by: Lara Sawyer
The funds do not come only from government agencies. On the contrary, the most significant amounts come from private foundations and other non-profit institutions that want to contribute to fighting breast cancer. Eligibility for either government grants or private funding differs from grant to grant but almost any health care agency that is performing tasks related to breast cancer screening, diagnosing or treating will find a source of funds in the form of a grant if needed.
The Purpose Of These Grants
Why do private institutions and the federal government provide funding for these projects? Simple: The idea is to assign the money needed to research on this topic and support different developments that concentrate on breast cancer. The projects can focus on treatments or education or any other area provided that it is breast cancer related.
The mission is to offer to women who are medically underserved all that is needed in terms of information to avoid breast cancer whenever possible and to treat it or eliminate it if feasible. This includes education, screening, detection, treatment, medicines, hiring staff, etc. There are many costs that are related to the subject that need to be covered and these grants are meant for that.
The Amounts at Stake
All these costs are quite high and therefore much money is needed to cover for them. But contrary to common belief, these grants provide increasingly higher funds that are already significant. For instance, the higher grant amount provided by a private institution not so long ago reached almost the figure of 5,000,000 dollars and was awarded to a single institution fighting breast cancer.
What Have The Funds Been Awarded For
So far breast cancer grants from private institutions have been awarded for educational programs to reach the community and let the same community refer other community members so the information can be spread as thoroughly as possible. They have also been awarded for providing support to cancer patients, not only physically but also psychologically.
When it comes to financial assistance, these grants have been awarded not only to provide medical assistance but also for counseling, child care for those mothers that cannot take care of their children due to the illness, transportation to and from the clinic where all the procedures are performed and many other types of financial assistance that a victim of breast cancer may need.
Also, many grants where awarded not only by private institutions but also by the government for seminars on breast cancer, research and many other scientific topics that also need to be funded in order to develop new ways to address this problem that affects hundreds of thousands women across the country and world.
Thursday, January 14, 2010
The Benefits of the 15 Year Loan
by: Ki Gray
For one, you pay the loan off in half the amount of time you would with a 30 year loan. So if someone is currently 30 years old, they would pay off the loan when they are 45 instead of 60. Because it takes half the time, people frequently think that the payment on a 15 year loan is twice as much as on a 30 year loan, but this is far from the case. For instance, if we look at Compass Bank today a 30 year $160,000 loan will have a monthly payment of $1037.75. On the other hand, a 15 year loan is $1382.80 a month.
This shorter loan life translates to paying significantly less interest over the life of the loan. To figure out the interest, we take the total payments per year over the life of the loan and subtract the original amount of the loan which is 160k. So for the 30 year loan we use the formula ($1037.75 * 12 * 30yr) - $160,000 = $213,590. So you are pay a total of $213,590 in interest over the 30 years. On the other hand, for a 15 year loan using the same formula ($1382.80 * 12 * 15yr) - $160,000 = $88,904, you end up paying only $88,904 in interest, which is a 59% savings.
The details of why you pay less overall interest but somehow don't have a huge increase in monthly payments get a little involved. Since the $160,000 is amortized over 15 years, more of your monthly payment goes towards the principle amount of the loan than in a 30 year, so your next month's interest is calculated off of a smaller loan amount. For example, after 3 years, your principle balance is $154,351 on a 30 year and $138,279 for the 15 year. Since your balance is being paid down each month, your total interest is significantly less, so when you spread it out over 15 years, it will not double the 30 year monthly payment. Another factor in paying less each month is that most lenders will give you a better interest rate for a 15 year loan over a 30 year loan. In our examples, the Compass interest rates were 6.375% for a 15 year and 6.75% for a 30 year.
Are there any downsides to a 15 year loan? The biggest is probably inflation. If we went through a period of rapid inflation then for the last 15 years of the loan the payments would effectively be less because of inflation.
I am not saying everyone should get a 15 year loan. Frequently, people cannot spare the extra money per month and need to put that money into getting a larger house because of children or other needs. And I would never expect a 15 year loan to be the most prevalent mortgage used. But before picking a mortgage, it's probably a wise move to consider the 15 year mortgage and weight out its advantages.
For one, you pay the loan off in half the amount of time you would with a 30 year loan. So if someone is currently 30 years old, they would pay off the loan when they are 45 instead of 60. Because it takes half the time, people frequently think that the payment on a 15 year loan is twice as much as on a 30 year loan, but this is far from the case. For instance, if we look at Compass Bank today a 30 year $160,000 loan will have a monthly payment of $1037.75. On the other hand, a 15 year loan is $1382.80 a month.
This shorter loan life translates to paying significantly less interest over the life of the loan. To figure out the interest, we take the total payments per year over the life of the loan and subtract the original amount of the loan which is 160k. So for the 30 year loan we use the formula ($1037.75 * 12 * 30yr) - $160,000 = $213,590. So you are pay a total of $213,590 in interest over the 30 years. On the other hand, for a 15 year loan using the same formula ($1382.80 * 12 * 15yr) - $160,000 = $88,904, you end up paying only $88,904 in interest, which is a 59% savings.
The details of why you pay less overall interest but somehow don't have a huge increase in monthly payments get a little involved. Since the $160,000 is amortized over 15 years, more of your monthly payment goes towards the principle amount of the loan than in a 30 year, so your next month's interest is calculated off of a smaller loan amount. For example, after 3 years, your principle balance is $154,351 on a 30 year and $138,279 for the 15 year. Since your balance is being paid down each month, your total interest is significantly less, so when you spread it out over 15 years, it will not double the 30 year monthly payment. Another factor in paying less each month is that most lenders will give you a better interest rate for a 15 year loan over a 30 year loan. In our examples, the Compass interest rates were 6.375% for a 15 year and 6.75% for a 30 year.
Are there any downsides to a 15 year loan? The biggest is probably inflation. If we went through a period of rapid inflation then for the last 15 years of the loan the payments would effectively be less because of inflation.
I am not saying everyone should get a 15 year loan. Frequently, people cannot spare the extra money per month and need to put that money into getting a larger house because of children or other needs. And I would never expect a 15 year loan to be the most prevalent mortgage used. But before picking a mortgage, it's probably a wise move to consider the 15 year mortgage and weight out its advantages.
Invoice Factoring for Subcontractors
by: Gregg Elberg
The term 'subcontractor' means any person, partnership, or corporation engaged in building construction and who, pursuant to a subcontractor agreement, customarily furnishes labor, materials or services, for a building or structure's construction to a general contractor. The list of subcontractor categories includes: carpentry, communications, concrete, doors, drywall, electrical, environmental services, excavating, flooring, fire protection, glass, HVAC, insulation, masonry, mechanical, painting, plumbing, roofing, waterproofing and demolition.
General contractors bid on jobs to make a profit. They hire subcontractors generally with competitive bidding to make the most profit possible. This puts the subcontractor in a challenging environment. The greater the competition, all other things being equal, their bid price will determine whether or not they win the contract. This squeezes profit margins of subcontractors. Once the job begins, the subcontractor must pay for materials and labor for a considerable period of time, 30 to 60 days or more before payment is tendered for their work.
When a subcontractor factors their invoices they are selling their right to be paid from the general contractor to a commercial finance company. Factoring invoices accelerates cash flow to pay for labor and materials without waiting for the general contractor to be paid. Approximately 75% of the subcontractor's invoice will be advanced, less any retentions or setoffs. When the general contactor eventually pays the invoice the funds will go the commercial finance company. They will deduct their fees and rebate the difference to the subcontractor.
Invoice factoring for subcontractors makes economic sense when they are able to factor invoices profitably as a part of their cost of doing business. For instance, the owner of a rock quarry bid jobs to provide granite rock to highway construction general contractors with the estimated cost of financing always built into the bid. This allowed his company to grow profitably. In comparison, a painting contractor competing with many other bidders might have a gross profit margin that will not support the extra expense of the financing. Subcontractors must “do the math” before they consider entering into an accounts receivable financing contract.
Invoice factoring, which is also commonly called accounts receivable financing, is more complicated for subcontractors than factoring invoices in the manufacturing or staffing industries. First, the general contractor must agree to cooperate with the commercial finance company. And the terms of the general contractor's contract with the owner, especially public entities, might not allow the invoice factoring to occur. Every invoice to be funded must be verified by the general contractor in writing. There are also issues with mechanics lien laws. This requires subcontractors to pay their major suppliers from the advance or to obtain lien releases as a condition precedent for the advance from the commercial finance company.
Discounts from suppliers can help to offset the costs of financing. The cost of financing is the critical issue to be determined and negotiated. When a subcontractor signs an agreement to factor invoices, there is a blanket UCC-1 lien on all of their invoices. And all of their invoices and cash flow will go the commercial finance company whether or not the invoice has been “sold”. Therefore it is critical to understand and agree that the terms of the contract are reasonable and acceptable; this involves analysis of all contractual provisions besides the nominal price of the financing.
In this author's article, Financial Myths vs. Financial Facts there is an extensive discussion of the myriad ways that price may be determined. It pays to read the contract provisions carefully; the nominal price is only one consideration. How fees are determined, the term of the contract, early termination fees, what is the rate charged if there is a default or a dispute- these are just a few of the items to consider. Choice of law is another important consideration. Is the proposed contract pursuant to the law of the state you are doing business in or is it pursuant to the law of a state many thousands of miles away from your headquarters?
The bottom line: Invoice factoring for subcontractors makes sense when the cost of factoring invoices makes the entrepreneur more profitable. Reading the fine print of the contract is essential to this decision.
The term 'subcontractor' means any person, partnership, or corporation engaged in building construction and who, pursuant to a subcontractor agreement, customarily furnishes labor, materials or services, for a building or structure's construction to a general contractor. The list of subcontractor categories includes: carpentry, communications, concrete, doors, drywall, electrical, environmental services, excavating, flooring, fire protection, glass, HVAC, insulation, masonry, mechanical, painting, plumbing, roofing, waterproofing and demolition.
General contractors bid on jobs to make a profit. They hire subcontractors generally with competitive bidding to make the most profit possible. This puts the subcontractor in a challenging environment. The greater the competition, all other things being equal, their bid price will determine whether or not they win the contract. This squeezes profit margins of subcontractors. Once the job begins, the subcontractor must pay for materials and labor for a considerable period of time, 30 to 60 days or more before payment is tendered for their work.
When a subcontractor factors their invoices they are selling their right to be paid from the general contractor to a commercial finance company. Factoring invoices accelerates cash flow to pay for labor and materials without waiting for the general contractor to be paid. Approximately 75% of the subcontractor's invoice will be advanced, less any retentions or setoffs. When the general contactor eventually pays the invoice the funds will go the commercial finance company. They will deduct their fees and rebate the difference to the subcontractor.
Invoice factoring for subcontractors makes economic sense when they are able to factor invoices profitably as a part of their cost of doing business. For instance, the owner of a rock quarry bid jobs to provide granite rock to highway construction general contractors with the estimated cost of financing always built into the bid. This allowed his company to grow profitably. In comparison, a painting contractor competing with many other bidders might have a gross profit margin that will not support the extra expense of the financing. Subcontractors must “do the math” before they consider entering into an accounts receivable financing contract.
Invoice factoring, which is also commonly called accounts receivable financing, is more complicated for subcontractors than factoring invoices in the manufacturing or staffing industries. First, the general contractor must agree to cooperate with the commercial finance company. And the terms of the general contractor's contract with the owner, especially public entities, might not allow the invoice factoring to occur. Every invoice to be funded must be verified by the general contractor in writing. There are also issues with mechanics lien laws. This requires subcontractors to pay their major suppliers from the advance or to obtain lien releases as a condition precedent for the advance from the commercial finance company.
Discounts from suppliers can help to offset the costs of financing. The cost of financing is the critical issue to be determined and negotiated. When a subcontractor signs an agreement to factor invoices, there is a blanket UCC-1 lien on all of their invoices. And all of their invoices and cash flow will go the commercial finance company whether or not the invoice has been “sold”. Therefore it is critical to understand and agree that the terms of the contract are reasonable and acceptable; this involves analysis of all contractual provisions besides the nominal price of the financing.
In this author's article, Financial Myths vs. Financial Facts there is an extensive discussion of the myriad ways that price may be determined. It pays to read the contract provisions carefully; the nominal price is only one consideration. How fees are determined, the term of the contract, early termination fees, what is the rate charged if there is a default or a dispute- these are just a few of the items to consider. Choice of law is another important consideration. Is the proposed contract pursuant to the law of the state you are doing business in or is it pursuant to the law of a state many thousands of miles away from your headquarters?
The bottom line: Invoice factoring for subcontractors makes sense when the cost of factoring invoices makes the entrepreneur more profitable. Reading the fine print of the contract is essential to this decision.
Tuesday, January 12, 2010
Some Situations Where You Can Opt for a Fast Payday Loan
by: Apurva Shree
Payday loans or cash till payday loans are loans that lend you a small sum ranging from $100 to $1000 for a short period of time. These loans are also referred to as instant approval payday loans. This is because they do not require you to be a part of serpentine queues of people seeking loans. Since the amount borrowed as a cash advance loan is small, the processing time is also very short. In most cases you can have the money electronically transferred to your account within 24 hours of applying. You do not have to wait for the check to arrive in mail.
The Pitfalls
Although the idea of taking a fast payday loan sounds very lucrative, it has its own share of pitfalls. The most important aspect of a cash advance loan is that it comes with a very high APR (Annual Percentage Rate). Sometimes, the APR runs as high as 400%. It means that for every $100 you borrow, you will have to pay about $15 to $30 extra. Therefore, it is wise to borrow only an amount you need and pay it back on time.
Save Yourself
The most evident way of saving yourself from the pitfalls of a fast payday loan is by being regular in your repayment. However, a little time spent on educating yourself about the payday loans can help you save a lot of money. You just need to surf the net and find out all you can about the cash advance loans in offer. Compare APRs, fees, and terms offered by different lending institutions. The fast payday loans industry is one of the fastest growing lending industries in the U.S. Therefore, the competition between lenders is bound to be fierce. You can take advantage of this competition and negotiate for the most reasonable rate of interest.
The payday loans are Godsend for those who are in a deep pit of financial crisis. What further recommends these loans is that they are easy to get and are instantly approved. Proper research can also help you find a cheap payday loan. However, you must be careful while availing such loans as these have high APRs. You must borrow only what you need. For larger sums of money, you can look at other loan options available in the market.
Payday loans or cash till payday loans are loans that lend you a small sum ranging from $100 to $1000 for a short period of time. These loans are also referred to as instant approval payday loans. This is because they do not require you to be a part of serpentine queues of people seeking loans. Since the amount borrowed as a cash advance loan is small, the processing time is also very short. In most cases you can have the money electronically transferred to your account within 24 hours of applying. You do not have to wait for the check to arrive in mail.
