Can I refinance a hire purchase agreement?

Yes. Hire purchase agreements can normally be refinanced by settling the outstanding balance and arranging new finance or converting to a loan, subject to early repayment costs and contract terms.

Are merchant cash advances refinancable?

Sometimes. MCAs can be repaid or refinanced by term loans or invoice finance where cashflow and lender consent allow, but costs and contractual constraints make this more complex than standard loans.

Will refinancing always reduce my monthly payment?

Not always. Lower monthly payments can come at the price of a longer term and more total interest. A full cost comparison including fees and APR is essential before deciding.

What types of finance can I refinance (loans, asset finance, hire purchase, equipment, vehicles, MCAs)?

Short answer — what you can refinance

You can usually refinance most forms of business finance, including term loans, asset finance, hire purchase agreements, equipment and vehicle finance, and in some cases merchant cash advances (MCAs).

The exact options depend on the original contract, the lender’s terms, and your business profile.

Overview: which finance types are commonly refinanced

Term business loans and overdrafts

Medium- and long-term business loans are commonly refinanced to reduce monthly payments, extend terms, or consolidate debt.

Business overdrafts are less often “refinanced” in the formal sense but can be replaced by a term loan or a new overdraft facility.

Asset finance, hire purchase and leasing

Asset finance arrangements such as hire purchase (HP), finance leases and chattel mortgages can generally be refinanced or restructured.

Options include refinancing the outstanding finance with a new asset finance lender, refinancing into a different product type, or arranging a sale-and-leaseback.

Equipment and vehicle finance

Finance secured on equipment and commercial vehicles is frequently refinanced, especially by asset-rich businesses looking to free cash or get better terms.

Some lenders will refinance the same asset; others prefer to fund a replacement asset and settle the existing agreement.

Merchant Cash Advances (MCAs) and short-term funding

MCAs and merchant loans are more specialised and higher cost, but they can sometimes be refinanced or repaid by alternative finance, subject to remaining balance and early repayment terms.

Refinancing options are often conditional on consent from the MCA provider and on replacing the fast repayment structure with a term loan or invoice finance.

How refinancing differs by product

Refinancing secured vs unsecured loans

Secured loans use business assets as collateral and are often easier to refinance because new lenders can take the same security once the old debt is repaid.

Unsecured borrowing depends more on trading performance and credit profile, which can make refinancing more selective.

Refinancing hire purchase and finance leases

Hire purchase typically transfers ownership at the end of the term, and the outstanding balance can be refinanced by settling the HP agreement with new finance.

With finance leases, ownership may never pass to you, so refinancing usually means replacing the lease with a loan or new lease and arranging reassignment or settlement.

Sale-and-leaseback and refinancing alternatives

Sale-and-leaseback lets you sell an owned asset to release capital and then lease it back, which is a form of refinancing for asset-rich firms.

This can improve working capital without adding unsecured debt, but it changes ownership and may have tax and balance-sheet effects.

Merchant Cash Advances, invoice and alternative finance specifics

Can MCAs be refinanced?

MCAs are repaid via a fixed percentage of card sales and are often high-cost; refinancing is possible but depends on the provider’s terms.

Refinancing typically involves shifting an MCA into a term loan, invoice finance, or asset-backed facility — if cashflow and affordability allow.

Invoice finance and working capital facilities

Invoice finance (factoring and invoice discounting) is often used alongside or as a replacement for other short-term credit.

You can move between invoice finance providers or refinance outstanding facilities by agreeing a structured paydown with a term lender.

When refinancing is restricted

Some agreements include early repayment penalties, prepayment fees, or restrictions that make refinancing expensive or contractually complex.

In those cases you should compare the total cost of refinancing (fees + interest + operational disruption) against the expected savings.

Practical steps and checks before refinancing

Review the existing agreement

Start by obtaining the full contract and a settlement figure from the existing lender showing any fees or early repayment charges.

Confirm whether the lender requires redemption notices, consent for novation, or will accept assignment to a new provider.

Compare real cost and affordability

Refinancing for a lower monthly payment may lengthen the term and increase total interest; always compare APR, term, and fees.

Factor in arrangement fees, legal costs, valuation fees for assets, and any business disruption.

Check security and personal guarantees

Refinancing an asset-backed product usually requires new security documents and possibly new personal guarantees.

Consider how replacing a secured loan with unsecured borrowing affects risk, covenants and ownership of assets.

How Best Business Loans can help and next steps

What we do (and what we don’t do)

Best Business Loans does not provide loans or direct credit; we are an independent introducer that helps UK businesses find suitable finance providers.

We use AI-driven matching to identify lenders or brokers who specialise in refinancing your type of facility, from asset finance to MCAs.

Steps to get a quick assessment

Complete a short Quick Quote form so our system can assess the likely refinance routes for your business.

We then match you to lenders or brokers who may offer refinancing, providing a Decision in Principle or eligibility check where appropriate.

When refinancing makes sense — and when it doesn’t

Refinance to reduce cost, consolidate multiple facilities, release equity, or move from volatile short-term funding to structured repayment.

Avoid refinancing if penalties and fees outweigh savings or if it masks deeper cashflow problems that require operational change.

Ready to explore refinance options?

If you want to explore refinance options tailored to your business type and the finance you currently have, start with a Quick Quote.

Begin your eligibility check today and we’ll connect you with relevant lenders and brokers: Refinance options and Quick Quote.

Key takeaways

Most business finance can be refinanced — including term loans, asset finance, hire purchase, equipment and vehicle finance, and sometimes MCAs.

Successful refinancing depends on contract terms, early repayment charges, security arrangements, and your business’s credit and cashflow.

Use an independent introducer to compare options quickly and get matched to lenders or brokers who actually handle your finance type.

Compliance and transparency

We provide information to help you make an informed decision and never promise approvals or specific savings.

Best Business Loans is not a lender and is not authorised by the Financial Conduct Authority to provide regulated advice.