A mortgage brokerage has predicted a significant rise in demand for asset finance in the coming financial year, forecasting a doubling in its loan volume in the sector.
Since introducing asset finance to its panel of 30 lenders last year, Aussie Home Loans has written around 1,000 loans and expects the increasing demand to be seen across individual, self-employed and SME borrowers moving forward.
“Many of those taking up asset finance with Aussie are home loan customers, who have used and trust our model to provide them with competitive financing options for their businesses, investments and residential needs,” said Aussie chief customer officer, David Smith.
“Aussie stores are now investing in dedicated asset finance brokers, who are benefitting from the increased confidence that was generated in the business sector following the recent federal election result and cash rate cut,” Smith said, referring to PM Scott Morrison’s campaign platform of extending instant asset write-offs to $30,000 to help small businesses with cash flow and improve access to financing.
“We are seeing increasing demand in car and equipment finance, especially in the lead-up to June 30, 2019, as small businesses gain a tax break with asset purchases under $30,000,” he added.
While the end of the financial year may have galvanised borrowers into action, the measures put in place to incentivise asset financing will carry over into July and beyond.
Director of Limba Loans, Olly Guilleaume explained, “There’s a lot of noise about obtaining your tax break pre- end of financial year, which leaves people thinking that most of those tax breaks don’t exist post- the end of the financial year, when the majority of those that have been marketed will still be available just like they were this week.”
“It just means that the tax benefit is potentially recovered further down the track, but the assets are still there, they’re still relatively the same price, and they still get the same benefits,” he added, continuing to encourage brokers to stay vigilant about generating creative solutions for their borrowers.