The Pitfalls
Although the idea of taking a fast payday loan sounds very lucrative, it has its own share of pitfalls. The most important aspect of a cash advance loan is that it comes with a very high APR (Annual Percentage Rate). Sometimes, the APR runs as high as 400%. It means that for every $100 you borrow, you will have to pay about $15 to $30 extra. Therefore, it is wise to borrow only an amount you need and pay it back on time.
Save Yourself
The most evident way of saving yourself from the pitfalls of a fast payday loan is by being regular in your repayment. However, a little time spent on educating yourself about the payday loans can help you save a lot of money. You just need to surf the net and find out all you can about the cash advance loans in offer. Compare APRs, fees, and terms offered by different lending institutions. The fast payday loans industry is one of the fastest growing lending industries in the U.S. Therefore, the competition between lenders is bound to be fierce. You can take advantage of this competition and negotiate for the most reasonable rate of interest.
The payday loans are Godsend for those who are in a deep pit of financial crisis. What further recommends these loans is that they are easy to get and are instantly approved. Proper research can also help you find a cheap payday loan. However, you must be careful while availing such loans as these have high APRs. You must borrow only what you need. For larger sums of money, you can look at other loan options available in the market.
Should You Consider Payday Loans for Your Short Term Money Needs
by: Gregg Hall
The person can get the loan by showing identification and paycheck stubs to the company giving them the loan. Do remember though that if you are trying to get ahead financially this is not the way to do it. While you get money quick, the interest charged on these loans is high and it is definitely not the way to get a head. Getting one of these loans, in the end would actually put you further behind.
You might wonder who gives these loans since banks give out other loans and they are bound by how much interest that they can charge. Check cashers, finance companies, and other firms usually give these loans. These types of loans became quite well known quickly because of their advertisements on television, radio, the Internet, even email. These ads contain information about the loans as well benefits of the loans. They of course, do not contain warnings about the dangers of the loans themselves. These ads made the loans very popular throughout the world with more and more customers considering applying for them all of the time.
In order to apply for the loan you must have a bank account, identification, and a paycheck stub. You write a check for the amount of the loan that you want as well as the fee that you will be charged. Usually, the check is held until your next payday which is when the company collects the repayment of the loan as well as their fee. The fee is usually quite high in comparison to the amount of the loan. The loans are usually not a large sum of money, often $500 or less.
There are some options as a short term payday loan customer that you may not know about that we have not discussed as yet. One option is, of course, to allow the check to process as it would normally, as discussed above. Another option would be to go in person and pay off the loans in person prior to the cashing of the check that they have on hand. Yet a third option would be to extend the loan that you have. This can be done two times and of course, with additional fees applied. These fees are very costly, so of course, this option is not recommended.
It is said that there are instances where lenders may charge $15 to $50 per every $90 borrowed when giving out these loans. This is every time they give out one of these loans. So, if you were to extend your loan period you would pay this entire fee again, possibly twice if you did it for the two times allowed. In this case you would use the entire amount that you borrowed just to pay the fees. This hardly would make borrowing the money worth it.
The person can get the loan by showing identification and paycheck stubs to the company giving them the loan. Do remember though that if you are trying to get ahead financially this is not the way to do it. While you get money quick, the interest charged on these loans is high and it is definitely not the way to get a head. Getting one of these loans, in the end would actually put you further behind.
You might wonder who gives these loans since banks give out other loans and they are bound by how much interest that they can charge. Check cashers, finance companies, and other firms usually give these loans. These types of loans became quite well known quickly because of their advertisements on television, radio, the Internet, even email. These ads contain information about the loans as well benefits of the loans. They of course, do not contain warnings about the dangers of the loans themselves. These ads made the loans very popular throughout the world with more and more customers considering applying for them all of the time.
In order to apply for the loan you must have a bank account, identification, and a paycheck stub. You write a check for the amount of the loan that you want as well as the fee that you will be charged. Usually, the check is held until your next payday which is when the company collects the repayment of the loan as well as their fee. The fee is usually quite high in comparison to the amount of the loan. The loans are usually not a large sum of money, often $500 or less.
There are some options as a short term payday loan customer that you may not know about that we have not discussed as yet. One option is, of course, to allow the check to process as it would normally, as discussed above. Another option would be to go in person and pay off the loans in person prior to the cashing of the check that they have on hand. Yet a third option would be to extend the loan that you have. This can be done two times and of course, with additional fees applied. These fees are very costly, so of course, this option is not recommended.
It is said that there are instances where lenders may charge $15 to $50 per every $90 borrowed when giving out these loans. This is every time they give out one of these loans. So, if you were to extend your loan period you would pay this entire fee again, possibly twice if you did it for the two times allowed. In this case you would use the entire amount that you borrowed just to pay the fees. This hardly would make borrowing the money worth it.
Some of the Ways that Payday Loans Can Really Make You Pay
by: Gregg Hall
Due to the popularity of this type of loan a large number of companies offering them have come into existence. They have popped up in little strip malls across the country and emerged on the Internet. They are almost everywhere you look. These places will lend you money based on the fact that you have another paycheck coming.
Of course, you have to have proof that you have another paycheck coming, but then again, that isn't so difficult to prove. You just need to show them previous pay stubs to prove that you are employed, personal identification to prove who you are, bank information. The fee and the amount borrowed is then usually just automatically deducted from your account.
The most often quoted reason for needing to borrow money in this fashion is an unexpected bill, a car breaking down, an appliance breaking down in the home, or some other emergency such as this. Unfortunately, this is not a very economical way to pay such a bill. The interest is very high, much higher than the typical bank loan, even higher than a credit card. It may be wise then, to apply whatever the repair needed to your credit card if speed is of the essence and then go to the bank to see if a bank loan is then possible to try and avoid over paying in interest. But if for any reason you cannot steer away from type of loan and the repair or new appliance is indeed an emergency the quick payday loan is an option that you can consider. It is just important that you do not make a habit of this type of loan or that you do not use this type of loan to pay regular bills as it is very expensive and can only lead to more debt.
Another important consideration is that the term "quick" implies faster than a bank loan but may not mean in a matter of minutes necessarily. For instance, if you are applying for one of these loans online, the necessary documents will still be needed this will then take about twenty-four hours to process. If you go to the location personally, however, you can anticipate having the funds in your hand within a half of a day. So depending on where you apply for the loan makes quite a difference in the speed at which you will get the funds.
Due to the popularity of this type of loan a large number of companies offering them have come into existence. They have popped up in little strip malls across the country and emerged on the Internet. They are almost everywhere you look. These places will lend you money based on the fact that you have another paycheck coming.
Of course, you have to have proof that you have another paycheck coming, but then again, that isn't so difficult to prove. You just need to show them previous pay stubs to prove that you are employed, personal identification to prove who you are, bank information. The fee and the amount borrowed is then usually just automatically deducted from your account.
The most often quoted reason for needing to borrow money in this fashion is an unexpected bill, a car breaking down, an appliance breaking down in the home, or some other emergency such as this. Unfortunately, this is not a very economical way to pay such a bill. The interest is very high, much higher than the typical bank loan, even higher than a credit card. It may be wise then, to apply whatever the repair needed to your credit card if speed is of the essence and then go to the bank to see if a bank loan is then possible to try and avoid over paying in interest. But if for any reason you cannot steer away from type of loan and the repair or new appliance is indeed an emergency the quick payday loan is an option that you can consider. It is just important that you do not make a habit of this type of loan or that you do not use this type of loan to pay regular bills as it is very expensive and can only lead to more debt.
Another important consideration is that the term "quick" implies faster than a bank loan but may not mean in a matter of minutes necessarily. For instance, if you are applying for one of these loans online, the necessary documents will still be needed this will then take about twenty-four hours to process. If you go to the location personally, however, you can anticipate having the funds in your hand within a half of a day. So depending on where you apply for the loan makes quite a difference in the speed at which you will get the funds.
Sunday, January 10, 2010
Payday Cash Loans What You Need to Know About Cash Advance Payday Loans
by: Helen Hecker
Using the Internet has big advantages because it's so fast and easy to apply online, without the need to travel across town to a payday loan company; and often you can easily get a one hour loan. You can get a no bank statement loan almost within an instant and using what is called a faxless payday loan. Once you're approved for a payday cash advance, they'll electronically deposit the money directly into your checking account. You can even get payday loans with no checking account from some lenders. These loans may be right for you if you need a little money for a short period of time.
The reason why these loans are so popular is that they allow you to get your money quickly and with minimum fuss. The payday cash loan companies help thousands of people every day with their short term money problems. Paperless payday loans are just as the name suggests; there is no paperwork involved in the application process.
Payday cash loans or cash advances are lifesavers for short-term, small cash problems. With cash advance payday loans, there is no credit check. The average borrower is employed and who uses the paycheck to take care of emergency needs.
Emergency payday cash loans or cash advances help you pay your mortgage, auto loan, or any number of other bills that you just can't handle because of an unseen expense or two. The new online payday loans work just like the traditional payday advance loan. Most of them can offer a short-term instant loan to anyone over 18 years of age who has an active bank account and steady job.
To process payday loans quickly and conveniently, clients must provide a few personal details, their online contact email address and bank and employment information. Returning customers can receive even higher loans in the future. They are available nationwide and you can get the money directly deposited into your bank account very quickly.
Payday cash loans are the fastest way to obtain an electronic deposit to your checking or savings account, so you can avoid costly bounced check or late payment penalties. They work like this: you fill out an application and provide the lender with items such as paycheck stubs and a photo ID. With a 100% online pay day loan approval process there is no need to leave your computer to get a cash advance because your request is generally instantly processed on a secure server and your personal payday advance is wire transferred to you quickly.
You should be aware that the interest rate on a payday loan may be 500% per year or more; so make sure that you'll be able to pay it back to avoid any further cost. You can check around for low fee payday loans also because it's a very competitive market. Most loan companies online, who provide next day cash advances and faxless loans, do so with no credit check. Hard to believe but you can apply over the Internet for a loan and get approval in as little as 30 seconds sometimes.
Whether you have bad credit, slow credit or no credit there are cash advances available to you. Payday loans are lifesavers for short-term, small cash problems: a good solution for anyone who needs a fast, easy and confidential way of getting emergency cash.
Using the Internet has big advantages because it's so fast and easy to apply online, without the need to travel across town to a payday loan company; and often you can easily get a one hour loan. You can get a no bank statement loan almost within an instant and using what is called a faxless payday loan. Once you're approved for a payday cash advance, they'll electronically deposit the money directly into your checking account. You can even get payday loans with no checking account from some lenders. These loans may be right for you if you need a little money for a short period of time.
The reason why these loans are so popular is that they allow you to get your money quickly and with minimum fuss. The payday cash loan companies help thousands of people every day with their short term money problems. Paperless payday loans are just as the name suggests; there is no paperwork involved in the application process.
Payday cash loans or cash advances are lifesavers for short-term, small cash problems. With cash advance payday loans, there is no credit check. The average borrower is employed and who uses the paycheck to take care of emergency needs.
Emergency payday cash loans or cash advances help you pay your mortgage, auto loan, or any number of other bills that you just can't handle because of an unseen expense or two. The new online payday loans work just like the traditional payday advance loan. Most of them can offer a short-term instant loan to anyone over 18 years of age who has an active bank account and steady job.
To process payday loans quickly and conveniently, clients must provide a few personal details, their online contact email address and bank and employment information. Returning customers can receive even higher loans in the future. They are available nationwide and you can get the money directly deposited into your bank account very quickly.
Payday cash loans are the fastest way to obtain an electronic deposit to your checking or savings account, so you can avoid costly bounced check or late payment penalties. They work like this: you fill out an application and provide the lender with items such as paycheck stubs and a photo ID. With a 100% online pay day loan approval process there is no need to leave your computer to get a cash advance because your request is generally instantly processed on a secure server and your personal payday advance is wire transferred to you quickly.
You should be aware that the interest rate on a payday loan may be 500% per year or more; so make sure that you'll be able to pay it back to avoid any further cost. You can check around for low fee payday loans also because it's a very competitive market. Most loan companies online, who provide next day cash advances and faxless loans, do so with no credit check. Hard to believe but you can apply over the Internet for a loan and get approval in as little as 30 seconds sometimes.
Whether you have bad credit, slow credit or no credit there are cash advances available to you. Payday loans are lifesavers for short-term, small cash problems: a good solution for anyone who needs a fast, easy and confidential way of getting emergency cash.
Bad Credit Car Loans are Booming
by: Sean Patrick
Divorce often leads to bankruptcy and will impact on a consumer's credit score long after they have recovered financially. Specialized lenders have recognized that a poor credit score may not reflect on a consumer ability to make payments and have placed less emphasis on credit history and more emphasis on ability to pay.
National and regional lenders have emerged to service the very competitive bad credit car loan market referred to as the "Special Finance" or "Sub-prime" market. These lenders have further divided the "Special Finance" market up into different levels of risks to such an extent that there are lender's who has specifically targeted the most credit challenged consumer with the highest risk. The good new is that no matter what your credit circumstances are, there is probably a lender out there for you.
Another phenomenon is the independent credit service that will process your request for credit and forward it to the lender that is most likely to approve the request. These services usually work with a car dealer who have access to both National and Regional lenders.
The Online Credit Application
The independent credit service has successfully introduced the online credit application to the market. The online credit application offers a no hassle approach to applying for credit. Anyone who has sat in front of a loans officer and had to explain their credit history will find the online credit application a blessing. If you decide to complete an online credit application make sure that it is secure. Look for a security certificate. Comodo and Verisign are two companies that offer security certificates that I am familiar with. You should also look for a privacy policy to guarantee that your personal information will not be shared or sold.
A car loan is a big ticket item that can help rebuild your credit score. Some lenders will offer programs that will reduce your rate or allow you to renegotiate after a specified length of time if you have not missed or been late on a payment.
There are many lenders who specialize in products and services for consumers that have troubled financial histories including bankruptcy. An independent service will provide an online credit application and will give you access to network of lenders. Simply enter "car loans" in search box of your favorite search engine. Most of these service offer tools like loan and budget calculators.
What You Can Do
The first step before shopping for a car loan is to evaluate your financial situation. By determining your income to debt ratio you can see what kind of monthly payment is feasible for you. You do not want to be overburdened by payments and find yourself in trouble again. Next you may want to check your credit rating and clean it up where possible. Your credit score is negatively affected by late payments, high debt to income ratio and past bankruptcy. Close any accounts that are not in use. Too many open accounts are a negative. Pay up any outstanding debts. If you have recently filed for bankruptcy and there are extenuating circumstances such as a lay off or divorce, consider writing a page of explanation to attach to your report.
