates.
- Unlike a finance lease, rentals won’t recover the full cost of the asset.
- The lease will sit on your balance sheet as a right-of-use asset in most cases but not all – please speak with your accountant for more information.
The interest rate you are offered will depend on factors like the assets you want to finance, the term of the loan, the performance of your business and its credit rating. You will be given a personalised interest rate that may differ from the advertised “Representative APR”.
How can I apply?
Once you know the type of asset finance that you want for your business, you can apply for an instant quote on the Lombard website. If you are unsure what would suit your needs best, you can fill in a simple form requesting a callback. A finance expert will call you and talk through your options with you.
Frequently asked questions