Best Business Loans

Can I consolidate or restructure my current finance agreements?

The short answer, definitions, and when it makes sense

Yes — many established UK businesses can consolidate or restructure existing finance agreements, subject to lender criteria, affordability, and security. The right approach can simplify repayments, improve cash flow, and help regain control, but approval is not guaranteed. It may also increase the total cost of borrowing if the term is extended.

Consolidation means combining multiple business finance facilities into a new agreement, usually with one monthly repayment. Restructuring means changing the terms of one or more current facilities to better fit cash flow, such as extending the term, switching product type, or amending covenants. Both options aim to make repayments more manageable while keeping the business on track.

Common triggers include seasonal cash pressure, multiple providers creating admin burden, variable rates rising, or balloon payments due on asset finance. Some firms act proactively ahead of a renewal date to secure predictable costs. Others restructure after a change in trading conditions or following a one-off shock.

What types of business finance can be consolidated or restructured?

Unsecured term loans and working capital loans.
Asset finance and hire purchase, including vehicle and equipment agreements.
Merchant cash advance and revenue-based finance.
Business credit cards and overdrafts (business use only).
VAT and Corporation Tax funding loans.
Selective invoice finance and factoring lines.

Not every facility is suitable for consolidation, and some lenders may decline early settlement. Facilities secured on property or with complex covenants may require specialist assessment. Always factor in early repayment charges before proceeding.

Important notice

Information on this page is for UK businesses only and is not financial advice. Best Business Loans is an independent introducer and does not lend or provide broker services directly. Any funding is subject to provider terms, status, and affordability checks.

How consolidation and restructuring work — routes, steps, and documents

There are several practical routes to simplify your current agreements. The best path depends on your cash flow pattern, asset profile, credit history, and sector. A quick review of your facility schedule often reveals the most cost-effective option.

Typical routes to consider

Single term loan refinance: Settle multiple smaller loans into one fixed-term facility with one monthly repayment.
Asset refinance: Refinance owned equipment or vehicles to release equity and settle other short-term finance.
Consolidate revenue-based facilities: Replace merchant cash advances with a term loan to reduce daily deductions.
Restructure invoice finance: Adjust advance rates, fees, or debtor concentration limits to improve drawdown capacity.
Term extension or interest-only period: Seek temporary relief by stretching the term or restructuring payments.

Step-by-step: what the process typically involves

Initial review: List all current agreements, balances, rates, terms, settlement figures, and security.
Cash flow mapping: Model repayments versus income cycles to define an affordable profile.
Provider matching: Shortlist lenders active in your sector and comfortable with your profile.
Indicative terms: Obtain heads of terms showing rate, term, fees, and any security or guarantees.
Underwriting: Submit documents for assessment, including management accounts and bank statements.
Legal and settlement: Pay off existing lenders and perfect any new security if required.
Go-live and monitoring: Start the new arrangement and track cash flow benefits.

Documents you will usually need

Last 6–12 months’ business bank statements and latest filed accounts.
Up-to-date management accounts and aged debtor/creditor reports if relevant.
Asset schedules, valuations, and copies of current agreements with settlement figures.
Director ID and proof of address, plus details of any County Court Judgments or arrears.

When time is critical, start by confirming settlement figures and any penalties from existing lenders. This helps you compare the true cost of staying versus consolidating.

Costs, risks, eligibility, and the impact on credit

Consolidation and restructuring can reduce monthly outgoings, but costs must be weighed carefully. The headline rate is only one part of the picture. Look at the total amount payable across the full term.

Costs to consider before you proceed

Early settlement/exit fees: Common on asset finance, merchant cash advances, and fixed-rate loans.
Arrangement or facility fees: Charged by the new lender; sometimes added to the loan.
Security and valuation costs: For asset refinance or debenture-based facilities.
Legal costs: Especially where security is registered or intercreditor arrangements are required.
Broker/intermediary fees: Some providers or brokers charge fees; request all costs upfront.

If you extend the term to lower repayments, you may pay more interest overall. Conversely, moving to a more suitable product or rate can reduce the total cost. The right answer is specific to your business data.

Eligibility factors lenders commonly assess

Time trading, sector stability, and turnover trends.
Profitability, cash generation, and debt service cover.
Credit history, including any CCJs, arrears, or defaults.
Asset quality and equity if using asset refinance.
Existing security and any director guarantees.

Adverse credit does not automatically prevent restructuring, but it may restrict options or increase pricing. Evidence of improved trading or strong forward orders can help. Accurate management accounts can materially improve outcomes.

Will consolidation affect my business credit score?

Credit checks and new facilities can create hard searches, which may have a short-term impact. Over time, simplified repayments and on-time performance can support your credit profile. Always consider covenant obligations to avoid inadvertent breaches during the switch.

