July 30th, 2009 at 11:53pm
Under Commercial Loan
There were both positive and negative developments for business loans during 2007. These will have an immediate impact on business financing strategies for borrowers.
When reviewing commercial loan developments that occurred during the past 12-18 months, there are mixed results when looking at the best and worst trends. Many of the working capital changes that emerged last year have important ramifications for borrowers refinancing or seeking new financing.
A major commercial property investment trend has been some increasing activity due to the current decline in viable residential investing options. This seems to be particularly true for business opportunity situations which do not have a real estate component, an aspect of increasing importance to investors who want to avoid property ownership at this time.
For business cash advance and credit card processing services, the past 12 months have been characterized by significant changes. There were many providers both entering and exiting these business activities. It is of course good news that some ineffective providers were forced to leave this specialized working capital management service area. But the bad news is that there are still many new and inexperienced companies attempting to operate in this complex field.
A similar trend involving inexperience can be seen in viewing the large number of residential financing brokers now attempting to transition into business financing. Since by some estimates well over 100,000 residential financing employees lost their jobs during 2007, there is a real possibility that thousands of unqualified brokers will be entering the business finance field during 2008 or have already started the process.
A general business loan trend impacting refinancing is the reduction in loan-to-value ratios, especially when borrowers are attempting to get some of their equity out of the business in cash. For purchase situations including special purpose properties such as church financing, slightly larger down payment requirements are increasingly more common.
During 2007 there was also noticeable attrition in SBA loan providers. This is primarily a positive development, since the field has long been overpopulated with inadequate business lenders.
Likewise many local and regional banks visibly reduced or eliminated their business financing activities during the past 12 months. The bad news about this trend is that very few former commercial lenders provided their borrowers with adequate notification of their intent to exit the business. If there is a positive aspect to this development it is probably that many borrowers confronted with the need to suddenly find alternative commercial financing sources have often ended up with much better terms by dealing with a new lender that specializes in commercial real estate financing and working capital management.
Although the general decrease in interest rates during the past year is a positive development, there will probably be some confusion among commercial borrowers who have adjustable rate terms when they do not see their rates reduced. In all likelihood, this will be due to a common clause applied to most commercial loan contracts that stipulate that the minimum rate for such agreements will never be less than the initial rate. With such a floor rate provision, this means that if a borrower starts with an adjustable rate set at 10% and then rates fall, the effective loan rate will remain at the initial rate.
By Credit Info
July 30th, 2009 at 05:49pm
Under Credit Line
As a result of an increasing commercial financing crisis, commercial borrowers are evaluating new alternatives for business finance funding. Business cash advances and credit card financing are two working capital financing options which have proven to be effective and practical sources of operating cash for small business owners.
The use of credit card financing often refers to business cash advances in which working capital is obtained by business owners based upon future credit card processing activity. Alternatively the use of personal credit cards to obtain a cash advance is also referred to as a credit card loan. With business finance funding shortages, small business owners are increasingly using both approaches to obtain operating cash for their business. The two financing approaches are not equal in terms of how they are viewed by commercial financing experts although the strategies might be called by the same name occasionally.
Many commercial lenders have suddenly reduced or cancelled business lines of credit and other forms of working capital loans. In response, many business owners have been forced to rely on cash obtained via their personal credit cards to sustain their businesses. In order to prepare for several of the most undesirable actions being taken by many credit card loan lenders, we urge all commercial borrowers to review the predatory lending discussion in The Working Capital Journal.
For business owners using or about to use personal credit cards to secure operating capital, we want to make two important comments: (1) We consider this to be a last resort method of business financing and whenever possible it should be avoided. Before assuming that this is the only source of capital available, commercial borrowers should consult with a working capital finance expert. The possibility of business cash advances and working capital loans should be thoroughly explored. (2) This questionable method of obtaining commercial finance funding will prove to be increasingly more difficult because credit card issuers are already cutting back on their unsecured lending programs.
Most banks are doing with credit cards what they have already done with business line of credit programs. They are reducing or cancelling credit lines even when borrowers have a superb payment record. The current basis for bank reductions of both commercial lines of credit and credit card cash is based on similar rationale. With unsecured commercial loans or personal loans, banks fear that massive defaults are almost inevitable due to a very shaky economy and business lending climate. Unlike residential real estate financing in which real property is pledged as collateral, banks know that they have no collateral to fall back on with working capital loans and credit card loans because they are unsecured. Many small business owners use home equity lines of credit to obtain operating cash, and these funding sources are also diminishing in most areas of the United States. Although these lending programs are backed by collateral, the value of homes in many areas has decreased to the point that many outstanding loans exceed the current property value.
