Manufacturing Business Loans: Refinance Machinery & Release Working Capital

Short answer: Yes — UK manufacturers can often refinance existing machines to unlock working capital. UK Business Loans doesn’t lend directly but will match your company with specialist lenders and brokers offering asset refinance, sale‑and‑leaseback, hire purchase refinancing and secured asset loans for deals from about £10,000 upwards. Get a fast, no‑obligation assessment today: Get Quote Now — Free Eligibility Check.

Quick snapshot: can manufacturers refinance machinery via UK Business Loans?

Yes — provided your business owns (or has sufficient title/authority over) the equipment and the asset has resale or lending value, manufacturers can convert machine value into cash. How much and how quickly you can raise funds depends on the machine’s age, condition, remaining useful life, outstanding finance and sector risk.

• What UK Business Loans does: we match you, free and without obligation, to brokers and lenders who specialise in manufacturing asset finance and working capital solutions.
• Typical deal size: from around £10,000 upwards for asset refinance and sale‑and‑leaseback facilities.
• Start here: Free Eligibility Check — the enquiry is not an application and won’t affect credit scores.

What “refinancing machinery” means for manufacturers

Refinancing machinery converts an owned or financed physical asset into liquidity. Options vary by outcome:

• Pay off or replace an existing equipment loan or hire purchase to reduce monthly outgoings or get better terms.
• Sale‑and‑leaseback: sell the asset to a funder and lease it back for continued use while releasing capital.
• Asset‑backed loan: borrow against the asset’s value while keeping it in use.
• Consolidate multiple high‑cost debts using the asset to secure a single, more manageable facility.

Finance types that refinance machinery

Asset refinance / asset finance

Asset refinance replaces or remortgages an existing asset loan. Lenders value the equipment and offer cash or a new facility that settles prior finance. Typical terms: 1–5 years (often longer for larger machinery). Pros: retain use of equipment, potentially lower monthly cost. Cons: lender takes a charge over the asset.

Sale & leaseback

With sale & leaseback you sell machinery to a financier and lease it back — immediate cash injection while operational control remains through a lease. Ideal for high‑value, well‑maintained kit. Typical sizes: £25k to multi‑million. Pros: large cash release, offloads ownership risk; cons: ongoing rental cost and possible tax/accounting impacts.

Hire purchase refinance & consolidation

If equipment is on hire purchase you can refinance remaining HP balances into a new HP or loan, often to reduce monthly payments or consolidate multiple hires into a single facility.

Secured business loans / asset‑backed loans

These are term loans secured against machinery (and sometimes other company assets). They can offer competitive pricing for businesses with valuable, saleable equipment.

Alternative cashflow options

While not equipment refinance themselves, invoice finance and stock financing can be complementary ways to release working capital without touching asset title. Explore alternatives via our partners if asset refinance isn’t suitable.

Who can refinance machinery — eligibility & lender criteria

Lender appetite varies, but common requirements include:

• Clear ownership or the ability to transfer title (owned outright or with a solvable outstanding balance).
• Machinery age and condition: newer and well‑maintained machines command higher values.
• Industry and asset type: standard CNCs, presses and plant are easier to value than bespoke tooling.
• Trading history and annual turnover — lenders typically prefer established limited companies with proven accounts.
• Evidence: purchase invoices, maintenance logs, serial numbers, photos and any existing finance statements.
• Outstanding finance declared — many lenders can refinance existing balances but will need settlement figures.

Note: very old, bespoke or heavily customised assets with low secondary market value can be hard to refinance.

Benefits: why manufacturers refinance equipment

• Immediate working capital — free up cash for raw materials, payroll or new contracts without moving premises.
• Debt consolidation — replace several high‑cost facilities with a single product.
• Keep producing — sale‑and‑leaseback keeps machines in operation while freeing funds.
• Preserve bank lines — release cash without exhausting overdrafts or bank facilities.
• Improve monthly cashflow — refinancing can lower monthly repayments or spread cost more sensibly.

Example: a sheet‑metal firm released £70,000 against older presses, used the cash to buy materials for a large contract and repaid the facility from contract progress payments.

Risks & things to watch

• Costs: interest, arrangement fees, valuation and legal fees — compare total cost of finance not just headline rate.
• Security: lenders often take a fixed or floating charge over assets — failure to pay can lead to repossession.
• Accounting & tax: sale & leaseback and secured loans have different balance sheet and tax implications — consult your accountant.
• Early repayment penalties: check for exit fees on existing finance and new facilities.
• Valuation uncertainty: specialist valuations may reduce expected release value for unusual or bespoke machines.

We never guarantee offers — rates and availability depend on lender appetite and your circumstances.

How UK Business Loans helps — our process

Here’s how we match manufacturers to the right funding options:

1. Complete a short enquiry (under 2 minutes) — Get Started.
2. We match your business to lenders and brokers specialising in manufacturing equipment finance and asset refinance.
3. Selected partners contact you for a free eligibility check and indicative quotes (often within hours).
4. If you choose to proceed, lenders perform valuations and due diligence and issue formal offers.

