Learn To Be A Fix & Flip Investor: business loans

Showing posts with label business loans. Show all posts

Friday, February 24, 2017

Simple Steps to Securing a Business Loan

So, you have made a big enough dent in your industry to take your small business to the next level. Well, let’s celebrate with a how-to-guide on securing a business loan, shall we?

Surprise! If you didn’t know by now that you were going to need outside financing to take your small business next level, well now you know. The truth is as your business starts to grow simple things like payroll and inventory that use to take you a few hours to complete now take days or even months alone. So, what else can you really do but choose to expand?

Yet, since you are considered a small business by most lenders, you will quickly find that it is somewhat difficult to secure a business loan initially. But, that doesn’t mean it’s impossible. In fact, the best way to secure a business loan for your small business is to get in the know and start applying. By “get in the know” we mean understanding why you need the money, narrowing down your loan options or types, finding the lender that gets you and seeing if you qualify. After all of this is accomplished, really all that’s left is to get the necessary documents together and apply.

But, wait this sounds fairly cut and dry. It may seem so cut and dry, in fact, that you are wondering why people say it is difficult for small business owners to secure additional financing? Well, the obvious answer is, it’s more about qualifying or rather meeting your lender’s requirements than it is about getting your paperwork together and coming up with a clear plan. But, the good news is by getting in the know i.e. completing the above-mentioned steps you will actually make it much easier for yourself and your business when it comes time to meet those pesky lender requirements.

How to Get in the Know

When meeting with potential lenders or your future lender it is important to know exactly why you need this loan, so again make sure you know as well and preferably beforehand. Next, you need to decide which loan is right for you. This step is actually not as hard as it seems because if you know why you need the loan then you can find the right loan. For instance, if you are looking for some financial assistance in managing the day-to-day expenses more than likely you want a short-term cash flow loan or a line of credit. If on the other hand, you want an additional financing to grow your business then you should be looking at term loans. Based on these two steps, your next move is, of course, finding the right lender (note: if you have bad credit you might want steer away from traditional lenders).

Exceed Your Lender’s Expectations

So how does all of this help you exceed your lender’s expectations? Well, it makes it much easier to figure out key factors that affect your approval such as your credit score and it helps you to see if you are truly in a position to secure a loan( been in business more than 2 years, meet the minimum annual revenue requirement and have the ability to make payments).

About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

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Small Business Must-Haves when Applying for a Business Loan

You probably heard it all before, you absolutely need this piece of documentation and this info regard x and this report to explain y when applying for a business loan. But, if you are like most people, after a while you get lost in all the noise and simply aren’t sure what you truly need when applying for a loan.

As a small business, you are more than likely just getting your feet wet when it comes to applying for a business loan, which is perfectly okay. Everyone once had to start somewhere and additional financing for any business can be a godsend. With that being said, let’s make it a little easier to get your business loan by cutting through some of the red tape.

For starters, it is true that you will need important documentation such as your business and personal tax returns. You will also need your business and person bank statements, your business financial statements as well are your business legal documents i.e. articles of incorporation, your commercial lease, franchise agreement and so on. Your lender may not necessarily require all of these items but it is always in your best interest to have these items on-hand when trying to secure your business loan.

Nevertheless, at this point, you are probably looking for those must-haves that were mentioned earlier and rightly so. Obviously, some of these top must-haves will not be revolutionary i.e. it is not shocking that you need strong credit to secure additional financing for your business. But, other must-haves like an updated, detailed business plan that even covers your social media presence kind of is revolutionary; since only as of recent have lenders started to factor a company’s social media presence into their overall decision to approve financing.

Be Successful and Be Prepared

Other must-haves you should have handy when applying for your loan include a compelling personal resume, credible P&L statements and in-depth knowledge of the actual loan you are trying to secure. A compelling personal resume makes the list of must-haves because traditional lenders as well as most lenders in general want to know that they are investing in a qualified individual. Obviously, your ability to run your business successfully hinges on your skills, talent and know-how, so don’t be afraid to show it. Additionally, when it comes to your personal resume make sure you thoroughly proofread it and edit your resume to near perfection. In terms of having credible P&L statements, this means your P&L statements should speak to your reliability, ethicality, and professionalism. Lastly, you already know that knowledge is power so if you truly want that loan, take the time to research your many lending options and pick the right loan the first time.

The Benefits

Clearly, the benefits of being well-prepared and on top of all your lender’s must-haves means that you are more than likely to secure that loan of yours. So, don’t think you can just fill out an application and wing it. Today’s lenders aren’t afraid to turn a small business down so you shouldn’t give them a reason to.

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Thursday, February 23, 2017

More than a Standard Business Loan

With a large chunk of your business loan research under your belt, you may feel as though you are clear on all your options. But, you might pleasantly surprised to know that there are more than traditional term loans, short-term loans, personal loans for businesses, business credit cards and lines of credit available when it comes to securing additional financing.

So, if you are like most newbies in the business world, you have probably been led to believe that a “standard” business loan is the only way to go when it comes to securing additional financing. Well, get ready to be shocked and amazed or rather just better informed. The fact is you can apply for a standard business loan and/or explore several different lending options.

For instance, you may or may not know about SBA loans. SBA loans are basically a long-term and low-interest loan for small businesses that is partially guaranteed by the government. The reason you may not have heard of SBA loans is because they are hard to come by as they often involve lengthy paperwork, longer approval times and collateral that you may not have available. Nevertheless, SBA loans still offer some of the lowest down payments and terms. Moreover, these loans come with reasonable interest rates and can ultimately be used for a wide variety of business purposes.

In addition to the existence of SBA loans, you may also be surprised to know that there are lenders (private, family and alternative) out there that are sympathetic to your start-up state i.e. these specific lenders offer start-up loans. Start-up loans are, in essence, any kind of financing aimed at helping businesses with no business history. You can also use business assets that are already in your possession. In other words, you can use such things as your accounts receivables or business equipment in order to secure additional funding.

How to Secure Additional Financing In-house

In-house financing, if you will, is when you utilize such things as your accounts receivables or invoices as collateral. This essentially means that you sell your invoices to another entity in order to not have to wait for payment which in turn provides you with the cash flow you would have eventually received had your customers paid. As an additional financing option, this can be advantageous if you only need the amount of your outstanding invoice, though it is important to note that fees are typically the downside to this kind of financing. Similarly, equipment financing is yet another in-house option where you are able to receive a loan for new equipment by using that new equipment as collateral. Equipment financing is a great way to have quick access to cash with very little paperwork, but keep in mind that equipment depreciates which can and will affect your bottom line.

Things to Consider with a Merchant Cash Advance

Another rarely-discussed option is merchant cash advances. This is basically a lump sum of additional financing that you gradually repay via a portion of your daily credit card transactions. This particular option is definitely the quickest and easiest way to get additional funds, but it also the most expensive—so choose wisely.

Technorati Tags: business loan,business loans

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Friday, February 24, 2017

Simple Steps to Securing a Business Loan

Small Business Must-Haves when Applying for a Business Loan

Thursday, February 23, 2017

More than a Standard Business Loan

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