Refinancing debts is becoming a solution for companies to avoid bankruptcy, and banks have been very inclined to refinance the debts of creditor companies for years, especially in sectors that have been severely affected by the crisis, such as real estate.
Even so, it is a last resort solution because refinancing means increasing the repayment period of the principal owed, so the interest payment will be much higher. In the short term, the payment for bank loans and credits is reduced, but in the long term the interest expense will be much phone number in united kingdom higher. Even so, as I was saying, refinancing debts is a solution that has been accepted by banks until now, when an SME cannot meet its payment obligations. The steps to follow to refinance your company's debts are:
Justify the impossibility of the business to meet its payment obligations. But justify that refinancing will allow the business to be viable, because otherwise the SME would not be able to ensure the repayment of the debt refinanced to the bank. Remember to take my advice into account when requesting financing.
gree that while the refinancing is being negotiated, the company will not request any more loans and the bank will not execute the guarantees despite the company's failure to comply with its obligations. Since refinancing debts is a long and complex process, sometimes the company fails to comply with the schedule for repaying the principal. Therefore, according to the literal wording of the credit or loan contract, this would be a breach.