We make one introduction that connects you to the best potential provider for your needs. UK Business Loans is an introducer — submitting an enquiry is free and not an application. Our service normally covers lending opportunities from about £10,000 and up. For more detail on how we support manufacturing firms, see our wider manufacturing resources on manufacturing business loans.

Get Quote Now — Free Eligibility Check

Typical timeline & paperwork

• Initial enquiry: minutes.
• Preliminary lender contact & indicative decision: 24–72 hours.
• Valuation and on‑site inspection (if needed): 3–14 days depending on asset size and location.
• Completion/funding: a few days for small deals, several weeks for larger, bespoke transactions.

Common documents lenders request: purchase invoices, ownership title, serial numbers, maintenance records, recent accounts, bank statements and details of any existing finance.

Case examples (anonymised)

Case 1 — CNC workshop (sale & leaseback)

A medium CNC subcontractor needed cash to fulfil a large order. A sale & leaseback of three machines released £150,000 within three weeks. The business retained full operational use under a lease while using cash to buy materials and hire staff.

Case 2 — Sheet‑metal manufacturer (asset refinance)

An established sheet‑metal firm refinanced two older presses and consolidated high‑cost credit lines. The refinance released £70,000, reduced monthly finance costs and simplified repayments into a single term facility.

Frequently asked questions

Can I refinance machinery that still has existing finance on it?

Often yes — but you must disclose outstanding balances. Some lenders will refinance an existing lender’s balance and settle them directly, subject to settlement figures and valuation.

How much can I expect to raise?

It varies by asset. Typical advance rates depend on the machine’s resale value and condition; small‑value kit might yield a modest release while high‑value plant can release a significant sum. Provide asset details for an indicative figure via our Free Eligibility Check.

Will submitting an enquiry affect my credit score?

No — submitting an enquiry via UK Business Loans is a soft, no‑obligation step and will not affect your credit score. Lenders may carry out credit checks later if you pursue a formal application.

How are sale‑and‑leaseback payments treated?

Lease payments are an ongoing operating cost. The accounting and tax treatment can vary — discuss with your accountant to understand balance sheet and tax impacts.

What fees should I expect?

Possible fees include valuation fees, arrangement fees, legal costs and early settlement fees on existing finance. Ask lenders for a full illustration of costs before accepting any offer.

Do you charge manufacturers to be matched with lenders?

No — our introduction service is free to businesses. We earn commission from lenders/brokers after successful introductions; there’s no charge to submit an enquiry.

Next steps

If you’re a UK manufacturer with owned machinery that you’d like to convert into working capital, start with a quick eligibility check. It’s free, takes under two minutes and won’t affect your credit score: Get Quote Now — Free Eligibility Check.

Important: UK Business Loans is an introducer, not a lender or financial adviser. Submitting an enquiry is free and will not affect your credit score. Lenders and brokers may perform checks and will provide terms if you proceed. Seek professional tax and accounting advice where needed.

Looking for broader industry support? Read more about our manufacturing business loans and how specialist lenders work with manufacturers: manufacturing business loans.

– Can UK manufacturers refinance machinery to release working capital?
Yes — many UK manufacturers can refinance owned machinery via asset refinance, sale‑and‑leaseback, hire‑purchase refinance or secured asset loans to unlock working capital depending on the asset’s value, age and condition.

– What types of finance refinance manufacturing equipment?
Common options include asset refinance, sale‑and‑leaseback, hire‑purchase refinance and secured asset‑backed loans, with invoice or stock finance available as complementary alternatives.

– How much can I expect to raise against my machinery?
Amounts vary by resale value and condition but UK Business Loans typically handles deals from around £10,000 upwards, with high‑value plant able to release substantially more.

– Will submitting an enquiry through UK Business Loans affect my credit score?
No — submitting a free eligibility enquiry is a soft, no‑obligation step and won’t affect your business or personal credit score, though lenders may carry out checks later if you proceed.

– How quickly can I get cash from a sale‑and‑leaseback or asset refinance?
Small, straightforward deals can fund in days to a few weeks, while larger or bespoke machinery transactions often take several weeks after valuation and due diligence.

– What paperwork and information do lenders need to value equipment?
Lenders typically request make, model and serial numbers, purchase invoices, maintenance records, photos, current usage and details of any existing finance, with on‑site valuations for high‑value kit.

– Who is eligible to refinance machinery?
Lenders usually prefer businesses with clear ownership or transferable title, well‑maintained machines, established trading history and recent accounts, though criteria vary by lender and asset type.

– What fees, risks and accounting impacts should I watch for?
Expect arrangement, valuation, legal and possible early‑settlement fees, plus security charges that can lead to repossession on default and differing tax/accounting treatment for sale‑and‑leaseback versus loans.

– How does UK Business Loans help and does it cost anything?
UK Business Loans is a free introducer that matches you to specialist brokers and lenders for a fast eligibility check and indicative quotes, and we do not charge businesses for this service.

– Are the lenders and brokers you match me with regulated and trustworthy?
Yes — UK Business Loans works with reputable, approved partners who operate under FCA guidelines and industry best practice to ensure fair, transparent lending.