Consolidating business debts

When a business owes money in several directions, the pressure compounds. Each creditor has its own due dates, its own letters and its own phone calls. Consolidation brings those debts together into one loan, one repayment and one relationship.

What can be consolidated?

• Overdue supplier accounts.
• ATO debts, including BAS and PAYG arrears.
• Business credit cards.
• Short-term loans and merchant cash advances.
• Equipment finance in arrears.

The new lender pays the existing creditors directly at settlement where possible, so the old debts are cleared rather than left for you to pay.

When consolidation helps

Consolidation is most useful when the business is fundamentally sound but over-stretched: sales are healthy, margins are reasonable, and the problem is the shape and timing of the debts rather than the business itself. In that case, one sensible repayment can free up enough cash to get back on track.

Not sure this fits your business? That is exactly what the quick enquiry is for. One team reads it, no credit check runs, and nothing is sold on.

When it does not

If the business is losing money each month, consolidation can buy time but will not fix the cause. Before borrowing, check whether:

1. The business is profitable once the debt repayments are removed.
2. The cause of the debt, such as underpricing or a lost client, has been fixed.
3. The new repayment fits comfortably inside normal cash flow.

If those are not true, talk to your accountant first. Our guide on when not to borrow covers the warning signs. The Australian Small Business and Family Enterprise Ombudsman also has resources for businesses in financial difficulty.

The role of property

Consolidations often involve a mix of debts that unsecured lenders find hard to assess. Property-secured funding from $20k to $5m, with no valuation and interest paid up front or capitalised, gives the business room to recover without a heavy weekly repayment.

A before-and-after check

List every debt, its monthly cost and its due date. Then compare that with a single loan’s repayment. If the difference gives the business real breathing room and the total cost is reasonable, consolidation is worth exploring.

Key takeaways

• Combines several debts into one repayment
• Can stop escalating creditor and ATO action
• Works when the business is viable but over-stretched
• Property security often makes it possible

How Capital At Call handles it

We keep it simple. Your enquiry goes to one team. That team calls you, confirms the details, asks for bank statements or property details and tells you honestly what looks achievable. If the right answer is a payment plan, a conversation with a supplier or waiting a quarter, we will say so. If funding fits, you get the amount, term, repayments and total cost spelled out before you sign anything. You will always know who is handling your file and how to reach them.

Is funding the right answer here?

Good borrowing has a job and an end date. Before you enquire, write down in one sentence what the money is for and how it will be repaid. If that sentence is easy to write, you are probably in the right place. If it is not, it is worth a closer look at the business’s cash flow before taking on new repayments.

Paperwork worth gathering

Have these within reach and the process moves quickly, because each one answers a question the assessor would otherwise have to come back and ask:

• ABN, business structure and how long you have traded.
• Recent business bank statements, ideally shared online.
• What the money is for and how it will be repaid.
• Any tax debt, default or arrears you should mention up front.
• Contact details for anyone else who would need to sign.

Help us match you first time

The enquiry asks for the amount, the purpose, how long you have traded, your monthly revenue, your credit history, your state and whether you own real estate. Each answer steers your enquiry towards the right option. Accurate answers let the first call move straight to solutions. Rounded-up turnover or a credit history that turns out to be different from the form means starting again, which costs everyone time.

Put your funding on call

It costs nothing to find out. Check your eligibility in about a minute, with no credit check and no obligation. One team handles your enquiry from start to finish, and you will hear from a person, not an automated system. Fill the form in as accurately as you can; a careful minute now saves days later.