Early repayment charge: what it means for business borrowing
An early repayment charge (ERC) is a fee some lenders charge if you repay all or part of a loan before the end of its term or…
Business loans
Redemption statement: what it means for business borrowing
Redemption statement meaning: the lender's figure to repay a loan in full on a set date, with interest and fees. What it shows and how to request one.
In this guide
A redemption statement is the lender's written figure for paying off a loan in full on a specific date. It is the number a new lender or a solicitor needs before they can refinance or release security, because it includes everything owed up to that date, not just the capital.
What a redemption statement shows
- The capital outstanding.
- Interest up to the redemption date, often with a daily rate if completion slips.
- Any early repayment charge, exit fee or break cost.
- Administration or discharge fees for releasing the charge.
- The date the figure is valid until, and how to pay.
An example
A company refinancing a £250,000 secured loan asks its lender for a redemption figure for 30 November. The statement shows £231,400 of capital, £1,640 of interest to that date, a 2% early repayment charge of £4,628 and a £150 discharge fee: £237,818 in total, plus £63.40 for each extra day. The new lender's solicitor uses that figure to pay off the old loan at completion.
How to get one
Ask the lender in writing, quoting the account number and the date you want to repay. Your solicitor or the new lender can usually request it with your authority. Allow time: some lenders take several working days, and statements expire, so a delayed completion needs an updated figure.
£212,300A transaction we arrangedApproved, then nearly lost at completion. £212K consolidated.A property-title requirement threatened a consolidation deal at the last hurdle. We worked it through and kept the structure intact.Why it matters when you borrow
The redemption figure decides how much new borrowing you need, so a refinance is sized on it. Once the loan is repaid, the old lender should release its security: for a company, a statement of satisfaction (form MR04) can be filed at Companies House so the charge shows as satisfied.
If you are refinancing, see refinancing business loans or commercial property refinance. We search the market and work from your redemption figures. Any broker fee depends on the lender, with nothing to pay upfront.
Related terms
Sources
This guide is general information, not financial advice. Lenders set their own criteria, rates and terms, and all finance is subject to status.
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FAQs
Common questions
Is a redemption statement free?
Many lenders provide one free, but some charge an administration fee, especially for repeat requests. Check your loan terms.
Does asking for a redemption statement commit me to repaying?
No. It is a quotation of what you would owe on a given date. You only repay if you go ahead.
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