Business Loans

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Your business is doing well. Your customer base is growing, and during the last quarter you actually turned a profit for the first time since you opened your doors last year. You have a solid business plan and now it’s time to think about moving out of your rented space, buying more equipment, or perhaps hiring more employees.

Perhaps your business is profitable but during your slow season you’re short of cash. Or your delivery truck just broke down and you have decided its time to get a new one. You need to get cash to keep your business moving forward.

Where do you start? The good news is that there are a wide variety of credit and loan programs available that can be applied to almost any business situation. The bad news is that the choices can seem complex and overwhelming. Here are some options that a small business owner can consider. read more »

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Running a business is not an easy task and the need of financing is a must. However, a business owner wants a cheap source of financing and not rates that eat up all revenue. Unsecured lines of credit are either too expensive or not available for small businesses. Thus, if the business does not have sufficient assets the owner may have to use his own personal assets. Fortunately there is another solution to secure a loan for your business: the use of the business’ income.

Your business may produce money but it probably does not do so at the rate you want and with the exact timing you need. That is why all businesses need some sort of financial source and secured ones provide a cheap source of funds. There are loans and lines of credit provided both by financial institutions and banks that can be secured with the company’s income in different ways and that can provide all the financing your business needs.

Bank Or Financial Institution Line Of Credit

Your current bank or any financial institution can provide you with a line of credit or a loan based on read more »

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One of the most prominent changes with every lender in today’s market are the stricter underwriting guidelines they are imposing on all their borrowers. Because of their previous lackadaisical approach, many lenders have found themselves in great trouble with many closing their doors and claiming bankruptcy. The lenders who are still in business now realize the importance of sound underwriting on all of the loans that come across their desk.

When a loan request is submitted to a lender, a loan processor is typically assigned to the loan to gather all of the necessary documents that the underwriter will need to evaluate the loan and to make sure the borrower will be able to make their payments and still have a reserve for emergencies. The documentation they will require is also required by the regulators that the banks have to answer to. Because of the mortgage crisis, regulators are running around as fast as they can and are extremely picky with what they need as documentation.

While this should have been happening over the past years, it has caused banks to reorganize their underwriting departments and request for more information than they need to ensure they will meet the regulators stringent requirements so they can keep lending. Many of these changes have increased the underwriting process and the amount of paperwork the borrowers need to collect. read more »

Obtaining capital in this “tight money market” is easier said than done these days. As more and more banks go belly up, lenders are increasingly making it more difficult to obtain capital. I will show you how it is possible, even in this market, to obtain unsecured business funds without having to show business bank statements, tax returns, balance sheets, profit and loss statements, etc. Although you won’t need any financial documentation, you may need a simple business plan.

Make sure when you are working with a lender that you pay absolutely zero “upfront fees” or “application fees.” Applying for business capital should not have to cost you anything up front. Most lenders should charge their fees from the “back end” (proceeds of the line of credit). Keep in mind that most unsecured “no doc” business loans will come with a higher price tag than one that is secured and is “full doc” (bank statements, business tax returns, etc.). Reason is pretty simple; funding unsecured, no financial business loans poses a higher risk to the lender. read more »

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Last week I conducted an exploratory marketing session with a new business owner. One of the topics that came up was how tough the credit crunch has made it for businesses to get financing. And that got me thinking…

For several years I’ve championed the concept of growth through leveraging marketing assets. Assets that already exist within companies. This approach frees the business owner from worries that come from having to ‘beg’ a banker for money. And there’s no need to give up a portion of your company to venture capitalists either.

If you have an existing business, the easiest way to increase your operating capital isn’t to go get more loans. Business finance should be your last option. Most people balk at this thought. This is a mindset problem. I know. I worked in banking for ten years. The idea of leveraging marketing assets never occurs to business people. They have been conditioned to think the money must come from someone else. read more »

photo credit: MTN_CompanyThe sky is falling! Run for your life! The banks aren’t lending! Well, the first two might be correct, but the last one is not. Commercial banks are lending, but they are very picky.

Private lending practices are known for being very forgiving and very sloppy. One needs look no further than the current financial mess to realize as much. Banks were handing out money to pretty much anyone who asked for earlier this decade. The result? An overheated housing market that finally collapsed and is even now taking down banks right and left with it.

Commercial banking is a part of the financial industry that bears little resemblance to personal finance. In fact, about the only common factor is both have the word “banking” in them. Other than that, the process of successfully applying for a loan is very different. Regardless of the type of commercial loan you are seeking, there are always four basic components you need to be strong on. read more »

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I am frequently approached by business owners seeking financing for their companies. It’s become a love-hate scenario. I love it because that’s what I do, arrange financing for small businesses. I don’t enjoy it as much when I soon realize that the business owner often doesn’t know why they need the money, how the money will help their business, or if they can afford to take a loan.

I’m surprised at the number of business owners that haven’t taken the time to determine how they plan to use the money. Most of them believe they need to do more marketing or buy more equipment, but they haven’t figured out their estimated return on investment or what they really expect to get in the end. There are 3 quick planning and analysis steps every business owner should perform before seeking to take on a loan or other commercial financing:

1) Analyze your current situation to determine the problem you’re trying to solve. This may differ for start-ups versus established businesses. As a start-up, you may be seeking financing to lease equipment to get the business operating or advertising dollars to notify your target market they need your product or service. read more »

photo credit: norhendraruslanA working capital loan is a form of business loan that is commonly allocated to support the daily operations of a business or buy earning assets. This source of funding is often sought when the net working capital is deficient. This circumstance results from a low or even negative figure when the existing liabilities in the form of accounts payable are subtracted from the current asset comprising of accounts receivable and inventory.

For most businesses, their objective in acquiring a working capital loan is to make sure that the business operations are continued until such time that the cash flow coming in is sufficient enough to accommodate the upcoming operational costs as well as the maturing short-term debt.

Working capital loan is ideal for whatever business situation whether an emergency crisis or pursuing a new venture for development. It poses as a great option to come up with a quick source of funds. When you have already decided that a working capital loan is right for you, one thing to learn about it is that different traditional financial institutions may refer to it in varying terms or it comes in different forms such as: read more »

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There are several ways to obtain funding for your business; the most common lender is the traditional bank, credit unions and private loan companies or capital companies. Through these types of lenders, business loans must be secured. This means using your personal assets as guarantee (collateral). Business loans are very risky because there are fixed monthly payments that don’t change, even if your sales go down, besides the application process is very complicated and it takes a long time until funding occurs, that’s assuming you even qualify, as the lender will require credit scores of over 750.

Banks may also ask that a business have a co-signer or guarantor. This means finding a financial partner or even checking into the various types of small business loans that the government offers as help to small business owners. Minorities and women certainly have a wider selection of companies willing to loan them working capital. The Minority Business Development Agency (MBDA) read more »

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Aged Shelf Corporations & ELOC’s can help protect & grow your businesses in many different ways.

1. Owners should convert existing personal businesses into corporations

2. Establish corporate history, trade lines, and protect personal credit and assets.

3. Owners want to establish business trade lines in the business name instead of using there personal credit or loans.

4. Business has grown or wants to expand out side of local area, vendors asking for personal guarantee or company Duns Number for validation.

5. Owners or entrepreneurs want or need to acquire larger corporate credit lines, Credit card lines of credit, and bank loans to finance a variety of small to mid-size businesses necessities.

6. There are a million different reasons why owners & entrepreneurs need aged corps

Do not waste time building corporate credit if your plan for funding is now. read more »