One of the most disturbing and frustrating occurrences in the current difficult commercial financing environment is the lack of clear information for many business owners about which funding options are realistic and possible. Thousands of borrowers might have obtained operating cash from personal credit cards when there were better options for this one factor alone (confusion and misinformation).
Due to the growing tendency of several major credit card issuers to exhibit predatory lending practices, the use of personal credit card loans should be avoided. At a minimum, each business owner should contact a business finance funding expert to determine if a business cash advance program or a working capital loan program can be used to obtain needed cash.
By Credit Info
July 30th, 2009 at 05:49pm
Under Credit Line
As a result of an increasing commercial financing crisis, commercial borrowers are evaluating new alternatives for business finance funding. Business cash advances and credit card financing are two working capital financing options which have proven to be effective and practical sources of operating cash for small business owners.
The use of credit card financing often refers to business cash advances in which working capital is obtained by business owners based upon future credit card processing activity. Alternatively the use of personal credit cards to obtain a cash advance is also referred to as a credit card loan. With business finance funding shortages, small business owners are increasingly using both approaches to obtain operating cash for their business. The two financing approaches are not equal in terms of how they are viewed by commercial financing experts although the strategies might be called by the same name occasionally.
Many commercial lenders have suddenly reduced or cancelled business lines of credit and other forms of working capital loans. In response, many business owners have been forced to rely on cash obtained via their personal credit cards to sustain their businesses. In order to prepare for several of the most undesirable actions being taken by many credit card loan lenders, we urge all commercial borrowers to review the predatory lending discussion in The Working Capital Journal.
For business owners using or about to use personal credit cards to secure operating capital, we want to make two important comments: (1) We consider this to be a last resort method of business financing and whenever possible it should be avoided. Before assuming that this is the only source of capital available, commercial borrowers should consult with a working capital finance expert. The possibility of business cash advances and working capital loans should be thoroughly explored. (2) This questionable method of obtaining commercial finance funding will prove to be increasingly more difficult because credit card issuers are already cutting back on their unsecured lending programs.
Most banks are doing with credit cards what they have already done with business line of credit programs. They are reducing or cancelling credit lines even when borrowers have a superb payment record. The current basis for bank reductions of both commercial lines of credit and credit card cash is based on similar rationale. With unsecured commercial loans or personal loans, banks fear that massive defaults are almost inevitable due to a very shaky economy and business lending climate. Unlike residential real estate financing in which real property is pledged as collateral, banks know that they have no collateral to fall back on with working capital loans and credit card loans because they are unsecured. Many small business owners use home equity lines of credit to obtain operating cash, and these funding sources are also diminishing in most areas of the United States. Although these lending programs are backed by collateral, the value of homes in many areas has decreased to the point that many outstanding loans exceed the current property value.
One of the most disturbing and frustrating occurrences in the current difficult commercial financing environment is the lack of clear information for many business owners about which funding options are realistic and possible. Thousands of borrowers might have obtained operating cash from personal credit cards when there were better options for this one factor alone (confusion and misinformation).
Due to the growing tendency of several major credit card issuers to exhibit predatory lending practices, the use of personal credit card loans should be avoided. At a minimum, each business owner should contact a business finance funding expert to determine if a business cash advance program or a working capital loan program can be used to obtain needed cash.
By Credit Info
July 26th, 2009 at 11:51am
Under Credit Line
In the face of a growing commercial finance funding crisis, many small business owners are exploring new options for commercial financing. Credit card loans and business cash advances are two working capital financing strategies which are proving to be practical and effective sources of operating cash for commercial borrowers.
The use of credit card financing often refers to business cash advances in which working capital is obtained by business owners based upon future credit card processing activity. Alternatively the use of personal credit cards to obtain a cash advance is also referred to as a credit card loan. With business finance funding shortages, small business owners are increasingly using both approaches to obtain operating cash for their business. The two financing approaches are not equal in terms of how they are viewed by commercial financing experts although the strategies might be called by the same name occasionally.
Many commercial lenders have suddenly reduced or cancelled business lines of credit and other forms of working capital loans. In response, many business owners have been forced to rely on cash obtained via their personal credit cards to sustain their businesses. We strongly urge all commercial borrowers to review our predatory lending discussion in The Working Capital Journal in order to prepare for some of the most undesirable actions being taken by many lenders which have a substantial credit card loan exposure.
There are two particular observations we want to emphasize about small business owners using personal credit cards to obtain operating cash: (1) This really is a business financing method of last resort that should be avoided whenever possible. Before assuming that this is the only source of capital available, commercial borrowers should consult with a working capital finance expert. The possibility of business cash advances and working capital loans should be thoroughly explored. (2) This questionable method of obtaining commercial finance funding will prove to be increasingly more difficult because credit card issuers are already cutting back on their unsecured lending programs.
