Apart from governments and other agencies, the Australian Banking Association was also quick to come out to offer support measures for customers affected by the devastating flood situation in NSW and Queensland. Flood victim support has been offered by the banks for impacted customers in regard to loan repayments for a range of business and personal loans. For the many businesses that have lost equipment, machinery or entire operations due to flood damage or have had their income interrupted due to the situation may be eligible for support from their lenders.
The specific level of assistance available, will depend on both the lender and the customer’s situation with each request assessed individually. For businesses with equipment under finance and unable to meet their repayments or who have had to write-off their machinery, we outline the actions that they need to take to access support, insurance claims and new finance to acquire replacement equipment.
Support from Banks
The Australian Banking Association represents many Australian banks, including the majors, and the association issued a statement which outlines the range of support and assistance the banks are offering for flood-affected customers.
The support would bring some level of peace of mind to customers according to CEO Anna Bligh in the announcement. The general measures outlined include deferrals of repayments for home loans, personal loans and some business loans. Whether this will include your particular equipment finance repayments will be subject to the individual criteria of the bank.
Anna Bligh said that customers who have been affected by the flood and require loan repayment assistance should contact the bank and discuss the type and level of support which is available to suit their individual circumstances. She said that this was the emergency stage support and that the banks will be providing a tailored level of support during the ensuing stages of recovery.
The types of assistance which have been announced by the banks include:-
- Repayments deferred for 3 months
- Debt consolidation
- Restructuring loans without establishment fees
- Cash flow shortage finance
- Deferral of payments on credit cards
Business seeking flood victim support for equipment finance repayments should make direct contact with their bank to find out exactly what is available to them. While this information is based on a statement issued by the Australian Banking Association and is similar to the support available during the coronavirus crisis, similar measures are highly likely to also be available from non-bank lenders.
So regardless of whether or not your finance is with a bank or a non-bank lender, if you are not in a position to meet equipment loan repayments as a result of the floods, you should contact your lender. Overlooking the issue or waiting and missing repayments could result in the lender noting a default on a credit report which may result in a lower credit rating.
Those seeking loan repayment support should be aware that deferrals are effectively postponements not waivers. The amounts payable on the loans will still need to be paid. With deferrals, repayments are essentially paused for those months and then resumed. This extends the term of the loan by the number of months of the deferral.
During the COVID-19 crisis when similar measures were introduced, lenders advised that seeking loan repayment deferrals would not negatively impact the customer’s credit report.
Action for Equipment Lost in Floods
Repayment support should be sought if the equipment under finance is still operable. But where machinery or equipment under finance has been lost completely due to the flood situation, business owners should make a claim with their insurer.
Individual insurers will advise the process for lodging a claim and the timeframe for resolution of claims. Be mindful that thousands of insurance claims have been lodged and insurers are doing their best to address each one as quickly as possible.
Businesses should also contact their lender to advise of the situation that an insurance claim is being lodged. The lender will advise the process for pausing equipment finance repayments in this situation.
Finance for Replacement Machinery and Equipment
For business owners that are urgently wanting to quickly replace their machinery and equipment lost in the floods, you do not have to wait while your insurance claim is being processed. You can contact Jade Equipment Finance to immediately apply for equipment finance to acquire the new goods as a matter of urgency.
We provide finance for a wide range of plant, machinery and equipment, including:-
- Retail store fitouts
- Hospitality venue equipment including kitchen equipment, furniture and furnishings
- Agricultural machinery
- Yellow goods
- Trade tools and gear
- IT and computer equipment and systems
- And many more
Whatever equipment is required by a business, it is highly likely we can provide finance for its purchase. In addition, we provide other forms of business finance to assist flood victims including Business Overdrafts and Secured and Unsecured Business Loans.
Equipment Finance Applications in Progress
If affected by the floods and you have an equipment finance application in progress with Jade Equipment Finance that process will continue unless we are otherwise advised. We are operating as usual throughout this crisis to assist all of our new and existing customers.
If you would like to make changes to a finance application as a result of changed flood-related circumstances, please make contact with your consultant at Jade and we will advise you of the options.
For direct cash support, individuals and business should refer to the Federal Government Disaster Payments System and the relevant state bodies.
Speak with a Jade Equipment Finance consultant on 1300 000 003 to discuss equipment finance to replace flood-damaged machinery
DISCLAIMER: IF MISINTERPRETATIONS, MISREPRESENTATION OR ERRORS EXIST IN THIS ARTICLE, NO LIABILITY IS ACCEPTED. THE INFORMATION IS PROVIDED ONLY FOR GENERAL PURPOSES AND NOT IN ANY MANNER INTENDED AS THE ONLY SOURCE FOR MAKING FINANCIAL DECISIONS. THOSE THAT CONSIDER THEY REQUIRE ADDITIONAL GUIDANCE OR ADVICE SHOULD REFER TO AN INDEPENDENT FINANCIAL ADVISOR.