Transferring a business loan

[Ashley_Price]

Just a quick question.

If I get a business loan through one bank, how easy would it be at a later date to transfer it, or is that not possible?

 

[john1989]

I think you would have to get a settlement figure from current loan provider, and take a new loan out with new provider.

 

[Ashley_Price]

Hmmm! That sounds like paying off the loan to take out a new loan. It's not the same as balance transfers on credit cards then? (I'm ignorant I know, but then I have neither a bank loan nor a credit card.)

 

[Forthehealthofitjourney]

I agree with John, generally you would ask the bank for a redemption quotation, take a new loan out and pay the previous one. Loans (especially business loans) are different to retail lending such as credit cards, unfortunately because they are a structured product you can't just rotate the balance as you would with a credit card. Also some loans may fall into the realms of being secured lending (depending on the size and terms of the business loan) and would have their own set of terms and conditions that may prevent you from repaying the balance early.

I hope this helps

 

[Ashley_Price]

Thanks both. That's given me some thinking to do. There's one bank who I think will almost definitely give me a loan (as much as one can be positive about these things), but I don't like their business practices. So was thinking of taking the loan out with them then transferring it.

I think I will check with the other banks first and go back to the other one as a last resort.

 

[john1989]

Are there any banks left with a moral and ethical track record?

 

[Ashley_Price]

Are there any banks left with a moral and ethical track record?

Very few probably, but I'm thinking about how they treated me personally, but then I do have a "good" history with them in spite of it.

 

[Mark T Jones]

The above advice is true - effectively you are commiting to repay the full amount of instalments (not the capital balance), any discount will be applied against the instalment outstanding, so in a nutshell you will be paying interest on interest.

There are of course lenders outside the banks.