Regardless of your past credit history there is almost always a lender who is willing to provide you with a car loan. The question is how much are you willing to pay for that loan? A few extra percentage points are worth the opportunity to rebuild your credit. But be sure that your financial house is in order before you apply so that you can qualify for the best rate and terms your current financial circumstance will allow.
Divorce often leads to bankruptcy and will impact on a consumer's credit score long after they have recovered financially. Specialized lenders have recognized that a poor credit score may not reflect on a consumer ability to make payments and have placed less emphasis on credit history and more emphasis on ability to pay.
National and regional lenders have emerged to service the very competitive bad credit car loan market referred to as the "Special Finance" or "Sub-prime" market. These lenders have further divided the "Special Finance" market up into different levels of risks to such an extent that there are lender's who has specifically targeted the most credit challenged consumer with the highest risk. The good new is that no matter what your credit circumstances are, there is probably a lender out there for you.
Another phenomenon is the independent credit service that will process your request for credit and forward it to the lender that is most likely to approve the request. These services usually work with a car dealer who have access to both National and Regional lenders.
The Online Credit Application
The independent credit service has successfully introduced the online credit application to the market. The online credit application offers a no hassle approach to applying for credit. Anyone who has sat in front of a loans officer and had to explain their credit history will find the online credit application a blessing. If you decide to complete an online credit application make sure that it is secure. Look for a security certificate. Comodo and Verisign are two companies that offer security certificates that I am familiar with. You should also look for a privacy policy to guarantee that your personal information will not be shared or sold.
A car loan is a big ticket item that can help rebuild your credit score. Some lenders will offer programs that will reduce your rate or allow you to renegotiate after a specified length of time if you have not missed or been late on a payment.
There are many lenders who specialize in products and services for consumers that have troubled financial histories including bankruptcy. An independent service will provide an online credit application and will give you access to network of lenders. Simply enter "car loans" in search box of your favorite search engine. Most of these service offer tools like loan and budget calculators.
What You Can Do
The first step before shopping for a car loan is to evaluate your financial situation. By determining your income to debt ratio you can see what kind of monthly payment is feasible for you. You do not want to be overburdened by payments and find yourself in trouble again. Next you may want to check your credit rating and clean it up where possible. Your credit score is negatively affected by late payments, high debt to income ratio and past bankruptcy. Close any accounts that are not in use. Too many open accounts are a negative. Pay up any outstanding debts. If you have recently filed for bankruptcy and there are extenuating circumstances such as a lay off or divorce, consider writing a page of explanation to attach to your report.
Regardless of your past credit history there is almost always a lender who is willing to provide you with a car loan. The question is how much are you willing to pay for that loan? A few extra percentage points are worth the opportunity to rebuild your credit. But be sure that your financial house is in order before you apply so that you can qualify for the best rate and terms your current financial circumstance will allow.
Find The Best Home Improvement Loan In Minutes
by: Amanda Hash
There are different loan products that you can obtain and can be destined to improving your property. Though there are home improvement loans specially tailored for that purpose, there are also alternative sources of income that can be used to and you should consider them all prior to applying for a particular loan product.
Different Loan Products
For starters, you can refinance your home loan for a higher loan amount than your current mortgage loan and thus obtain extra funds for undertaking home improvement projects. These loans are known as cash-out refinance home loans and can be obtained when you have sufficient equity left on your home. As long as your property's value is superior to the current mortgage balance, you can request a cash-out refinance home loan and use that difference for financing home improvements.
If you do not want to refinance you current home loan because it has good terms, you can still get finance from your home equity by requesting a home equity loan or line of credit. A home equity loan (second mortgage) is a loan that uses the equity (difference between your property's value and mortgage balance) to guarantee the amount of money borrowed and has similarly advantageous terms to home loans.
Home equity lines of credit work likewise but are a revolving source of funds from which you can obtain any amount you need up to certain limit. Also, you can repay the money borrowed the way you want with minimum payments that usually consist only of interests. You can always withdraw more money when you need it as long as you do not exceed the credit limit.
There are also unsecured loans that can be used for undertaking home improvement projects. These loans carry lower amounts than secured loan but there is no risk of repossession since no collateral is required. The interest rate charged is a bit higher and so are the monthly payments. Still, if the home improvement project does not require a high amount of money, they constitute the most simple choice since approval is fast and hassle free.
Online Lenders and Loan Comparison
The easiest way to obtain the loan you need is to search online for lenders after you have decided which loan type best suits your needs. You just need to make a quick search for cash-out refinance home loans, home equity loans or lines of credit or unsecured loans and many different lenders will be presented to you.
Do not go for the first offer you receive, instead, compare what the different lenders have to offer by requesting loan quotes from them and analyzing the loan terms. After you have made a comparison and decided which lender and loan offers you the best option, you will just need to fill the online application and wait to be contacted by the lender.
There are different loan products that you can obtain and can be destined to improving your property. Though there are home improvement loans specially tailored for that purpose, there are also alternative sources of income that can be used to and you should consider them all prior to applying for a particular loan product.
Different Loan Products
For starters, you can refinance your home loan for a higher loan amount than your current mortgage loan and thus obtain extra funds for undertaking home improvement projects. These loans are known as cash-out refinance home loans and can be obtained when you have sufficient equity left on your home. As long as your property's value is superior to the current mortgage balance, you can request a cash-out refinance home loan and use that difference for financing home improvements.
If you do not want to refinance you current home loan because it has good terms, you can still get finance from your home equity by requesting a home equity loan or line of credit. A home equity loan (second mortgage) is a loan that uses the equity (difference between your property's value and mortgage balance) to guarantee the amount of money borrowed and has similarly advantageous terms to home loans.
Home equity lines of credit work likewise but are a revolving source of funds from which you can obtain any amount you need up to certain limit. Also, you can repay the money borrowed the way you want with minimum payments that usually consist only of interests. You can always withdraw more money when you need it as long as you do not exceed the credit limit.
There are also unsecured loans that can be used for undertaking home improvement projects. These loans carry lower amounts than secured loan but there is no risk of repossession since no collateral is required. The interest rate charged is a bit higher and so are the monthly payments. Still, if the home improvement project does not require a high amount of money, they constitute the most simple choice since approval is fast and hassle free.
Online Lenders and Loan Comparison
The easiest way to obtain the loan you need is to search online for lenders after you have decided which loan type best suits your needs. You just need to make a quick search for cash-out refinance home loans, home equity loans or lines of credit or unsecured loans and many different lenders will be presented to you.
Do not go for the first offer you receive, instead, compare what the different lenders have to offer by requesting loan quotes from them and analyzing the loan terms. After you have made a comparison and decided which lender and loan offers you the best option, you will just need to fill the online application and wait to be contacted by the lender.
Saturday, January 9, 2010
Homeowner Get Higher Loan Amounts On Any Loan Type
by: Amanda Hash
Homeownership represents a significant risk reduction for the lender even if the assets are not used as collateral for the loan. Thus, anyone who is a homeowner will find in lenders a better disposition to negotiate loan terms and will be able to obtain more advantageous terms on loans including higher loan amounts without having to overpay for them.
Homeownership and Risk
Homeownership and risk are two concepts that are related. The risk implied in any financial transaction will depend on the applicant's creditworthiness and on other factors too. One on these factors is the applicant's ability to repay the loan which is determined by the income and all the applicant's assets that can be eventually sold to use the money to repay the loan.
Thus, being a homeowner greatly reduces the risk involved in any financial transaction, even if the property or properties are not used as collateral for that particular loan. This is due to the fact that regardless of the use of the properties, they are still unofficially guaranteeing repayment of any applicant's obligations because there are legal processes other than repossession that can force the borrower to sell the property to repay the loan in the event of default.
Risk And Loan Amount
We have analyzed the fact that homeownership and risk are related, now we will go a step forward to see how risk and loan amount are related. Actually the risk involved in the financial transaction determines most of the loan terms. The loan amount is definitely not the exception. If the risk is higher, the lender will prefer to lend the least money possible in order not to risk too much on the financial transaction.
Thus, a lower risk will imply that the lender will be willing to lend a higher loan amount as this will increase his profits without too much risk of default. Since the risk can be pondered in terms of money, the higher the loan amount lent, the higher the risk. But the opposite is also true: the lower the risk implied (due to other factors like homeownership) the higher the loan amount that can be lent.
Conclusion
From the above two considerations, one can infer that homeownership implies a lower risk in any financial transaction regardless of the use of the property as collateral of the loan or not and that this risk reduction affects the loan terms in a positive way. Thus, due to the risk reduction produced by homeownership, the applicant can get lower interest rates, longer repayment programs, lower monthly payments and higher loan amounts. This last consideration is the logical consequence of the whole analysis and explains the reasons of the article's title.
Homeownership represents a significant risk reduction for the lender even if the assets are not used as collateral for the loan. Thus, anyone who is a homeowner will find in lenders a better disposition to negotiate loan terms and will be able to obtain more advantageous terms on loans including higher loan amounts without having to overpay for them.
Homeownership and Risk
Homeownership and risk are two concepts that are related. The risk implied in any financial transaction will depend on the applicant's creditworthiness and on other factors too. One on these factors is the applicant's ability to repay the loan which is determined by the income and all the applicant's assets that can be eventually sold to use the money to repay the loan.
Thus, being a homeowner greatly reduces the risk involved in any financial transaction, even if the property or properties are not used as collateral for that particular loan. This is due to the fact that regardless of the use of the properties, they are still unofficially guaranteeing repayment of any applicant's obligations because there are legal processes other than repossession that can force the borrower to sell the property to repay the loan in the event of default.
Risk And Loan Amount
We have analyzed the fact that homeownership and risk are related, now we will go a step forward to see how risk and loan amount are related. Actually the risk involved in the financial transaction determines most of the loan terms. The loan amount is definitely not the exception. If the risk is higher, the lender will prefer to lend the least money possible in order not to risk too much on the financial transaction.
Thus, a lower risk will imply that the lender will be willing to lend a higher loan amount as this will increase his profits without too much risk of default. Since the risk can be pondered in terms of money, the higher the loan amount lent, the higher the risk. But the opposite is also true: the lower the risk implied (due to other factors like homeownership) the higher the loan amount that can be lent.
Conclusion
From the above two considerations, one can infer that homeownership implies a lower risk in any financial transaction regardless of the use of the property as collateral of the loan or not and that this risk reduction affects the loan terms in a positive way. Thus, due to the risk reduction produced by homeownership, the applicant can get lower interest rates, longer repayment programs, lower monthly payments and higher loan amounts. This last consideration is the logical consequence of the whole analysis and explains the reasons of the article's title.
Homeownership Can Boost Your Approval Rate
by: Amanda Hash
The reasons for this can be explained analyzing the effects that homeownership has on the loan terms and requirements for approval. There is a variable that is greatly modified by homeownership which has important incidences on all loan terms and requirements: the risk of default for the lender in the financial transaction.
Risk Of Default And Approval
The approval process is ruled by the lenders fear of default: The higher the risk of default, the lower the chances of getting approved. In the event of default, the lender is actually loosing his investment because there are little chances of recovering the money unless the lender has sufficient assets to compensate for the loses.
The risk of default and approval are thus, greatly related. If the applicant can provide any aid to reduce the risk of default, the lender will be significantly more comfortable at lending the money that the borrower needs. Thus, it is important to know which modifiers can reduce the risk of default and boost the chances of getting approved.
Consequences of Homeownership
Along these modifiers we can analyze various options: collateral, simple homeownership, down payments and a co-signer. Collateral provides the best form of guarantee as it is a particular asset that is used for security of a loan and the lender can take legal action of repossession in the event that the borrower defaults on the loan.
A down payment is useful for certain secured loans that already have collateral but the risk of default is still high. Then, the borrower offers a certain amount of money that has already been set aside by him, so as to reduce the amount of money needed to purchase the home or the car and thus, leaving the property with a higher amount of equity left. The property guaranteeing the loan is then worth more than the debt it is guaranteeing.
A co-signer is obliged to repay the loan along with the main applicant and thus provides an additional guarantee for repayment. This is also associated with homeownership. If both the applicant and the co-signer are homeowners, chances of getting approved are greater as the lender has additional properties to obtain repayment from in the event of default.
Finally, we have reached the modifier that can provide a great risk reduction without too many hassles. Simple homeownership provides a reduction on the risk involved in any financial transaction regardless if the property or properties are used as collateral for the loan. This is due to the fact that all of the applicant's assets guarantee in a way the repayment of the loan. All the assets legally guarantee any debt that the owner may have and that's the reason why a co-signer who is also a homeowner provides an additional guarantee and lowers the risk even more: He does not only provide an additional income but also, an additional real estate guarantee or guarantees.
The reasons for this can be explained analyzing the effects that homeownership has on the loan terms and requirements for approval. There is a variable that is greatly modified by homeownership which has important incidences on all loan terms and requirements: the risk of default for the lender in the financial transaction.
Risk Of Default And Approval
The approval process is ruled by the lenders fear of default: The higher the risk of default, the lower the chances of getting approved. In the event of default, the lender is actually loosing his investment because there are little chances of recovering the money unless the lender has sufficient assets to compensate for the loses.
The risk of default and approval are thus, greatly related. If the applicant can provide any aid to reduce the risk of default, the lender will be significantly more comfortable at lending the money that the borrower needs. Thus, it is important to know which modifiers can reduce the risk of default and boost the chances of getting approved.
Consequences of Homeownership
Along these modifiers we can analyze various options: collateral, simple homeownership, down payments and a co-signer. Collateral provides the best form of guarantee as it is a particular asset that is used for security of a loan and the lender can take legal action of repossession in the event that the borrower defaults on the loan.
A down payment is useful for certain secured loans that already have collateral but the risk of default is still high. Then, the borrower offers a certain amount of money that has already been set aside by him, so as to reduce the amount of money needed to purchase the home or the car and thus, leaving the property with a higher amount of equity left. The property guaranteeing the loan is then worth more than the debt it is guaranteeing.
A co-signer is obliged to repay the loan along with the main applicant and thus provides an additional guarantee for repayment. This is also associated with homeownership. If both the applicant and the co-signer are homeowners, chances of getting approved are greater as the lender has additional properties to obtain repayment from in the event of default.
