Asset refinance and sale and leaseback
Raise cash against equipment, vehicles or property the business already owns, and keep using them. The lender takes ownership until you have paid it back, and can take the asset if you do not.
- Secured on assets
How it works
Asset refinance frees up cash tied up in things the business already has, such as machinery, vehicles, equipment or commercial property. It is often called sale and leaseback: the lender buys the asset, or takes ownership of it, and you pay to keep using it, usually through a finance lease or hire purchase agreement.
- How much: depends on the type of asset, its age and condition, and how much of it you own. You cannot borrow more than it is worth. As an example, the British Business Bank describes a £20,000 oven with £2,000 still owed on hire purchase being refinanced for about £14,000, 70% of its value.
- Assets still on finance: you do not need to own the asset outright. The new lender usually pays off the old one and gives you the difference.
- At the end: you usually own the asset again once you have repaid the lender.
- Term: depends on the working life of the asset.
Some lenders also accept intangible assets such as licences, software or brands.
Upsides and downsides
Upsides
- Unlocks cash from assets you already own, without selling them
- You keep using the asset as normal
- Works even if the asset is still on finance
- Usually cheaper than unsecured borrowing
Downsides
- You can only raise part of the asset's value
- You give up ownership until the debt is repaid
- Adds a regular payment to your costs
Risks
- The lender can take the asset if you miss payments, which could stop the business working
- Borrowing against assets you will need to replace soon
What it costs
- How it is priced
- Interest and fees built into lease or hire purchase payments
- Costs that are easy to miss
- Arrangement and documentation fees
- Valuation fees
- Settling an existing finance agreement early can carry a fee
A share of the asset's value, less anything still owed on it. You cannot borrow more than the asset is worth.
Have a quote? True cost of a loan: work out the APR-equivalent and total cost
Does it fit?
Could fit when
- You own equipment, vehicles or property but are short of cash
- A bank has turned you down for an unsecured loan, but you have assets
Unlikely to fit when
- You have no equipment, vehicles or property to refinance
- You may need to sell or replace the asset soon
- You need a very large sum, and you cannot borrow more than your assets are worth
Who can use it
- Business types: Sole trader, Partnership, Private limited company, LLP, Public limited company, Community interest company, Co-operative or community benefit society
- Needs sales (revenue)
- You need assets with a resale value, such as machinery, vehicles, equipment or property
- You must be able to afford the repayments
Am I ready?
What a provider is likely to ask for. Tick what you have. Your ticks stay in this browser and nothing is stored. Checklist for all bank and mainstream debt
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- List of assets
- Proof of ownership
- Accounts and affordability
Regulation and protections
Many smaller businesses can take an unresolved complaint about a bank or other financial firm to the Financial Ombudsman Service. Check the agreement for what happens if you miss payments.
Types of provider: Asset finance companies; High-street and challenger banks; Specialist property lenders (for property sale and leaseback).
Also consider
Sources
- British Business Bank: What is asset refinancing? · checked 7 October 2026
- Financial Ombudsman Service (small business): Who we can help · checked 7 October 2026