Outside financing gives businesses a way to smooth cash flow, pay routine expenses or fund expansion projects. Most likely you shopped around for the best terms available if your business turned to debt financing. Have you evaluated your options since then? If the answer is no, you may be missing out on the opportunity to considerably reduce your borrowing costs or borrow additional funds at a lower rate.

Declining interest rates typically drive borrowers to refinance. In today’s uncertain rate environment, you may think seeking a better deal is futile.

Here are four reasons you should consider refinancing your business loan or line of credit, regardless of the interest rate environment:

Your Business is Growing

If your business is more profitable now than when you originally applied for financing, you may be in a better position to take on additional debt to fund expansion projects, hire new employees or purchase new equipment. On the other hand, considerable growth often comes with more cumbersome processes to pay suppliers and employees. You may need a new line of credit to facilitate the accounts payable process.

Your Credit Profile Improved

If you’ve been diligent about paying off your debt and your profitability has increased, your business credit profile likely has improved. Even if you don’t need additional funding, you may be able to secure better terms on your existing debt. Refinancing at a lower interest rate can meaningfully reduce your borrowing costs, allowing you to put that extra money to work elsewhere.  

Your Technology Needs an Upgrade

Outdated equipment can slow you down and even cut into your profitability over time. Taking on additional financing to upgrade your systems and processes can help your business increase productivity and compete more effectively in your industry. Furthermore, the additional profit you might generate with better technology may offset the cost of borrowing.

You’re Considering an Acquisition

If you’re considering expanding through acquisition, working with an experienced banker to model the various scenarios and help guide you through the process can be invaluable.

Refinancing your debt—or borrowing additional funds at more competitive terms—is just one of the ways you can reduce your borrowing costs immediately and potentially boost your profitability over time.

If you are looking to expand your current business, acquire a new one, prepare for the unexpected or just manage the day-to-day, CIBC Commercial Banking has the depth of services and experienced team to help turn your ambitions into reality.

Patrick Putman is a managing director and leads the CIBC Commercial Banking team focused on the US southeast. With over 25 years of industry experience, Patrick is responsible for providing commercial clients with access to the full breadth of CIBC’s capabilities He serves as Chairman of ACG Atlanta, which recently won the ACG Chapter of the Year under his leadership.

Financing provided by CIBC Bank USA, Member FDIC and  Equal Housing Lender. Loans subject to credit approval. CIBC Bank USA and CIBC Private Wealth Group, LLC are both indirect, wholly owned subsidiaries of CIBC. CIBC Private Wealth Group and its subsidiaries do not provide, and are not responsible for, the products and services offered by CIBC Bank USA. CIBC Bank USA (Bank) will not pay employees of CIBC Private Wealth Group or its subsidiaries for referring clients to Bank, but to the extent permitted by applicable laws and regulations, the referral of clients to Bank for eligible products or services may be considered by CIBC Private Wealth Group in determining discretionary compensation to employees.