Fair, clear, and not misleading

All promotions should be fair, clear, and not misleading under UK standards. Clear disclosure of costs, fees, and risks helps you make an informed choice. Ask providers to lay out all charges before you proceed.

Sector-specific notes, examples, and alternatives to consolidation

Different industries face distinct cash flow patterns, asset cycles, and lender appetites. Sector-aware restructuring can improve approval odds and pricing. Introductions to providers active in your industry can save time.

Industry considerations that often matter

Manufacturing and engineering: Asset refinance on machinery can unlock working capital while consolidating smaller debts.
Construction and trades: Invoice finance terms and debtor concentrations are key; some firms consolidate MCAs into a single term loan.
Agriculture and farming: Seasonality and asset values drive affordability; refinancing equipment or vehicles can release cash for inputs. Explore options for your sector via our page on farming finance solutions.
Transport and logistics: Fleet finance consolidation can align repayments with contract income.
Hospitality and retail: Revenue volatility may call for restructuring to fixed monthly terms.

Case Example 1: A manufacturing business consolidated two MCAs and a short-term loan into a 48‑month term facility. Monthly outgoings fell by 32%, but the total payable rose due to the longer term. The business accepted the trade-off to stabilise cash flow.

Case Example 2: A construction firm refinanced three HP agreements into a single asset-backed facility. Early settlement fees applied, but maintenance of security and improved rates created a net saving over the remaining term. Admin burden reduced with one provider.

Alternatives to consolidation you should consider

HMRC Time to Pay: Spreads tax liabilities to protect cash flow without new lending.
Invoice finance or top-up: Increase advance rates to boost working capital without changing loan terms.
Asset refinance only: Leverage owned assets to settle smaller, high-cost debts.
Overdraft review: Switch to a structured term loan if overdraft charges are high or variable.
Growth Guarantee Scheme (via accredited lenders): May offer additional security to support viable firms.

If consolidation primarily lowers payments by extending terms, ensure it aligns with your medium-term plans. If your priority is total cost reduction, compare like-for-like terms carefully. Ask for written comparisons of total amount payable in both scenarios.

How Best Business Loans can help, next steps, FAQs, and key takeaways

Best Business Loans connects established UK businesses with suitable lenders and brokers for consolidation or restructuring. We use smart data-matching to introduce you to providers who are active in your sector and open to your profile. It’s free to submit an enquiry, and there is no obligation to proceed.

What you can expect from our process

Quick assessment: Tell us your goals, challenges, and current facility list.
AI‑assisted matching: We identify providers likely to consider your case.
Introductions: You engage directly with matched lenders or brokers.
Indicative terms: Review sample terms, fees, and timelines before you commit.
Decision in Principle: Many providers can offer a DIP subject to underwriting.

We do not guarantee approvals, rates, or outcomes. Your decision should consider the total cost, early settlement fees, and any security or guarantees. Independent advice may be appropriate for complex situations.

Ready to explore your options?

You can check eligibility and request a Quick Quote in minutes. Provide recent bank statements, management accounts, and your agreement schedule for faster matching. Start here: Get Your Free Quick Quote.

Compliance and transparency statement

Best Business Loans operates as an independent introducer and does not provide loans or credit brokerage directly. All finance is for business purposes only and subject to status, affordability, and provider terms. Consolidation can reduce monthly repayments but may increase the total amount payable over time.

FAQs: consolidating or restructuring business finance

Will consolidating my agreements always save money? Not necessarily, as extending the term can increase the total payable even if monthly costs fall. Compare total cost, not just the instalment.

Can I consolidate if I have arrears or a recent CCJ? Some specialist lenders may still consider cases with challenges. Evidence of recovery and strong forward orders improves your chances.

Can I include asset finance in a consolidation loan? Yes, but early settlement fees and existing security must be reviewed. Sometimes asset refinance is a better route than rolling assets into an unsecured facility.

How long does it take? Simple cases can complete in days once documents are ready. Complex security or intercreditor requirements can extend timelines.

Will I need a personal guarantee? Many providers request a director guarantee for unsecured or partially secured facilities. Requirements vary by lender and risk profile.

Key takeaways

Yes, you can often consolidate or restructure — subject to lender criteria and affordability.
Run the numbers on early settlement fees and total amount payable, not just the monthly cost.
Match by sector and facility type to improve approval odds and terms.
Consider alternatives like invoice finance, HMRC Time to Pay, or asset refinance.
Use a guided introduction to providers who are actively lending to businesses like yours.

About this page

Content updated October 2025. For clarity on UK standards, see the Financial Conduct Authority’s guidance on fair, clear, and not misleading promotions and the British Business Bank’s resources. This page is informational and not advice.