Business Overdrafts

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Business Overdrafts

Set at an agreed limit, an overdraft is a borrowing facility attached to the bank account and is ideal for your day-to-day expenses, especially if the business experiences cashflow problems.

Overdrafts are quick to arrange but they need to be reviewed regularly as if credit is extended an arrangement fee is usually payable.

As the interest rate tends to be higher than that of a loan, overdrafts are an expensive way for borrowing long-term. Overdrafts are often secured against business assets and the lender can seize these if the overdraft is not repaid. Furthermore, the bank can demand instant repayment.

Unlike loans, an overdraft can only be obtained from the bank where your business account is held.

If the terms and conditions of the account are not met, the charges can be high. Banks charge a referral fee if an account exceeds the overdraft limit without permission.

If you would like advice about any aspect of business finance, please complete a Quick Enquiry Form and we will arrange for one of our advisers to contact you. Or you can call us on 0845 108 0505.

Business-Loans.co.uk can give you everything you need to know about business finance. For the best deals available for personal loans, visit us at www.personal-loans.co.uk