Expert view: Why due diligence is a two way street

Seeking funding is an important step for any business. You are entering into a relationship with your funder and you need to be sure that they are right for you.

If you are having problems with your business always seek help initially from a source you can trust.

If your business is growing and you want to fund growth or an acquisition, again your accountants should be the first port of call.

Additionally, borrowers need to look at what rates of interest lenders will expect. Usually the greater the lender’s exposure to risk, the higher the interest rate.

When looking at offers of funding it is always important to get expert legal advice. Agreements from any lender are complex and binding documents and the devil really is in the detail; much of it in legal terminology which can be a minefield. The rule is: always get someone to help you understand exactly what your position will be in the worse-case scenario.

• In association with Haworths.
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