Finally, we have reached the modifier that can provide a great risk reduction without too many hassles. Simple homeownership provides a reduction on the risk involved in any financial transaction regardless if the property or properties are used as collateral for the loan. This is due to the fact that all of the applicant's assets guarantee in a way the repayment of the loan. All the assets legally guarantee any debt that the owner may have and that's the reason why a co-signer who is also a homeowner provides an additional guarantee and lowers the risk even more: He does not only provide an additional income but also, an additional real estate guarantee or guarantees.
Veteran Subsidized Loans The Wartime And Peacetime Issue
by: Lara Sawyer
Why are these two concepts important? Because the time requirements for approval on veteran and military loans that are subsidized differ when the applicant has serviced during peacetime or during war. Peacetime periods of time require the applicant to show proof of longer terms on active duty. And in order to know in which category you fall, you need to understand which periods of time correspond to wartime and which ones correspond to peacetime. Following is a tentative timeline:
World War II (Wartime)
There is a wartime period that corresponds to the world war II starting on September 1940 and finishing on July 1947. There may be small variations of this time spectrum according to the different lenders though.
Post-World War II (Peacetime)
There is a peacetime period that comes after the end of world war II and extends from August, 1947 till June, 1950. As with the above wartime period, the term may change and you should contact the specific lenders in order to know the time spam that is actually considered for approval.
Korean Conflict (Wartime)
Following the post-world war II peacetime period, the Korean conflict was significant and long enough for lenders to consider it a wartime period too. This term starts on July 1950 and extends to February 1955.
Post Korean Conflict (Peacetime)
After the Korean conflict, a new peacetime period is registered and lasts till the Vietnam war. It begins on February 1955 and lasts till August 1964. It is important to note that there were minor conflicts during most peacetime periods and some lenders take those conflicts into account too.
Vietnam War (Wartime)
Vietnam war is of course a wartime period that reduces the time requirements for approval of Veteran Loans and other subsidized military loans. It starts on August 1964 and lasts till May 1975. However, for those who where stationed in Vietnam before the conflict, the period can start on February 1961.
Post-Vietnam (Peacetime)
After the Vietnam War a new peacetime period begins that includes the cold war and many minor conflicts. It starts on May 1975 and lasts till the Gulf War starts on August 1990. Bear in mind though, that the many minor conflicts that took place during this period can be considered wartime by some lenders too.
Gulf-War Period (Wartime)
The last period starts with the Gulf War on August 1990. Some consider it ended and a new period started on 2001 but in most cases the end of this particular period is undetermined. Therefore, there is no unique reference for Veterans or military personnel. You need to find out with the particular lenders whether the situation that triggers eligibility (disability, discharge, etc.) occurred during a wartime or peacetime period
Why are these two concepts important? Because the time requirements for approval on veteran and military loans that are subsidized differ when the applicant has serviced during peacetime or during war. Peacetime periods of time require the applicant to show proof of longer terms on active duty. And in order to know in which category you fall, you need to understand which periods of time correspond to wartime and which ones correspond to peacetime. Following is a tentative timeline:
World War II (Wartime)
There is a wartime period that corresponds to the world war II starting on September 1940 and finishing on July 1947. There may be small variations of this time spectrum according to the different lenders though.
Post-World War II (Peacetime)
There is a peacetime period that comes after the end of world war II and extends from August, 1947 till June, 1950. As with the above wartime period, the term may change and you should contact the specific lenders in order to know the time spam that is actually considered for approval.
Korean Conflict (Wartime)
Following the post-world war II peacetime period, the Korean conflict was significant and long enough for lenders to consider it a wartime period too. This term starts on July 1950 and extends to February 1955.
Post Korean Conflict (Peacetime)
After the Korean conflict, a new peacetime period is registered and lasts till the Vietnam war. It begins on February 1955 and lasts till August 1964. It is important to note that there were minor conflicts during most peacetime periods and some lenders take those conflicts into account too.
Vietnam War (Wartime)
Vietnam war is of course a wartime period that reduces the time requirements for approval of Veteran Loans and other subsidized military loans. It starts on August 1964 and lasts till May 1975. However, for those who where stationed in Vietnam before the conflict, the period can start on February 1961.
Post-Vietnam (Peacetime)
After the Vietnam War a new peacetime period begins that includes the cold war and many minor conflicts. It starts on May 1975 and lasts till the Gulf War starts on August 1990. Bear in mind though, that the many minor conflicts that took place during this period can be considered wartime by some lenders too.
Gulf-War Period (Wartime)
The last period starts with the Gulf War on August 1990. Some consider it ended and a new period started on 2001 but in most cases the end of this particular period is undetermined. Therefore, there is no unique reference for Veterans or military personnel. You need to find out with the particular lenders whether the situation that triggers eligibility (disability, discharge, etc.) occurred during a wartime or peacetime period
Thursday, January 7, 2010
Secured Business Loans: Commercial Mortgages
by: Amanda Hash
Secured business loans are becoming more and more common among businessmen as small companies begin to own their own commercial offices and headquarters instead of renting. Thus, they can take advantage of real estate by obtaining finance through secured loans. But, they can also use as security their future sells, thus obtaining finance with alternative forms of collateral.
Real Estate Based Business Loans And Lines of Credit
There are business loans that are secured with real estate properties just like regular mortgage loans and home equity loans. The sole difference is that these properties belong to a company instead of a particular person. Nevertheless the concept is just the same: the property's value guarantees repayment of the money to the lender and thus reduces the risk of the transaction letting the lender offer lower interest rates and more advantageous loan terms.
There are commercial mortgages (the equivalent to home mortgages), commercial second mortgages (the equivalent to home equity loans) and commercial lines of credit based on equity which are just like home equity lines of credit. Equity is the difference between the value of the property and the amount of money borrowed that the property is already guaranteeing.
However, commerce and companies have other property's that can be used as collateral for loans. Intellectual property, trade marks, etc. can also be used to guarantee a loan as they are usually of great value. A company has many possessions that can be used to guarantee a line of credit or a loan. You will just need to consult with credit experts at an agency or financial institution since detailed information on this matter exceeds the purpose of this article.
Loans And Lines Of Credit Based On Future Sells
Finally there are also loans and lines of credit that are based on the future sells of the company. These financial products work as follows: The financial institution processes credit card payments for the company that wants to borrow money and thus, knows exactly the average income of the company in terms of credit card payments. Thus, the financial institution will be able to lend money in the form of a loan or line of credit and agree loan installments or minimum payments that will be withdrawn directly from the amount of money the financial institution gathers from the credit card sells.
Thus, the borrower has a cheap source of funds and the lender obtains guaranteed repayment of the money lent. Moreover, the company does not have to worry about repayment as it is automatically deducted from the sells each month. This financial tool is becoming more and more popular as it provides inexpensive financing, higher loan amounts, fast approval and a very easy and hassle free repayment program.
Secured business loans are becoming more and more common among businessmen as small companies begin to own their own commercial offices and headquarters instead of renting. Thus, they can take advantage of real estate by obtaining finance through secured loans. But, they can also use as security their future sells, thus obtaining finance with alternative forms of collateral.
Real Estate Based Business Loans And Lines of Credit
There are business loans that are secured with real estate properties just like regular mortgage loans and home equity loans. The sole difference is that these properties belong to a company instead of a particular person. Nevertheless the concept is just the same: the property's value guarantees repayment of the money to the lender and thus reduces the risk of the transaction letting the lender offer lower interest rates and more advantageous loan terms.
There are commercial mortgages (the equivalent to home mortgages), commercial second mortgages (the equivalent to home equity loans) and commercial lines of credit based on equity which are just like home equity lines of credit. Equity is the difference between the value of the property and the amount of money borrowed that the property is already guaranteeing.
However, commerce and companies have other property's that can be used as collateral for loans. Intellectual property, trade marks, etc. can also be used to guarantee a loan as they are usually of great value. A company has many possessions that can be used to guarantee a line of credit or a loan. You will just need to consult with credit experts at an agency or financial institution since detailed information on this matter exceeds the purpose of this article.
Loans And Lines Of Credit Based On Future Sells
Finally there are also loans and lines of credit that are based on the future sells of the company. These financial products work as follows: The financial institution processes credit card payments for the company that wants to borrow money and thus, knows exactly the average income of the company in terms of credit card payments. Thus, the financial institution will be able to lend money in the form of a loan or line of credit and agree loan installments or minimum payments that will be withdrawn directly from the amount of money the financial institution gathers from the credit card sells.
Thus, the borrower has a cheap source of funds and the lender obtains guaranteed repayment of the money lent. Moreover, the company does not have to worry about repayment as it is automatically deducted from the sells each month. This financial tool is becoming more and more popular as it provides inexpensive financing, higher loan amounts, fast approval and a very easy and hassle free repayment program.
Starting Over With Debt Consolidation Loans
by: Amanda Hash
Debt Consolidation can provide you with a new beginning but it will not eliminate all your debt within the blink of an eye. Debt consolidation can contribute to debt elimination but it is a long process that may take years. What debt consolidation can provide is a significant reduction on your expenses in terms of debt repayment and thus it can provide you with more available income for other purposes.
Debt Consolidation Explained
Consolidation basically consists on replacing all your current expensive debt with a single financial product with a lower interest rate and lower monthly payments. Lower monthly payments can be obtained either by the mere reduction on the interest rate charged for financing the money owed or by combining this with an extension on the repayment program.
Debt consolidation liberates a fair amount of income that otherwise would have to be used for debt repayment. The extra money can be used for any purpose you want. However, it is suggested that it is used for further eliminating outstanding debt. This accelerates the debt elimination process and you will find yourself debt free within a shorter period of time.
Debt Consolidation Loans
These financial products are known as debt consolidation loans. These loans are meant to replace all existing debt with them. The interest rate charged for debt consolidation loans tends to be lower than the rates charged for other financial products with the sole exemption of other secured loans like home loans, home equity loans and some student loans which are subsidized.
Actually most debt consolidation loans are home equity loans or mortgage loans featuring rates below 8%. If you compare these rates with the abusive 20% APR that some credit cards and store cards charge for finance purchases, you can easily understand the kind of money you will be saving by consolidating your debt with a debt consolidation loan.
There are however, unsecured consolidation loans available too. The only problem is that the unsecured nature of these loans limits their usefulness as consolidation tools. Unsecured loans feature higher interest rates, lower loan amounts and usually shorter repayment programs than secured debt consolidation loans. This implies higher monthly payments too and thus, those who want to consolidate their debt will not find such a good and beneficial solution with unsecured consolidation loans.
Where To Get Them
If you are looking for debt consolidation loans, the best thing to do is to make a quick search on the internet for debt consolidation loans and you will be presented with tons of results. Among these results, you will find lenders offering debt consolidation programs. You can request from them loan quotes in order to compare what they have to offer and after picking a particular lender you can request a debt consolidation loan. Applications are usually processed online and you will have an answer in a matter of minutes.
Debt Consolidation can provide you with a new beginning but it will not eliminate all your debt within the blink of an eye. Debt consolidation can contribute to debt elimination but it is a long process that may take years. What debt consolidation can provide is a significant reduction on your expenses in terms of debt repayment and thus it can provide you with more available income for other purposes.
Debt Consolidation Explained
Consolidation basically consists on replacing all your current expensive debt with a single financial product with a lower interest rate and lower monthly payments. Lower monthly payments can be obtained either by the mere reduction on the interest rate charged for financing the money owed or by combining this with an extension on the repayment program.
Debt consolidation liberates a fair amount of income that otherwise would have to be used for debt repayment. The extra money can be used for any purpose you want. However, it is suggested that it is used for further eliminating outstanding debt. This accelerates the debt elimination process and you will find yourself debt free within a shorter period of time.
Debt Consolidation Loans
These financial products are known as debt consolidation loans. These loans are meant to replace all existing debt with them. The interest rate charged for debt consolidation loans tends to be lower than the rates charged for other financial products with the sole exemption of other secured loans like home loans, home equity loans and some student loans which are subsidized.
Actually most debt consolidation loans are home equity loans or mortgage loans featuring rates below 8%. If you compare these rates with the abusive 20% APR that some credit cards and store cards charge for finance purchases, you can easily understand the kind of money you will be saving by consolidating your debt with a debt consolidation loan.
There are however, unsecured consolidation loans available too. The only problem is that the unsecured nature of these loans limits their usefulness as consolidation tools. Unsecured loans feature higher interest rates, lower loan amounts and usually shorter repayment programs than secured debt consolidation loans. This implies higher monthly payments too and thus, those who want to consolidate their debt will not find such a good and beneficial solution with unsecured consolidation loans.
Where To Get Them
If you are looking for debt consolidation loans, the best thing to do is to make a quick search on the internet for debt consolidation loans and you will be presented with tons of results. Among these results, you will find lenders offering debt consolidation programs. You can request from them loan quotes in order to compare what they have to offer and after picking a particular lender you can request a debt consolidation loan. Applications are usually processed online and you will have an answer in a matter of minutes.
The Timing Issue On Government Grants
by: Amanda Hash
Government grants are not available all the time and you need to be well aware of this fact in order not to let pass by an opportunity just because you did not know that there was a time limit for submissions' presentations at the government agency that provided the financial aid. Thus, when it comes to government grants, time is of the essence.
Government Grants Explained
Government grants are awarded by government agencies to those who meet certain eligibility criteria that the agency defines. Grants are a form of financial aid that does not need to be reimbursed and thus are greatly demanded. That's the reason why there are such strict requirements in order to get approved for a government grant.
One of the requirements is obviously, to request the grant by filling the appropriate forms attaching all the documentation and information required by the government agency. There is always a period of time in the year when requests are received at the government agency and there is a very strict policy regarding non receivable out-of-date applications.
Timing Is The Key Word
Thus, in order to obtain a government grant successfully, you will need to prepare yourself. It is important that you collect all the information needed to present a government grant request and that you find out which is the proper time to apply for the government grant. This information can be obtained from the government agencies' internet sites that usually have a grants section.
Also, there are many sites on the internet offering resources regarding government grants and detailed explanations on how and when to apply to each particular government grant. In any case, you should always confirm with the agency this information as any stipulation may change with a mere resolution from the agencies' head. You need to pay special attention to the period when applications are received and the due dates. A mere delay of a single day may cause immediate rejection of your application.
Federal Register
Each time a government agency makes funds available through government grants, they are required to announce the terms for approval and the period for application presentations in the Federal Register. The Federal Register has a web site you can consult and so do the government agencies. You will be able to find there all the information you need in order to successfully apply for a government grant. There are also some sites that take the job to put all the information from each agency together and present it in a user-friendly manner. Some of these sites also offer assistance on filling the applications and advice as to which grant to apply and how to do it in order to boost your chances of getting approved.
Government grants are not available all the time and you need to be well aware of this fact in order not to let pass by an opportunity just because you did not know that there was a time limit for submissions' presentations at the government agency that provided the financial aid. Thus, when it comes to government grants, time is of the essence.
