What happens when an overdraft comes up for annual review?
An overdraft or line can be subject to periodic review. The lender may ask for updated financial information, check conduct and reassess the limit, security and covenants. Treat the review date as part of the facility risk.
What changes the answer
Keep management accounts and cash-flow forecasts current rather than waiting for review.
Understand whether the facility is on-demand, annually reviewed or committed for a defined term.
What to check before acting
A business that permanently relies on the full limit should test whether some debt belongs in an amortising term facility.
- Use your actual balance, price, term and fees.
- Keep the comparison on the same time horizon.
- Check any tax-sensitive or contract-specific point against the current source document.
Use the enquiry form for an initial broker review. No lender application is made just by enquiring.
Compare working-capital structuresSources and verification
General information only. It is not personal financial, tax or legal advice. Finance approval, pricing and structure are subject to lender assessment and your circumstances.