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The associated document fees related to a standard UK finance agreement

Guest post by: Al Shea

Article Overview: With most finance companies, there is a standard document fee payable on activation of your finance agreement. This can be called an acceptance fee, documentation fee, activation fee, or similar. This article explains the finance document fees in more detail.

The associated document fees related to a standard UK finance agreement

Almost every funder in the UK will charge you a documentation fee when they write a business finance deal for you. This is something that has been in place since the very start of business finance agreements and is set to continue in the future. Documentation fees vary in price, some funders will only charge you £75 to activate a finance agreement where others will charge you £150 or in some cases 1% of the invoice value. A typical documentation fee in the UK is currently around £125. On top of the documentation fee, more funders are starting to charge annual fees for the maintenance of the agreement. This is typically £50 per year and is taken automatically on the anniversary of the deal each year until it has run its full course. Annual fees are becoming more commonplace in the UK in the current financial economy where bad debtlevels arehigh and the funders need to look at new ways to help increase their margins.

They are the only standard fees typically associated with a business finance agreement, however there may also be other fees if you choose more specialist terms, ie if you want to pay via invoice rather than direct debit - this can normally mean a charge of £25 per invoice or 2% of the monthly payment, whichever is greater. So it always pays to go on Direct Debit. Also, if you are looking at secured finance, ie where the funder takes a charge over your freehold property, there will usually be a legal fee charged to cover the funders time spent with the solicitors agreeing/raising the legal documentation. This can be up to £500, although some funders offer to refund this fee once the charge is successfully in place.

If you are in any doubt about business finance documentation fees, read through the terms and conditions of the agreement carefully, as this will details all the fees clearly.

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Article Tags: activation fee, document fee, document fees, documentation fee, finance agreement, finance companies, uk finance



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