Government Grants Explained
Government grants are awarded by government agencies to those who meet certain eligibility criteria that the agency defines. Grants are a form of financial aid that does not need to be reimbursed and thus are greatly demanded. That's the reason why there are such strict requirements in order to get approved for a government grant.
One of the requirements is obviously, to request the grant by filling the appropriate forms attaching all the documentation and information required by the government agency. There is always a period of time in the year when requests are received at the government agency and there is a very strict policy regarding non receivable out-of-date applications.
Timing Is The Key Word
Thus, in order to obtain a government grant successfully, you will need to prepare yourself. It is important that you collect all the information needed to present a government grant request and that you find out which is the proper time to apply for the government grant. This information can be obtained from the government agencies' internet sites that usually have a grants section.
Also, there are many sites on the internet offering resources regarding government grants and detailed explanations on how and when to apply to each particular government grant. In any case, you should always confirm with the agency this information as any stipulation may change with a mere resolution from the agencies' head. You need to pay special attention to the period when applications are received and the due dates. A mere delay of a single day may cause immediate rejection of your application.
Federal Register
Each time a government agency makes funds available through government grants, they are required to announce the terms for approval and the period for application presentations in the Federal Register. The Federal Register has a web site you can consult and so do the government agencies. You will be able to find there all the information you need in order to successfully apply for a government grant. There are also some sites that take the job to put all the information from each agency together and present it in a user-friendly manner. Some of these sites also offer assistance on filling the applications and advice as to which grant to apply and how to do it in order to boost your chances of getting approved.
Wednesday, January 6, 2010
Useful Considerations About Loans
by: Amanda Hash
Things to find out BEFORE you go to the first lending agent are: Interest rates, payback terms available, administration fees or arrangement fees and pre-payment penalties. Investigate on the Internet what conditions the market has in general, take note and then start looking for a suitable lender.
Interest Rates
Sometimes they fluctuate, so if you are not desperate, wait a little and see how they tend to move. The range goes from .6% to 8%, depending on the type of loan you are looking for and the payback term. Consider that credit card rates are in the neighborhood of 18%, so it can be useful to pay off your credit card debt with a more accessible tipe of financing.
Fees
Compare fees, but bear in mind not to pay an up-front fee to a doubtful lender or one that is not well-known or trustworthy. Perhaps you could ask your acquaintances or family to recommend you a couple and then make your choice.
Small Writing
The small writing must never be left unread. You might want to ask the agent for a copy of the contract before you actually sign it, so as to avoid taking too much time from the agent and be able to look into it in detail and understanding everything before you make a no-return mistake.
Do not Trust Your Memory
Take a paper and pen and jot down everything that is said during the interviews with agents, as well as the correct name of the interviewer, since you might have to speak to someone else in the course of the preparation and need to refer to this conversation.
Pre-payment Penalties
Sometimes, there are penalties that are applied to the borrower if he wishes to payback the outstanding balance with a lumpsum. Why is that? Because you are depriving the lender of his precious money, that's why. You are avoiding the payment of interest, the lender's source of income.
Application Form
Your application form should be tidy and totally legible. You do not want it to look like a butcher's notepad, do you? Even if you ARE in the meat business, the paperwork is done in an office and processed by office workers, so make sure all the papers you hand in are conveniently clean and neat.
In Case Of A Dispute
If you should have any dispute, go back to all the notes you made, the copy of the contract with the small writing, the names of all the agents you spoke to during the whole process, and prepare your defense. And remember to seek a higher authority to direct your complaint or dispute.
There is much more to a loan than will fit in this space, but we feel we have considered the most important factors. We wish you all the best.
Things to find out BEFORE you go to the first lending agent are: Interest rates, payback terms available, administration fees or arrangement fees and pre-payment penalties. Investigate on the Internet what conditions the market has in general, take note and then start looking for a suitable lender.
Interest Rates
Sometimes they fluctuate, so if you are not desperate, wait a little and see how they tend to move. The range goes from .6% to 8%, depending on the type of loan you are looking for and the payback term. Consider that credit card rates are in the neighborhood of 18%, so it can be useful to pay off your credit card debt with a more accessible tipe of financing.
Fees
Compare fees, but bear in mind not to pay an up-front fee to a doubtful lender or one that is not well-known or trustworthy. Perhaps you could ask your acquaintances or family to recommend you a couple and then make your choice.
Small Writing
The small writing must never be left unread. You might want to ask the agent for a copy of the contract before you actually sign it, so as to avoid taking too much time from the agent and be able to look into it in detail and understanding everything before you make a no-return mistake.
Do not Trust Your Memory
Take a paper and pen and jot down everything that is said during the interviews with agents, as well as the correct name of the interviewer, since you might have to speak to someone else in the course of the preparation and need to refer to this conversation.
Pre-payment Penalties
Sometimes, there are penalties that are applied to the borrower if he wishes to payback the outstanding balance with a lumpsum. Why is that? Because you are depriving the lender of his precious money, that's why. You are avoiding the payment of interest, the lender's source of income.
Application Form
Your application form should be tidy and totally legible. You do not want it to look like a butcher's notepad, do you? Even if you ARE in the meat business, the paperwork is done in an office and processed by office workers, so make sure all the papers you hand in are conveniently clean and neat.
In Case Of A Dispute
If you should have any dispute, go back to all the notes you made, the copy of the contract with the small writing, the names of all the agents you spoke to during the whole process, and prepare your defense. And remember to seek a higher authority to direct your complaint or dispute.
There is much more to a loan than will fit in this space, but we feel we have considered the most important factors. We wish you all the best.
Getting The Amount of Business Finance You Need
by: pat lee
The business owner may typically wish to purchase a guest house, restaurant, industrial unit, bakery, shop, shop with flat, pub, take away, cafe, hotel, leisure centre and financial outlet. All these businesses are able to obtain finance if they match the client's circumstances correctly to be purchased via business finance or by refinancing existing assets.
Business lending has evolved to be more flexible and accommodating over the last few years. Lenders have started to take a more open view on lending and lending criteria is more open-minded. There have been some new specialist lenders who have come into the market with a view to give new lending features which would accommodate a lot of potential business owners including high loan to value up to 85% for the mortgage, adverse credit history, self cert, no accounts, no previous trading history, start-ups and minimum paperwork requirements. These loans can often be authorised in days.
Due to the complexity, risk and number of business lenders available within the UK it would be wise to get a suitable business finance broker to assist you with your lending requirements. A business mortgage should be regarded as an asset so making sure it is the right one for the business is essential in order to maximum return on the business owner's investment.
The business owner may typically wish to purchase a guest house, restaurant, industrial unit, bakery, shop, shop with flat, pub, take away, cafe, hotel, leisure centre and financial outlet. All these businesses are able to obtain finance if they match the client's circumstances correctly to be purchased via business finance or by refinancing existing assets.
Business lending has evolved to be more flexible and accommodating over the last few years. Lenders have started to take a more open view on lending and lending criteria is more open-minded. There have been some new specialist lenders who have come into the market with a view to give new lending features which would accommodate a lot of potential business owners including high loan to value up to 85% for the mortgage, adverse credit history, self cert, no accounts, no previous trading history, start-ups and minimum paperwork requirements. These loans can often be authorised in days.
Due to the complexity, risk and number of business lenders available within the UK it would be wise to get a suitable business finance broker to assist you with your lending requirements. A business mortgage should be regarded as an asset so making sure it is the right one for the business is essential in order to maximum return on the business owner's investment.
Are UK Lenders partially to blame for their lack of consumer confidence
by: pat lee
The online credit information provider said rising interest rates earlier this year had already caused
I lenders to apply more stringent criteria and they were now a tightening up their credit checks even further.
Neil Munroe, external affairs
I director for Equifax, said: "Lenders , are looking deeper into people's credit histories. In particular, we
I believe they will be looking in more detail for early warning signs of consumers getting into financial difficulties. So just one late payment on a credit agreement that might not previously have been a major issue for lenders may now mean the difference between someone getting a loan or not. or having to pay a high rate of interest." Mr Munroe said lenders were
also likely to be looking closely at how consumers service their debts. He said: "Lenders are looking more closely at borrowers' credit
I histories, any other outstanding debt and their level of disposable income. Equifax is developing specific scoring tools to predict indebtedness and potential bankruptcy, based on past management of credit.
The online credit information provider said rising interest rates earlier this year had already caused
I lenders to apply more stringent criteria and they were now a tightening up their credit checks even further.
Neil Munroe, external affairs
I director for Equifax, said: "Lenders , are looking deeper into people's credit histories. In particular, we
I believe they will be looking in more detail for early warning signs of consumers getting into financial difficulties. So just one late payment on a credit agreement that might not previously have been a major issue for lenders may now mean the difference between someone getting a loan or not. or having to pay a high rate of interest." Mr Munroe said lenders were
also likely to be looking closely at how consumers service their debts. He said: "Lenders are looking more closely at borrowers' credit
I histories, any other outstanding debt and their level of disposable income. Equifax is developing specific scoring tools to predict indebtedness and potential bankruptcy, based on past management of credit.
Tuesday, January 5, 2010
Accounts Receivable Financing- Secrets
by: Gregg Elberg
As used in this article, secret means: revealed only to the initiated; kept from knowledge or view; and designed to elude observation or detection.
The first secret- “revealed only to the initiated” relates to the fact that most schools, even business schools, do not teach the subject of factoring or purchase order financing; most banks do not offer these financing facilities as products. Therefore, it is not surprising that many businesses are unaware of the cash potential that lays dormant in their business invoices.
Let's suppose you own a small to medium business and you depend on customers paying invoices within a 45-60 day period for your working capital. In essence, you are extending credit like a bank to your customers. For that period of time your cash is tied up in your invoices- your accounts receivable. This limits growth and may create problems regarding meeting payroll and paying your suppliers. Accounts receivable financing is the process of selling your invoices for cash as soon as they are issued which allows you to make more effective use of your assets. Purchase order financing is the process of obtaining a third party commitment to pay your suppliers as soon as products are received by your clients (in advance of payment by you or your client), based on the surety of an accounts receivable financing arrangement.
All businesses are limited in their growth and profits by the amount of capital and cash flow available to take advantage of business opportunities. The availability of virtually unlimited cash creates a powerful paradigm for potential growth. It also can expand your thinking about what business is possible and how you might go out and develop new business.
The second secret- “kept from knowledge or view” relates to the practice of non-notification factoring. Some business people are concerned that working with a factor, an accounts receivable financing company, may not be viewed favorably by their customers. In many cases it is possible to structure a transaction legally so that the accounts receivable financing is transparent to the ultimate customer.
The third secret- “designed to elude observation or detection” has to do with your business plan and how the way you think about the world can affect your success. In 2006 Prime Time Productions produced a film and a book called “The Secret”. The film dramatically describes the “Law of Attraction” which asserts that people's feelings and thoughts attract real events in the world into their lives. Can your feelings and thoughts attract more business and success? Is the visualization of what you want an aid for manifesting your business goals? Is The Secret “just a new spin on the very old (and decidedly not secret” The Power of Positive Thinking (a book by Norman Vincent Peal written in 1952) wedded to ‘ask and you shall receive' -as opined by Karin Klein, editorial writer for the Los Angeles Times? Did The Secret fail to discover the real roots of powerful thinking?
In the book, “The Diamond Cutter”, Geshe Michael Roach examines The Budda on Managing your Business and your Life. Roach graduated from Princeton University with honors, studied the ancient wisdom of Tibet and traveled to the Tibetan Lamas at the seat of His Holiness, the Dalai Lama. In 1983 he took the vows of a Buddhist monk.
His teacher encouraged him to enter the world of business. Mr. Roach choose the diamond business. He hid the fact that he was a monk and maintained a façade of a normal American businessman on the outside. The business developed from nothing to a one hundred million dollar per year business.
The original book, “The Diamond Cutter” is the “oldest dated book in the world that was printed rather than being written out by hand. The British Museum holds a copy that is dated A.D 868.” It is a written record of Buddha teachings from over 2,500 years ago. In brief, the central principles are: 1) business should be successful and make money in a clean and honest way; 2) you should enjoy the money and stay in good health; and 3) you should be able to look back ay your business and say your years of doing business had some meaning leaving some good marks in the world. I highly recommend “The Diamond Cutter” vs. “The Secret”.
The bottom line: accounts receivable financing and purchase order financing may be the secrets to your business' financial success. If you read and follow the principles of “The Diamond Cutter” you can expand your opportunities for exponential growth based on the 2500 year old teachings of Buddha, as explained by Mr. Roach.
As used in this article, secret means: revealed only to the initiated; kept from knowledge or view; and designed to elude observation or detection.
The first secret- “revealed only to the initiated” relates to the fact that most schools, even business schools, do not teach the subject of factoring or purchase order financing; most banks do not offer these financing facilities as products. Therefore, it is not surprising that many businesses are unaware of the cash potential that lays dormant in their business invoices.
Let's suppose you own a small to medium business and you depend on customers paying invoices within a 45-60 day period for your working capital. In essence, you are extending credit like a bank to your customers. For that period of time your cash is tied up in your invoices- your accounts receivable. This limits growth and may create problems regarding meeting payroll and paying your suppliers. Accounts receivable financing is the process of selling your invoices for cash as soon as they are issued which allows you to make more effective use of your assets. Purchase order financing is the process of obtaining a third party commitment to pay your suppliers as soon as products are received by your clients (in advance of payment by you or your client), based on the surety of an accounts receivable financing arrangement.
All businesses are limited in their growth and profits by the amount of capital and cash flow available to take advantage of business opportunities. The availability of virtually unlimited cash creates a powerful paradigm for potential growth. It also can expand your thinking about what business is possible and how you might go out and develop new business.
The second secret- “kept from knowledge or view” relates to the practice of non-notification factoring. Some business people are concerned that working with a factor, an accounts receivable financing company, may not be viewed favorably by their customers. In many cases it is possible to structure a transaction legally so that the accounts receivable financing is transparent to the ultimate customer.
The third secret- “designed to elude observation or detection” has to do with your business plan and how the way you think about the world can affect your success. In 2006 Prime Time Productions produced a film and a book called “The Secret”. The film dramatically describes the “Law of Attraction” which asserts that people's feelings and thoughts attract real events in the world into their lives. Can your feelings and thoughts attract more business and success? Is the visualization of what you want an aid for manifesting your business goals? Is The Secret “just a new spin on the very old (and decidedly not secret” The Power of Positive Thinking (a book by Norman Vincent Peal written in 1952) wedded to ‘ask and you shall receive' -as opined by Karin Klein, editorial writer for the Los Angeles Times? Did The Secret fail to discover the real roots of powerful thinking?