Like reductions in their lending programs for business lines of credit, most banks are now making similar cutbacks in credit card lending. They are reducing or cancelling credit lines even when borrowers have a superb payment record. The rationale for banks reducing both credit card lines and commercial lines of credit is similar. With unsecured commercial loans or personal loans, banks fear that massive defaults are almost inevitable due to a very shaky economy and business lending climate. Unlike residential real estate financing in which real property is pledged as collateral, banks know that they have no collateral to fall back on with working capital loans and credit card loans because they are unsecured. Many small business owners use home equity lines of credit to obtain operating cash, and these funding sources are also diminishing in most areas of the United States. Although these lending programs are backed by collateral, the value of homes in many areas has decreased to the point that many outstanding loans exceed the current property value.
One of the most disturbing and frustrating occurrences in the current difficult commercial financing environment is the lack of clear information for many business owners about which funding options are realistic and possible. This factor alone has probably led thousands of commercial borrowers to obtain operating cash from their personal credit cards when there were better alternatives.
Due to the growing tendency of several major credit card issuers to exhibit predatory lending practices, the use of personal credit card loans should be avoided. At a minimum, each business owner should contact a business finance funding expert to determine if a business cash advance program or a working capital loan program can be used to obtain needed cash.
By Credit Info
July 24th, 2009 at 02:21am
Under Small Business
Working capital for small businesses is a vital element in keeping the everyday operations of the business running smoothly from set up of the new company to maintenance and onwards. This form of ready funding is needed to conduct human resource tasks like hiring of able and competent staff that would support you in your goal of making a success out of the business, inventory purchases, buy needed raw materials, and produce sellable products to be marketed and eventually end up as financial gain. In a more technical tone, working capital for businesses may be defined as the operating liquidity that you end up with after the present liabilities are taken from the current assets of the business.
Working capital for small businesses must be available to ensure the longevity of the enterprise, feeding life into its cyclical operations. Not being able to retain ample amount to be used as working capital will cause the business liabilities to weight more than the assets. From there, things may go downhill with other financial issues materializing and in serious cases bankruptcy may be faced.
With the rise in number of small business operators or owners in urgent need of this kind of service, came the mushrooming of lending companies offering various ways to make working capital for small businesses available. Typically these forms of readily available funds have not been outlined for the acquisition of fixed assets of investing but mainly for advertising, accounts payable and for staff salaries. And the increasing accessibility of working capital sources not only with regards of physical location where you are to find an office near you but also regardless of where you are via the Internet, applying for such would not be to mush of a hassle.
Not having access to enough supply of working capital for small businesses is a great hindrance in the journey of business to growth and success. Without it, any enterprise would not reach its full potential, missing out on the chance or opportunity of expansion within the market and reaching a wider range and variety of consumers. Availing of the funds however would bring great benefit to the business through the support that it affords in shaping up profitable strategic plans to gain more profits, continuing an ongoing venture, reviving ones that are at risk, or exiting from failed ventures.
The acquisition of working capital for small businesses has been designed to be easy and fast. In the application process, credit score and financial history check can be avoided. There is even no risk posed on any of your properties as no collateral is necessary. And as fast as, or even faster than you are able to fill in the details and meet a few conditions, is the response to your fund request.
By Credit Info
July 21st, 2009 at 11:50am
Under Commercial Loan
Learn how to avoid problems with
working capital loans and obtain candid business cash advance advice – Stephen Bush is a small business cash management expert =>
AEX Commercial Loans and Commercial Mortgage Loans
By Credit Info
July 20th, 2009 at 11:55am
Under Commercial Loan
Learn how to avoid mistakes with commercial loans and find out about
small business cash management strategies – Steve Bush is a commercial mortgage loans expert => AEX Business Cash Advances and
Working Capital Financing
By Credit Info
July 20th, 2009 at 05:50am
Under Credit Line
Unsecured Lines of Credit are available for individuals that own businesses and have credit scores of 680 and above. Business owners who have been in business for more than two years are eligible for lines of credit up to $1 million with full documentation of personal and business taxes and financials. Applications without additional documentation (No Doc Applications) can also be approved for as much as $350,000. These lines of credit essentially function like Home Equity Lines of Credit because interest is paid only on the outstanding balance.
Unsecured Lines of Credit can be obtained in roughly 4 to 6 weeks but should never be applied for directly by the borrowers themselves. Being qualified does not mean that these borrowers are capable of simply walking into a bank or other lending institution and being approved. Companies that specialize in unsecured lines of credit are available and should be contacted to assist with the substantial preparation that is necessary. Professional business finance consulting firms maintain contacts and affiliations with lending institutions that offer unsecured lines of credit. It is extremely important that the business owner work with one of these firms instead of approaching the bank directly. The application process is somewhat complicated and documentation must be properly formatted and compiled to avoid unnecessary rejections.
