Consolidating can save thousands and improve cash flow. Did you know you can refinance business debts are residential rates?
Example –
John is a small business owner and set up a $300,000 overdraft (currently fully drawn), secured by his house, at commercial interest rates of 10%, to run his business.
Johns debts are as follows:
$300,000 Business loan at 10%
$500,000 Home loan at 5.50%
$ 30,000 Credit card debt at 20%
$ 40,000 Personal car loan at 8%
$870,000 Total debts
Based on the above, the total amount of interest being charged annually is $66,700 approximately.
As outlined above, Trusted Finance Solutions has access to lenders that allow the refinance of business debts at residential rates. If John’s house is already used as security, there is no need for him to pay commercial interest rates on his business loan when he can obtain residential rates. Most bank customers are not aware of this niche.
New Structure –
$300,000 Business loan at residential variable rates of 4.50%
$570,000 Home loan, credit card and car loan consolidated at 4.50%
$870,000 Total debts at 4.50% interest
In this case, with the reduced interest rates, the total amount of interest charged is $39,150 p.a.
Overall, there is an annual saving of $27,550 p.a or $2,295 per month.
An example of this nature is not unusual and by consolidating debt at residential home loan rates, it reduces interest charged and improves cash flow. For some people who are struggling with repayments, this can be a life changing experience.