In the book, “The Diamond Cutter”, Geshe Michael Roach examines The Budda on Managing your Business and your Life. Roach graduated from Princeton University with honors, studied the ancient wisdom of Tibet and traveled to the Tibetan Lamas at the seat of His Holiness, the Dalai Lama. In 1983 he took the vows of a Buddhist monk.
His teacher encouraged him to enter the world of business. Mr. Roach choose the diamond business. He hid the fact that he was a monk and maintained a façade of a normal American businessman on the outside. The business developed from nothing to a one hundred million dollar per year business.
The original book, “The Diamond Cutter” is the “oldest dated book in the world that was printed rather than being written out by hand. The British Museum holds a copy that is dated A.D 868.” It is a written record of Buddha teachings from over 2,500 years ago. In brief, the central principles are: 1) business should be successful and make money in a clean and honest way; 2) you should enjoy the money and stay in good health; and 3) you should be able to look back ay your business and say your years of doing business had some meaning leaving some good marks in the world. I highly recommend “The Diamond Cutter” vs. “The Secret”.
The bottom line: accounts receivable financing and purchase order financing may be the secrets to your business' financial success. If you read and follow the principles of “The Diamond Cutter” you can expand your opportunities for exponential growth based on the 2500 year old teachings of Buddha, as explained by Mr. Roach.
How to Get Your Small Business Loan in Tough Times
by: Rob Warlow
During the good times there is a feeling that nothing can go wrong and so as long as business owners have a half decent idea and good security or collateral to back it up, then they have no problem in obtaining finance. But once the ‘feel good factor' ebbs away then attitudes can slowly change over time.
All is not lost though! There are still some steps you can take to persuade your bank manager to either support your new business idea or support your expansion plans. Here are some of the things you can do.
Review Your Plan or Idea
All the best plans in the world change over time as the general business climate changes. Nothing ever stays still and the businesses that survive know that their market never stays still.
Take a step back and examine whether your market has changed. Have recent events dented the confidence or purchasing ability of your target market? Will your customers be thinking twice about ordering your all-singing-and-dancing product or service? Will they no longer be able to accept your high price even taking into account your quality service? Have your costs significantly increased rendering your idea or business unprofitable?
You must not make the assumption that because your plan was viable a few months ago that it is still viable today. Be wise enough to re-look at all the underlying factors that made you come to the conclusion it was a good idea. Is it still such a good move?
Write a Business Plan
So many business owners still don't write business plans; they don't see the value obtained in exchange for the amount of time invested in researching and writing one. Even in the good times banks like to see a Plan but during times when banks may need more persuading then a Business Plan is essential.
Whilst many regard Business Plans as documents written solely for the bank this is not the case. A Business Plan must be seen as a tool which can act both as a summary for the bank and as a control and check for you. A well researched Plan will help you understand the pitfalls of your new venture; it will highlight the flaws in your thinking and potentially save you from making an expensive mistake.
Before you approach the bank commit to writing a Business Plan; it may be less painful than you think!
Watch Your Cash Flow
When the business community starts talking about downturns and that dreaded ‘R' word sometimes the talk can become a self-fulfilling prophecy! Businesses can quickly decide to tighten their belts and soon your orders dry up and it takes longer for you to get paid for work you have already done. Cash becomes tight.
You need to be prepared for this. Review all your expenses. Do you really need all the ‘toys' that go with running a business today? When did you last review your supplier's pricing? Are you still getting the best deal in the market? Are your payment terms very clear such that all your customers know that if your invoice says 30 days, then you mean 30 days and not 60 days!
The vast majority of business failures do not arise because of lack of profit, it is usually down to lack of cash. Cash is the life blood of all businesses and without it businesses die. Don't fall victim to this one; watch your expenses and chase the cash.
What does this have to do with getting the bank on your side? Simple. Your bank likes to see a well run account. It does not want to see an account that is under pressure and it certainly does not want to see itself returning your payments due to lack of funds. In times like this you need your bank working for you, not against you.
Talk to Your Bank Manager
If your business is beginning to suffer for many owners the natural tendency is to adopt the ostrich position - head in the sand! Problems do not go away by themselves, no matter how hard you try to convince yourself.
If your problems are beginning to affect your business then one of the first people you need to go and see is your bank manager. The old saying, ‘Forewarned is forearmed' is so true. No one likes surprises sprung on them and a banker is no different. You must share your concerns and who knows, they may even be able to help you!
Hiding away from the Bank is no solution. A lack of facts or being kept in the dark is a sure way of creating panic and this can lead to incorrect and disastrous decisions being made. Avoid this by talking and informing.
Banks can be known for making life tough but you have a part to play. Make it easier for your bank to support you by providing them with all the necessary information they need and don't forget that you have your part to play by taking the right decisions for you and your business.
During the good times there is a feeling that nothing can go wrong and so as long as business owners have a half decent idea and good security or collateral to back it up, then they have no problem in obtaining finance. But once the ‘feel good factor' ebbs away then attitudes can slowly change over time.
All is not lost though! There are still some steps you can take to persuade your bank manager to either support your new business idea or support your expansion plans. Here are some of the things you can do.
Review Your Plan or Idea
All the best plans in the world change over time as the general business climate changes. Nothing ever stays still and the businesses that survive know that their market never stays still.
Take a step back and examine whether your market has changed. Have recent events dented the confidence or purchasing ability of your target market? Will your customers be thinking twice about ordering your all-singing-and-dancing product or service? Will they no longer be able to accept your high price even taking into account your quality service? Have your costs significantly increased rendering your idea or business unprofitable?
You must not make the assumption that because your plan was viable a few months ago that it is still viable today. Be wise enough to re-look at all the underlying factors that made you come to the conclusion it was a good idea. Is it still such a good move?
Write a Business Plan
So many business owners still don't write business plans; they don't see the value obtained in exchange for the amount of time invested in researching and writing one. Even in the good times banks like to see a Plan but during times when banks may need more persuading then a Business Plan is essential.
Whilst many regard Business Plans as documents written solely for the bank this is not the case. A Business Plan must be seen as a tool which can act both as a summary for the bank and as a control and check for you. A well researched Plan will help you understand the pitfalls of your new venture; it will highlight the flaws in your thinking and potentially save you from making an expensive mistake.
Before you approach the bank commit to writing a Business Plan; it may be less painful than you think!
Watch Your Cash Flow
When the business community starts talking about downturns and that dreaded ‘R' word sometimes the talk can become a self-fulfilling prophecy! Businesses can quickly decide to tighten their belts and soon your orders dry up and it takes longer for you to get paid for work you have already done. Cash becomes tight.
You need to be prepared for this. Review all your expenses. Do you really need all the ‘toys' that go with running a business today? When did you last review your supplier's pricing? Are you still getting the best deal in the market? Are your payment terms very clear such that all your customers know that if your invoice says 30 days, then you mean 30 days and not 60 days!
The vast majority of business failures do not arise because of lack of profit, it is usually down to lack of cash. Cash is the life blood of all businesses and without it businesses die. Don't fall victim to this one; watch your expenses and chase the cash.
What does this have to do with getting the bank on your side? Simple. Your bank likes to see a well run account. It does not want to see an account that is under pressure and it certainly does not want to see itself returning your payments due to lack of funds. In times like this you need your bank working for you, not against you.
Talk to Your Bank Manager
If your business is beginning to suffer for many owners the natural tendency is to adopt the ostrich position - head in the sand! Problems do not go away by themselves, no matter how hard you try to convince yourself.
If your problems are beginning to affect your business then one of the first people you need to go and see is your bank manager. The old saying, ‘Forewarned is forearmed' is so true. No one likes surprises sprung on them and a banker is no different. You must share your concerns and who knows, they may even be able to help you!
Hiding away from the Bank is no solution. A lack of facts or being kept in the dark is a sure way of creating panic and this can lead to incorrect and disastrous decisions being made. Avoid this by talking and informing.
Banks can be known for making life tough but you have a part to play. Make it easier for your bank to support you by providing them with all the necessary information they need and don't forget that you have your part to play by taking the right decisions for you and your business.
Avoid Business Cash Advance and Credit Card Processing Problems
by: Steve Bush
Business loan strategic solutions and credit card processing are more connected than most commercial borrowers realize, and changes to either are likely to have measurable impacts on profitability. Merchants should take advantage of profitable business finance benefits by successfully coordinating processing and receivables management. The business financing benefits will be especially noticeable if several typical processing and merchant cash advance difficulties can be precluded.
Even thriving merchants periodically need more working capital than they can obtain from a bank business loan. One of the most critical business financing tasks for any commercial borrower is to make sure that short-term cash needs are fulfilled. This is frequently difficult and sometimes impossible for the average merchant.
Effective and timely use of a prudent working capital business loan is an increasingly critical business financing tool when a merchant is faced with a short-term cash shortfall. Commercial borrowers should be forewarned that there can be a substantial number of potential difficulties in coordinating credit card processing, receivables factoring and business cash advance services.
Using Credit Card Receivables and Credit Card Processing
Most merchants have documented credit card processing activity and sales volume. This documentation of processing activity and sales volume is a financial asset, since up to $300,000 can typically be obtained via a business cash advance based on projected future sales volume.
Business Finance Recommendations
Merchants should be aware that there are at least ten serious difficulties that they need to be prepared for before obtaining a business cash advance. These problems are described below to help owners avoid these common merchant cash advance and credit card processing obstacles. After each potential problem is described, a suggested processing and receivable factoring solution is provided.
(1) Working Capital Management Problem to Avoid: Closing costs. Suggested requirement: No closing costs.
(2) Credit Card Financing Obstacle to Anticipate and Eliminate: Fees charged up-front. Recommended requirement: Zero up-front fees.
(3) Credit Card Processing Problem to Eliminate: Collateral required. Recommended requirement: No collateral required.
(4) Credit Card Factoring Difficulty: Financial statements required. Suggested requirement: No financial statements required except for larger business cash advances.
(5) Credit Card Receivables Obstacle to Anticipate: Required to pay off the merchant cash advance with fixed payments. Recommended requirement: Fixed payments not required.
(6) Working Capital Financing Obstacle to Eliminate: Required to pay off the business cash advance over a fixed term. Recommended requirement: Fixed term for repayment not required.
(7) Credit Card Receivables Factoring Problem to Avoid: 2-3 years of ownership required to qualify. Suggested requirement: 1 year of ownership.
(8) Credit Card Processing Difficulty: Credit scores of at least 680 required. Suggested requirement: Acceptable credit scores of 500 and higher.
(9) Credit Card Factoring Difficulty: Business cash advance limited to $50,000. Suggested requirement: Maximum cash advance of $300,000.
(10) Merchant Cash Advance Problem to Avoid: 12 to 24 months of documented sales of $12,000 to $25,000 or more required. Preferred requirement: 6 months of $5,000 or more.
Can the Ten Obstacles Discussed Above Be Avoided in All Cases?
There are viable credit card receivables programs which avoid all of the problems described above. It is not necessary to accept any of these problems in order to obtain business cash advances based on future sales.
It would be a rare situation for all of these potential business finance problems to be of primary importance to an owner. Most commercial borrowers will encounter several of these problems if they are evaluating business cash advance programs that use processing and receivables factoring.
Commercial borrowers should also be alert for business cash advance and credit card processing problems not mentioned above. However, the absence of all ten problems described is a good start toward achieving substantial business finance improvements in working capital management.
Business loan strategic solutions and credit card processing are more connected than most commercial borrowers realize, and changes to either are likely to have measurable impacts on profitability. Merchants should take advantage of profitable business finance benefits by successfully coordinating processing and receivables management. The business financing benefits will be especially noticeable if several typical processing and merchant cash advance difficulties can be precluded.
Even thriving merchants periodically need more working capital than they can obtain from a bank business loan. One of the most critical business financing tasks for any commercial borrower is to make sure that short-term cash needs are fulfilled. This is frequently difficult and sometimes impossible for the average merchant.
Effective and timely use of a prudent working capital business loan is an increasingly critical business financing tool when a merchant is faced with a short-term cash shortfall. Commercial borrowers should be forewarned that there can be a substantial number of potential difficulties in coordinating credit card processing, receivables factoring and business cash advance services.
Using Credit Card Receivables and Credit Card Processing
Most merchants have documented credit card processing activity and sales volume. This documentation of processing activity and sales volume is a financial asset, since up to $300,000 can typically be obtained via a business cash advance based on projected future sales volume.
Business Finance Recommendations
Merchants should be aware that there are at least ten serious difficulties that they need to be prepared for before obtaining a business cash advance. These problems are described below to help owners avoid these common merchant cash advance and credit card processing obstacles. After each potential problem is described, a suggested processing and receivable factoring solution is provided.
(1) Working Capital Management Problem to Avoid: Closing costs. Suggested requirement: No closing costs.
(2) Credit Card Financing Obstacle to Anticipate and Eliminate: Fees charged up-front. Recommended requirement: Zero up-front fees.
(3) Credit Card Processing Problem to Eliminate: Collateral required. Recommended requirement: No collateral required.
(4) Credit Card Factoring Difficulty: Financial statements required. Suggested requirement: No financial statements required except for larger business cash advances.
(5) Credit Card Receivables Obstacle to Anticipate: Required to pay off the merchant cash advance with fixed payments. Recommended requirement: Fixed payments not required.
(6) Working Capital Financing Obstacle to Eliminate: Required to pay off the business cash advance over a fixed term. Recommended requirement: Fixed term for repayment not required.
(7) Credit Card Receivables Factoring Problem to Avoid: 2-3 years of ownership required to qualify. Suggested requirement: 1 year of ownership.
(8) Credit Card Processing Difficulty: Credit scores of at least 680 required. Suggested requirement: Acceptable credit scores of 500 and higher.
(9) Credit Card Factoring Difficulty: Business cash advance limited to $50,000. Suggested requirement: Maximum cash advance of $300,000.
(10) Merchant Cash Advance Problem to Avoid: 12 to 24 months of documented sales of $12,000 to $25,000 or more required. Preferred requirement: 6 months of $5,000 or more.
Can the Ten Obstacles Discussed Above Be Avoided in All Cases?
There are viable credit card receivables programs which avoid all of the problems described above. It is not necessary to accept any of these problems in order to obtain business cash advances based on future sales.
It would be a rare situation for all of these potential business finance problems to be of primary importance to an owner. Most commercial borrowers will encounter several of these problems if they are evaluating business cash advance programs that use processing and receivables factoring.