Business owners can no longer rely on the equity in their real estate holdings to finance their business expansions and growth. Despite the fact that they paid high fees for the availability of home equity lines of credit, even business owners with excellent credit scores and excess equity in their properties are finding it impossible to access their credit lines. The main reason is that banks have virtually stopped providing homeowners access to the equity in their properties as lines of credit. Home Equity Lines of Credit have been frozen by most major lenders because declining property values have made these cutbacks necessary. IndyMac, Washington Mutual and other major mortgage lenders have made decisions to rescind these credit lines, according to the terms of their contracts with borrowers.
These recent eliminations of access to funds for their businesses have hit business owners especially hard. Many of them have used home equity lines for working capital during slow periods or as sources for cash during periods of expansion. The net result is that expected funds for business uses are not available, although they are still very necessary. The lack of time to make other arrangements because of this sudden policy change can severely impact a business owner’s ability to survive a shortage of funds. Many business owners routinely paid back their lines of credit so that those funds are available for them to use at some pre-determined time in the future. That option is no longer available, leaving them without their usual funds.
In summary, Unsecured Business Lines of Credit are methods of financing that are still available to qualified borrowers who are also business owners. Firms that specialize in acquiring unsecured lines of credit should always be involved in this application process. The applicant will need assistance in properly preparing and organizing his documentation for submission to lenders. By adhering to the current credit, submission and underwriting guidelines of each individual bank, a firm that specializes in this type of financing will be able to present the borrower as the “perfect applicant”. This very important initial step in the process will greatly enhance the business owner’s potential to be successfully approved for an unsecured line of credit.
Milton Franklin is a Founder and Managing Partner of Nationwide Equipment Leasing LLC. His company offers Unsecured Lines of Credit and other unique financial solutions to business owners. He can be reached at 800-395-4908. His free Special Report, “The Solution: Unsecured Line of Credit”, can be downloaded from his website by selecting Unsecured Line of Credit Information at
http://www.neleasing.com/application.form.cfm
By Credit Info
July 19th, 2009 at 05:51am
Under Commercial Loan
It was truly a good news mixed with bad news situation when reviewing business finance developments that occurred during 2007. Many of the commercial loan trends that emerged last year have significant implications for commercial borrowers seeking either new financing or refinancing in the coming months.
For business cash advance and credit card processing services, the past 12 months have been characterized by significant changes. There were many providers both entering and exiting these business activities. The fact that many poor providers have been forced to stop their role in these complex working capital services is positive news for business owners. But the bad news is that there are still many new and inexperienced companies attempting to operate in this complex field.
A similar trend involving inexperience can be seen in viewing the large number of residential financing brokers now attempting to transition into business financing. Since by some estimates approximately 100,000 residential financing employees lost their jobs during 2007, there is a real possibility that thousands of unqualified brokers will be entering the business finance field during 2008 or have already started the process.
During 2007 there was also noticeable attrition in SBA loan providers. This is primarily a positive development, since the field has long been overpopulated with inadequate business lenders.
During the past 12 months a large number of regional and local banks eliminated or reduced their business financing services. Perhaps the most negative aspect of this development is that most borrowers received very little advance notice from their previous lenders and therefore had to scramble to arrange new financing. If there is a positive aspect to this development it is probably that many borrowers confronted with the need to suddenly find alternative commercial financing sources have often ended up with much better terms by dealing with a new lender that specializes in commercial real estate financing and working capital management.
A general business loan trend impacting refinancing is the reduction in loan-to-value ratios, especially when borrowers are attempting to get some of their equity out of the business in cash. Increased down payments are increasingly necessary to purchase special purpose properties such as churches and funeral homes.
Although the general decrease in interest rates during the past year is a positive development, there will probably be some confusion among commercial borrowers who have adjustable rate terms when they do not see their rates reduced. In all likelihood, this will be due to a common clause applied to most commercial loan contracts that stipulate that the minimum rate for such agreements will never be less than the initial rate. With such a floor rate provision, this means that if a borrower starts with an adjustable rate set at 10% and then rates fall, the effective loan rate will remain at the initial rate.
A major commercial property investment trend has been some increasing activity due to the current decline in viable residential investing options. Due to many investors who would rather avoid property ownership, the lack of real estate in business opportunity investing is an attractive aspect.
By Credit Info
July 13th, 2009 at 05:54am
Under Commercial Loan
Learn how to avoid
commercial loan mistakes and find out about small business cash management strategies – Steve Bush is a
commercial mortgage loans expert => AEX Business Cash Advances and Working Capital Financing
By Credit Info
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