How Does Asset Refinance Work? A Complete Guide for UK Businesses

If you’re a business owner looking to unlock capital tied up in existing assets, you’ve likely come across the term asset refinance. But how does asset refinance work – and when is it the right option for your business?

In simple terms, asset refinancing allows businesses to raise cash by leveraging equipment, vehicles, machinery, or other high-value assets they already own. It’s one of the most flexible and accessible ways to release working capital, restructure debt, or reinvest in your company – without giving up equity or taking out a traditional loan.

At The Best Finance Group, we help UK businesses navigate the refinancing process from start to finish, ensuring they access competitive rates and the most suitable lenders. In this guide, we break down everything you need to know about asset refinance: how it works, when it makes sense, the types of assets you can refinance, and how to get started.

What Is Asset Refinance?

Asset refinance (also known as asset-backed refinancing or capital release) is a form of secured lending where a business uses an owned asset as security for a loan. The asset is typically one that the business already owns outright or has substantial equity in, such as:

• Commercial vehicles (vans, trucks, HGVs)
• Machinery and plant equipment
• IT systems and hardware
• Office furniture or fittings
• Agricultural equipment
• Engineering or manufacturing tools

The lender values the asset and lends a percentage of its market value – usually between 70–90% depending on age and condition. Your business receives a lump sum of capital upfront, then repays the loan in instalments over an agreed term.

How Does Asset Refinance Work in Practice?

Here’s a simplified overview of how the asset refinance process typically works:

How Does Asset Refinance Work in Practice?

Here’s a simplified overview of how the asset refinance process typically works:

1. Asset Valuation
   The lender assesses the value of the asset(s) you want to refinance. They’ll look at market demand, depreciation, usage, and condition.
2. Loan Offer Issued
   Based on the valuation, the lender offers a refinancing facility – often between 70% and 90% of the asset’s current value.
3. Legal & Security Process
   The lender secures a legal interest in the asset making it the collateral for the loan.
4. Funds Released
   Once all documents are signed and security is in place, the funds are released – often within a few days.
5. Repayment Period
   You repay the loan in monthly instalments (usually over 1 to 5 years). In many cases, you retain full use of the asset during this time.

Why Do Businesses Use Asset Refinancing?

Asset refinance is one of the most flexible funding tools available to established businesses. Here are the top reasons companies choose to refinance:

Release Working Capital

Use the value tied up in your assets to support cash flow, stock purchases, payroll, or marketing.

Fund Expansion

Raise capital for growth without taking on unsecured debt or bringing in external investors.

Restructure Existing Finance

Refinance existing agreements to consolidate debts, reduce monthly payments, or secure better rates.

Buy Out a Partner

Use refinancing to raise funds for a shareholder buyout or to acquire another business.

Cover Short-Term Liabilities

Tackle unexpected tax bills, supplier invoices, or operational gaps without disrupting long-term plans.

What Types of Assets Can Be Refinanced?

Not all assets are eligible, but lenders tend to accept business-critical, high-value, and depreciating assets that hold value on the secondary market.

Commonly refinanced assets include:

• Commercial Vehicles – Trucks, vans, coaches, HGVs
• Construction Equipment – Excavators, loaders, cranes
• Manufacturing Machinery – CNC machines, lathes, presses
• Agricultural Equipment – Tractors, balers, harvesters
• Technology & IT – Servers, data centre hardware
• Printing Equipment – Digital presses, binders, cutters
• Office Assets – Fixtures, fittings, even office furniture (in some cases)

How Much Can You Borrow?

This depends on several factors, including:

• Type of asset
• Age and condition
• Ownership status (fully owned or financed)
• Resale value and depreciation

Typically, lenders will finance between 70% and 90% of the asset’s current market value.

How to Apply for Asset Refinance

At The Best Finance Group, we make the process quick, simple, and fully supported.

Step 1: Submit Asset Details

Let us know what assets you’re looking to refinance, their estimated value, and ownership status.

Step 2: Get a Free Quote

We’ll approach our panel of lenders and return with competitive quotes within 24–48 hours.

Step 3: Choose Your Offer

We’ll help you compare the deals, understand the terms, and select the right facility for your needs.

Step 4: Complete the Paperwork

Once approved, we’ll handle the paperwork and security registration with the lender.

Step 5: Get Funded

Funds can be released in as little as 3–5 days, depending on the complexity of the deal.

FAQs: How Does Asset Refinance Work?

Can I refinance an asset I’m still paying for?
Yes, as long as you have equity in the asset (i.e. it’s partially paid off). The new lender may settle the existing finance.

Do I lose ownership of the asset?
No, in most cases, you retain use and control. The lender registers a legal interest, but ownership remains with you unless repayments are missed.

How quickly can I get funding?
Some lenders can release funds in 3–5 business days. Complex or high-value assets may take longer due to valuations.

Are there any fees?
Yes, most lenders charge arrangement or valuation fees. We’ll always disclose these clearly when presenting your options.

Will this affect my credit score?
Asset refinance is secured, so it may have less impact on your score than unsecured loans. However, missed repayments could affect your credit profile.

Conclusion: Unlock the Value in Your Business Assets

If you’re wondering how asset refinance works, the answer is simple: it’s a flexible, fast, and effective way to turn existing business assets into usable capital.

At The Best Finance Group, we help businesses across the UK unlock thousands of pounds tied up in plant, vehicles, equipment, and machinery – without disrupting operations or taking on unnecessary debt.