Commercial borrowers should also be alert for business cash advance and credit card processing problems not mentioned above. However, the absence of all ten problems described is a good start toward achieving substantial business finance improvements in working capital management.
Monday, January 4, 2010
5 Essential Tips to Finding the Right Payday Lender
by: Michael New Jr.
First, consumers should look to deal with companies who are members of the Community of Financial Services Association of America (CFSA). Companies that belong to CFSA agree to adhere to its consumer advocacy program and best practices policy. Borrowers who use a CFSA member company are given the assurance that they are dealing with a lender who is registered and licensed in the state where they operate, a lender who promises to limit the fees they charge, and provide a payment plan for consumers who find they cannot pay off their loan on the next payday. Borrowers who shop online should ask the lender if they are member of CFSA and know they are dealing with a reputable lender.
Second, borrowers should also look for the fee chart that clearly illustrates the cost associated with the cash advance loan. A typical fee for an online lender is between $17- and $30- per $100- borrowed. Borrowers should avoid cash advance lenders who charge administrative fees, loan insurance, or other add-on fees. A consumer will pay the fee or finance charge at the same time the amount borrowed is repaid. Loan terms should easy to find in a store or on a website and should be easy to understand.
Third, borrowers who need money longer than a single pay period should find out whether a lender will allow them to extend the loan longer than the initial term. Most lenders will allow borrowers to extend one to four times, but borrowers should make certain that the lender will not automatically extend their loan for them. Consumers should only deal with lenders who extend a loan when it is requested by the borrower. Some unregulated lenders will take advantage of borrowers by automatically extending a customer's loan and charging the customer an additional fee. Reputable lenders leave the choice to extend a loan in the borrower's hands.
Fourth, online borrowers should be able to call, write, or email a lender. If a lender does not post an email address, a contact telephone number, and a mailing address then the lender is probably not interested in resolving consumer concerns. Honest online lenders have different ways consumers can contact them to resolve questions and receive answers regarding the loan. Some unregulated lenders will avoid posting a telephone number or a mailing address to limit the amount of contact they have with their customers. A consumer's inability to contact a lender can lead to confusion on the part of the consumer. Reputable lenders want to discuss customer questions or concerns with their borrowers.
Lastly, borrowers should look for lenders who are well established. There are many lenders that are new to offering short-term loans. Sometimes these lenders can overlook important factors that are critical to a successful loan. Consumers should ask their lender how many years they have been around and how many loans they have serviced. If they have been established at least five or more years they are more likely to resolve any concern or question one may have because they have likely faced similar situations before. Experience in short-term lending does matter. Consumers who use established lenders are likely to have fewer problems.
Most lenders strive to satisfy their consumers' money needs. With increased scrutiny on the short-term lending industry most lenders are taking measures to ensure they offer their consumers additional safeguards and protections. Smart borrowers should review these common sense issues with their lender to ensure that they are not only dealing with a trustworthy lender, but they are also getting a great rate as well. Borrowers should always remember to use cash advances responsibly and remember that cash advance fees are less expensive than returned item fees and overdraft protection charges from other financial institutions.
First, consumers should look to deal with companies who are members of the Community of Financial Services Association of America (CFSA). Companies that belong to CFSA agree to adhere to its consumer advocacy program and best practices policy. Borrowers who use a CFSA member company are given the assurance that they are dealing with a lender who is registered and licensed in the state where they operate, a lender who promises to limit the fees they charge, and provide a payment plan for consumers who find they cannot pay off their loan on the next payday. Borrowers who shop online should ask the lender if they are member of CFSA and know they are dealing with a reputable lender.
Second, borrowers should also look for the fee chart that clearly illustrates the cost associated with the cash advance loan. A typical fee for an online lender is between $17- and $30- per $100- borrowed. Borrowers should avoid cash advance lenders who charge administrative fees, loan insurance, or other add-on fees. A consumer will pay the fee or finance charge at the same time the amount borrowed is repaid. Loan terms should easy to find in a store or on a website and should be easy to understand.
Third, borrowers who need money longer than a single pay period should find out whether a lender will allow them to extend the loan longer than the initial term. Most lenders will allow borrowers to extend one to four times, but borrowers should make certain that the lender will not automatically extend their loan for them. Consumers should only deal with lenders who extend a loan when it is requested by the borrower. Some unregulated lenders will take advantage of borrowers by automatically extending a customer's loan and charging the customer an additional fee. Reputable lenders leave the choice to extend a loan in the borrower's hands.
Fourth, online borrowers should be able to call, write, or email a lender. If a lender does not post an email address, a contact telephone number, and a mailing address then the lender is probably not interested in resolving consumer concerns. Honest online lenders have different ways consumers can contact them to resolve questions and receive answers regarding the loan. Some unregulated lenders will avoid posting a telephone number or a mailing address to limit the amount of contact they have with their customers. A consumer's inability to contact a lender can lead to confusion on the part of the consumer. Reputable lenders want to discuss customer questions or concerns with their borrowers.
Lastly, borrowers should look for lenders who are well established. There are many lenders that are new to offering short-term loans. Sometimes these lenders can overlook important factors that are critical to a successful loan. Consumers should ask their lender how many years they have been around and how many loans they have serviced. If they have been established at least five or more years they are more likely to resolve any concern or question one may have because they have likely faced similar situations before. Experience in short-term lending does matter. Consumers who use established lenders are likely to have fewer problems.
Most lenders strive to satisfy their consumers' money needs. With increased scrutiny on the short-term lending industry most lenders are taking measures to ensure they offer their consumers additional safeguards and protections. Smart borrowers should review these common sense issues with their lender to ensure that they are not only dealing with a trustworthy lender, but they are also getting a great rate as well. Borrowers should always remember to use cash advances responsibly and remember that cash advance fees are less expensive than returned item fees and overdraft protection charges from other financial institutions.
Commercial Finance- The Mortgage Meltdown
by: Gregg Elberg
When the market is disrupted financial markets tend to seize up. The liquidity cycle may slow, freeze up to a degree or stop completely. This is true because banks are highly leveraged. A well capitalized bank is only required to have 6% of their assets in core capital. It is estimated that the residential mortgage meltdown will cause credit losses of about $400 billion dollars. This credit loss is about 2% of all U.S. equities. This hurts the bank's balance sheets because it impacts their 6% core capital. To compensate, banks have to charge more for loans, pay less for deposits and create higher standards for borrowers which leads to less lending.
Why did this happen? Once upon a time after the great depression of the 1930's a new national banking system was created. Banks were required to join to meet high standards of safety and soundness. The purpose was to prevent future failures of banks and to prevent another disastrous depression. Savings and Loans (which still exist but call themselves Banks today) were created primarily to lend money to people to buy houses. They took their depositor's money, lent it to people to buy homes and held these loans in their portfolio. If a homeowner failed to pay and there was a loss, the institution took the loss. The system was simple and the institutions were responsible for the building of millions of homes for over 50 years. This changed drastically with the invention of the secondary market, collateralized debt obligations which are also know as collateralized mortgage obligations.
Our government created the Government National Mortgage Association (commonly known as Ginnie Mae) and the Federal National Mortgage Association (commonly known as Fannie Mae) to purchase mortgages from banks to expand the amount of money available in the banking system to purchase homes. Then Wall Street firms created a way to expand the market exponentially by bundling up home loans in clever ways that allowed originators and Wall Street to make big profits. The big stock market firms were securitizers of mortgage-backed securities and resecuritizers who sliced and diced different parts of the groups of home loans to be bought and sold in the stock market based on prices set by the market and market analysts. Home loans, packaged as securities, are bought and sold like stocks and bonds.
In the quest to do more and more business, the standards to get a loan were lowered to a point where, at least in some cases, if a person wanted to buy a house and could assert they could pay for it they received the loan. Borrowers with weak or poor credit histories were able to get loans. There was little risk to the lender because unlike the earlier days when home loans were held in their portfolios, these loans were sold and if the loans defaulted the investors or purchasers of these loans would take the losses i.e. not the bank making the loan. The result today is tumult in our economy from the mortgage meltdown which has disrupted the overall financial system and affects all lending in a negative way.
Who is responsible for this situation? All loan originators, including banks, are responsible for turning a blind eye to loans that were based on poor credit criteria. Under the label of “subprime” loans there were low documentation loans, no documentation loans and very high loan to value loans- many of which are the foreclosures we read about on a daily basis. Wall Street is responsible for pumping this system into a financial disaster that may grow from the current $400 billion dollar estimate to over a trillion dollars. Realtors, mortgage brokers, home buyers and speculators are responsible for their willingness to pay higher and higher prices for homes on the belief that prices would only go higher and higher. This basically fueled the system for the mortgage meltdown.
Are there any similarities to the saving and loan crisis of the 1980's? Between 1986 and 1995 Savings and Loans (S&L's) lost about $153 billion. The institutions were regulated by the Federal Home Loan Bank Board and the Federal Savings and Loan Insurance Corporation. These entities passed laws that required the S&L's to make fixed rate loans only for their portfolios. The rates that could be charged for these loans were determined by the marketplace. Imagine an institution with $100 million in loans at 6% to 8%. For years the interest rates on deposits were also regulated by the government. The interest rate spread between the two allowed institutions to make a small profit.
In 1980 the U.S. Congress passed the Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA). A committee was established in Congress. Over a period of years the committee deregulated the rates S&L's could pay on savings. Nothing was changed with respect to what could be charged for home loans. Many institutions started to loose huge amounts of money because they had to pay market rates of 10% to 12% for their savings, yet they were stuck with their old 6% to 8% loans. Some executives in the savings and loan business referred to this committee as the damned idiots in Washington.
Many books have been written about these events. There is documented evidence of substantial wrongdoing by S&L executives who were trying to invest funds to save their institutions, sometimes for personal gains. Some were sophisticated criminals. Congress recognized their mistake in 1982 when the Garn-St.Germain Depositary Institutions Act was passed to allow S&Ls to diversify their activities to increase their profits. It also allowed S&L's to make variable rate loans. It was too little too late. After bankrupt institutions were liquidated by the government, the surviving S&Ls were assessed billions of dollars by the Federal Deposit Insurance Corporation to replenish the fund that insures the depositors of all U.S. banking institutions.
The mortgage meltdown and the savings and loan crises are similar with regard to the presence of greed and criminal activity. They are very different with respect to the fact that the S&L crises originated from a broken government mandated regulatory system and the mortgage meltdown has been caused primarily by a system that went wild with greed.
This has impacted non-bank lenders such as private commercial finance companies that provide hard money real estate loans, purchase order financing and accounts receivable financing. Most of these firms have raised their prices and their origination standards for safety and soundness of operations.
The bottom line: Bank lending can be replaced by other sources such as commercial finance companies to some degree. Hard money, purchase order financing and accounts receivable financing will help some businesses grow during these difficult times. But for the average borrower, businessman, or business owner these are difficult economic times, caused by the mortgage meltdown, which are here to stay for several years.
When the market is disrupted financial markets tend to seize up. The liquidity cycle may slow, freeze up to a degree or stop completely. This is true because banks are highly leveraged. A well capitalized bank is only required to have 6% of their assets in core capital. It is estimated that the residential mortgage meltdown will cause credit losses of about $400 billion dollars. This credit loss is about 2% of all U.S. equities. This hurts the bank's balance sheets because it impacts their 6% core capital. To compensate, banks have to charge more for loans, pay less for deposits and create higher standards for borrowers which leads to less lending.
Why did this happen? Once upon a time after the great depression of the 1930's a new national banking system was created. Banks were required to join to meet high standards of safety and soundness. The purpose was to prevent future failures of banks and to prevent another disastrous depression. Savings and Loans (which still exist but call themselves Banks today) were created primarily to lend money to people to buy houses. They took their depositor's money, lent it to people to buy homes and held these loans in their portfolio. If a homeowner failed to pay and there was a loss, the institution took the loss. The system was simple and the institutions were responsible for the building of millions of homes for over 50 years. This changed drastically with the invention of the secondary market, collateralized debt obligations which are also know as collateralized mortgage obligations.
Our government created the Government National Mortgage Association (commonly known as Ginnie Mae) and the Federal National Mortgage Association (commonly known as Fannie Mae) to purchase mortgages from banks to expand the amount of money available in the banking system to purchase homes. Then Wall Street firms created a way to expand the market exponentially by bundling up home loans in clever ways that allowed originators and Wall Street to make big profits. The big stock market firms were securitizers of mortgage-backed securities and resecuritizers who sliced and diced different parts of the groups of home loans to be bought and sold in the stock market based on prices set by the market and market analysts. Home loans, packaged as securities, are bought and sold like stocks and bonds.
In the quest to do more and more business, the standards to get a loan were lowered to a point where, at least in some cases, if a person wanted to buy a house and could assert they could pay for it they received the loan. Borrowers with weak or poor credit histories were able to get loans. There was little risk to the lender because unlike the earlier days when home loans were held in their portfolios, these loans were sold and if the loans defaulted the investors or purchasers of these loans would take the losses i.e. not the bank making the loan. The result today is tumult in our economy from the mortgage meltdown which has disrupted the overall financial system and affects all lending in a negative way.
Who is responsible for this situation? All loan originators, including banks, are responsible for turning a blind eye to loans that were based on poor credit criteria. Under the label of “subprime” loans there were low documentation loans, no documentation loans and very high loan to value loans- many of which are the foreclosures we read about on a daily basis. Wall Street is responsible for pumping this system into a financial disaster that may grow from the current $400 billion dollar estimate to over a trillion dollars. Realtors, mortgage brokers, home buyers and speculators are responsible for their willingness to pay higher and higher prices for homes on the belief that prices would only go higher and higher. This basically fueled the system for the mortgage meltdown.
Are there any similarities to the saving and loan crisis of the 1980's? Between 1986 and 1995 Savings and Loans (S&L's) lost about $153 billion. The institutions were regulated by the Federal Home Loan Bank Board and the Federal Savings and Loan Insurance Corporation. These entities passed laws that required the S&L's to make fixed rate loans only for their portfolios. The rates that could be charged for these loans were determined by the marketplace. Imagine an institution with $100 million in loans at 6% to 8%. For years the interest rates on deposits were also regulated by the government. The interest rate spread between the two allowed institutions to make a small profit.
In 1980 the U.S. Congress passed the Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA). A committee was established in Congress. Over a period of years the committee deregulated the rates S&L's could pay on savings. Nothing was changed with respect to what could be charged for home loans. Many institutions started to loose huge amounts of money because they had to pay market rates of 10% to 12% for their savings, yet they were stuck with their old 6% to 8% loans. Some executives in the savings and loan business referred to this committee as the damned idiots in Washington.
Many books have been written about these events. There is documented evidence of substantial wrongdoing by S&L executives who were trying to invest funds to save their institutions, sometimes for personal gains. Some were sophisticated criminals. Congress recognized their mistake in 1982 when the Garn-St.Germain Depositary Institutions Act was passed to allow S&Ls to diversify their activities to increase their profits. It also allowed S&L's to make variable rate loans. It was too little too late. After bankrupt institutions were liquidated by the government, the surviving S&Ls were assessed billions of dollars by the Federal Deposit Insurance Corporation to replenish the fund that insures the depositors of all U.S. banking institutions.
The mortgage meltdown and the savings and loan crises are similar with regard to the presence of greed and criminal activity. They are very different with respect to the fact that the S&L crises originated from a broken government mandated regulatory system and the mortgage meltdown has been caused primarily by a system that went wild with greed.
This has impacted non-bank lenders such as private commercial finance companies that provide hard money real estate loans, purchase order financing and accounts receivable financing. Most of these firms have raised their prices and their origination standards for safety and soundness of operations.
The bottom line: Bank lending can be replaced by other sources such as commercial finance companies to some degree. Hard money, purchase order financing and accounts receivable financing will help some businesses grow during these difficult times. But for the average borrower, businessman, or business owner these are difficult economic times, caused by the mortgage meltdown, which are here to stay for several years.
Moreover, there are always delivery charges and if the piece of furniture is big enough not to fit through the door, you will need some guys to intro
by: Amanda Hash
Have you ever wondered why “small writing” is small? Some may argue that it does not affect the essence of the contract. Others may “accuse” the lending party of making it smaller so that YOU give it less importance and will not care to read it. Whatever the reason, small writing is WRITING, and writing was made to be READ. So get your glasses on and read it.
Never Heard Of
I have never heard of loan agents actually asking the borrower to read the small writing… Honestly, I would not venture a reason. However, the fine tuning of the loan or contract is in the small writing. So read it thoroughly and decide whether you accept those conditions or not.
Most small writing clauses are all the same, obtained from a template provided by the organisation that regulates the trade, so it can not be taken as a direct intention of the lenders to fool you. They're mostly protecting their business, since there are more laws that protect customers than there are to protect the lenders from “wise loan takers”.
The Real Essence
The real essence of the operation is business. If you're simply buying a car for pleasure, you are making business. Any transaction is business. The profit of buying a car is the satisfaction you get from using it.
The Other Way Around
Remember the saying about considering the glass half empty or half full? Well, it is the same case here. You need their cash, it is true… but they need the interest you pay, otherwise the will be out of business in no time. Lost of investors and lending agencies have tons of cash, but either it is not theirs, or they HAVE to put it to work, or they will end up consuming it and eventually go broke.
So Then?
Read everything and decide upon it. Do not let anybody hurry you. Find out the little things you can use to negotiate a better deal. Remember that a well-used loan can mean much more to you than it does to any lender. The lump sum you get can leverage big business. Even if it is a small loan, the proportional business it can give you is big, compared to your present condition.
Conclusion
When cataloguing lenders, rather than considering them good or bad ones, there are just “convenient” or “not convenient” ones for your situation. Stop thinking that they are trying to fool you. It puts you in a defensive situation and makes you feel weak. You are the customer and the lenders, dealers, brokers or whatever you wish to call them, need YOU.
Have you ever wondered why “small writing” is small? Some may argue that it does not affect the essence of the contract. Others may “accuse” the lending party of making it smaller so that YOU give it less importance and will not care to read it. Whatever the reason, small writing is WRITING, and writing was made to be READ. So get your glasses on and read it.
Never Heard Of
I have never heard of loan agents actually asking the borrower to read the small writing… Honestly, I would not venture a reason. However, the fine tuning of the loan or contract is in the small writing. So read it thoroughly and decide whether you accept those conditions or not.
Most small writing clauses are all the same, obtained from a template provided by the organisation that regulates the trade, so it can not be taken as a direct intention of the lenders to fool you. They're mostly protecting their business, since there are more laws that protect customers than there are to protect the lenders from “wise loan takers”.
The Real Essence
The real essence of the operation is business. If you're simply buying a car for pleasure, you are making business. Any transaction is business. The profit of buying a car is the satisfaction you get from using it.
The Other Way Around
Remember the saying about considering the glass half empty or half full? Well, it is the same case here. You need their cash, it is true… but they need the interest you pay, otherwise the will be out of business in no time. Lost of investors and lending agencies have tons of cash, but either it is not theirs, or they HAVE to put it to work, or they will end up consuming it and eventually go broke.
So Then?
Read everything and decide upon it. Do not let anybody hurry you. Find out the little things you can use to negotiate a better deal. Remember that a well-used loan can mean much more to you than it does to any lender. The lump sum you get can leverage big business. Even if it is a small loan, the proportional business it can give you is big, compared to your present condition.
Conclusion
When cataloguing lenders, rather than considering them good or bad ones, there are just “convenient” or “not convenient” ones for your situation. Stop thinking that they are trying to fool you. It puts you in a defensive situation and makes you feel weak. You are the customer and the lenders, dealers, brokers or whatever you wish to call them, need YOU.
Refurnish Your Home With A Personal Loan
by: Amanda Hash
Moreover, there are always delivery charges and if the piece of furniture is big enough not to fit through the door, you will need some guys to introduce it through windows or dismantle it and put it together again. All of this costs a lot of money and you need to add it to the overall costs of the refurnish project.
Why Personal Loans?
There are many reasons why a personal loan is the best choice for you. For starters, since personal loans come in fixed amounts, this will force you to budget your finance needs and know beforehand how much money it will cost you to refurnish your home. Thus, you will avoid going on board a project that you are not sure how much it will cost.
Secondly, the interest rate charged for personal loans is a lot higher that the rate charged for credit card financing. Even unsecured personal loans carry lower rates than credit cards. If you are lucky enough to have equity on your home, you can request a home equity loan and you will be able to get finance at a much lower rate.
Finally, fixed payments will help you budget your debt repayment and thus divide among the months a project that might be quite expensive. With credit cards, when you make big purchases, the minimum balance payment tends to escalate to high amounts that may not be easily afforded.
Different Types of Loans
Personal loans come in many forms. There are secured and unsecured personal loans, fixed rate and variable rate personal loans, personal loans for people with bad credit, pre-approved personal loans, pre-qualified personal loans, etc. All share the same concept: They are loans meant for personal purposes that may carry high amounts but never as high as home loans.
The presence or absence of collateral determines whether a personal loan is secured or unsecured. Collateral is a security (an asset) that guarantees repayment of the loan thus reducing the risk involved in the financial transaction for the lender. That's the reason why secured personal loans carry such low interest rates compared with unsecured personal loans.
As regards the interest rate, a fixed rate remains the same over the whole life of the loan. This implies that the monthly payments of the loan will also remain the same which makes them an excellent tool for those not familiar with the lending market and not familiar with budgeting variable rate debts.
Variable rate personal loans change the interest rate every three months. The interest rate can rise, lower or stay the same according to market conditions. Thus, the monthly payments will vary consequently. However, at the same time, variable interest rates are initially lower than fixed rates (mainly because the risk for the lender is also reduced by the possibility to alter the interest rate).
Moreover, there are always delivery charges and if the piece of furniture is big enough not to fit through the door, you will need some guys to introduce it through windows or dismantle it and put it together again. All of this costs a lot of money and you need to add it to the overall costs of the refurnish project.
Why Personal Loans?
There are many reasons why a personal loan is the best choice for you. For starters, since personal loans come in fixed amounts, this will force you to budget your finance needs and know beforehand how much money it will cost you to refurnish your home. Thus, you will avoid going on board a project that you are not sure how much it will cost.
Secondly, the interest rate charged for personal loans is a lot higher that the rate charged for credit card financing. Even unsecured personal loans carry lower rates than credit cards. If you are lucky enough to have equity on your home, you can request a home equity loan and you will be able to get finance at a much lower rate.
Finally, fixed payments will help you budget your debt repayment and thus divide among the months a project that might be quite expensive. With credit cards, when you make big purchases, the minimum balance payment tends to escalate to high amounts that may not be easily afforded.
Different Types of Loans
Personal loans come in many forms. There are secured and unsecured personal loans, fixed rate and variable rate personal loans, personal loans for people with bad credit, pre-approved personal loans, pre-qualified personal loans, etc. All share the same concept: They are loans meant for personal purposes that may carry high amounts but never as high as home loans.
The presence or absence of collateral determines whether a personal loan is secured or unsecured. Collateral is a security (an asset) that guarantees repayment of the loan thus reducing the risk involved in the financial transaction for the lender. That's the reason why secured personal loans carry such low interest rates compared with unsecured personal loans.
As regards the interest rate, a fixed rate remains the same over the whole life of the loan. This implies that the monthly payments of the loan will also remain the same which makes them an excellent tool for those not familiar with the lending market and not familiar with budgeting variable rate debts.
Variable rate personal loans change the interest rate every three months. The interest rate can rise, lower or stay the same according to market conditions. Thus, the monthly payments will vary consequently. However, at the same time, variable interest rates are initially lower than fixed rates (mainly because the risk for the lender is also reduced by the possibility to alter the interest rate).
Bad Credit, Good Prospects
by: Amanda Hash
There are two cases of bad credit. Your recent history, that is, when you still owe the money and your “ancient” history, when it is old information which has not been updated, although the debts no longer exist.
Why Do We Make This Difference?
Well, the great difference is that, while in the first case you have one point in favor, asking for the loan to pay off the debt, in the second case, you may be declaring that you want to buy a car or maybe you are applying for a personal loan without having to give the destination of the money.
In one case, you are exchanging several monthly payments for only one. In the other case, you are adding still one payment more. You know that it is not so, but the lender does not. This is where the credit repair comes in. You have to update the status of your report and establish a new history soon.
Some Recommendations
The first one, ask for small loans and for short terms, so you can have several entries in the report, all registering good compliance. When your rating has increased considerably, then you can ask for a greater amount.
Another
Always use the same name, when applying for a credit. It may sound funny, but if your name is John Edmund Majors and at home they call you Jack or Jock, do not use them. So, always use your middle name too, so that will avoid mistaking you for someone called John Fitzpatrick Majors, who has not used his middle name either.
And Where Are The Good Prospects?
The good prospects lie in the fact that you are finally aware of what affects your credit both ways, good and bad, you are correcting the bad entries, both true and mistaken, you are learning how to influence the bureaus in a favorable way and even so, you are getting the loan you want.
Some Loans Do Not Need…
Some loans do not require a security. These are unsecured loans and are granted against your signature alone. They are based on the most recent credit report and your stable job. On the other hand, if a security should be required, you can use property or a car to back the loan.
Depending On Your Needs
You will be able to use the car you're buying, to back your auto-loan or the property you are buying in the case of a mortgage or a home equity loan. Other, smaller amounts can use property as collateral, but it may not be worth while to put your home at risk just for a few bucks.
There are two cases of bad credit. Your recent history, that is, when you still owe the money and your “ancient” history, when it is old information which has not been updated, although the debts no longer exist.
Why Do We Make This Difference?
Well, the great difference is that, while in the first case you have one point in favor, asking for the loan to pay off the debt, in the second case, you may be declaring that you want to buy a car or maybe you are applying for a personal loan without having to give the destination of the money.
In one case, you are exchanging several monthly payments for only one. In the other case, you are adding still one payment more. You know that it is not so, but the lender does not. This is where the credit repair comes in. You have to update the status of your report and establish a new history soon.
Some Recommendations
The first one, ask for small loans and for short terms, so you can have several entries in the report, all registering good compliance. When your rating has increased considerably, then you can ask for a greater amount.
Another
Always use the same name, when applying for a credit. It may sound funny, but if your name is John Edmund Majors and at home they call you Jack or Jock, do not use them. So, always use your middle name too, so that will avoid mistaking you for someone called John Fitzpatrick Majors, who has not used his middle name either.
And Where Are The Good Prospects?
The good prospects lie in the fact that you are finally aware of what affects your credit both ways, good and bad, you are correcting the bad entries, both true and mistaken, you are learning how to influence the bureaus in a favorable way and even so, you are getting the loan you want.
Some Loans Do Not Need…
Some loans do not require a security. These are unsecured loans and are granted against your signature alone. They are based on the most recent credit report and your stable job. On the other hand, if a security should be required, you can use property or a car to back the loan.
Depending On Your Needs
You will be able to use the car you're buying, to back your auto-loan or the property you are buying in the case of a mortgage or a home equity loan. Other, smaller amounts can use property as collateral, but it may not be worth while to put your home at risk just for a few bucks.
Refinancing Your Motorcycle Loan Made Easy
by: Amanda Hash
Depending on your credit and financial situation, you may get cheaper or more expensive finance sources. Whichever your situation is, however, you do not need to despair since there is always a refinance solution for you, even if you have to resort to different means than traditional refinance loans.
Secured or Unsecured Loans
Depending on the value of the motorcycle you could get a personal unsecured loan to refinance your current loan or a secured refinance motorcycle loan. Inexpensive motorcycle loans can be refinanced with simple personal unsecured loan. You just request an unsecured loan and repay your current motorcycle loan so you only have to face the new payments.
If the motorcycle is more expensive you probably can request a motorcycle or motor vehicle refinance loan with the same company of your current loan or with another one. In any case, your current loan will be replaced with the new one that will also be secured with the motorcycle.
Homeowner? Home Equity Loans!
For those who are homeowners, there is an excellent alternative that consists on requesting a home equity loan and use the money to repay the current motorcycle loan. After doing so, you will only have to pay the home equity loan's monthly payments that will be significantly smaller than that of the motorcycle loan.
Home equity loans carry considerably lower interest rates and come with longer repayment schedules too. Thus, the amount of the monthly installments can be greatly reduced by using these means to refinance your motorcycle loan. You can also save thousands of dollars, request larger amounts and use the surplus for other purposes.
Bad Credit? Bad Credit Loans are Available!
Bad credit loans are also available for refinancing motorcycle loans. If you are a homeowner, getting a bad credit home equity loan will be the easier and cheapest solution since qualification is really trouble-free. However, there are also bad credit personal loans for refinancing motorcycle loans and other vehicle loans that can be obtained with bad credit, no credit at all or even bankruptcy.
You may have to face higher interest rates due to the higher risk involved for the lender in the financial transaction, but the monthly payments can be reduced by refinancing for longer term loans. The main requirement that you will have to meet is having a steady income with which you must be able to afford the new monthly payments.
If you wonder where you can apply for these types of loans, there are many lenders (both traditional and non traditional) that are offering these and other kinds of loans both online and offline. However, the best place to start your search for the right lender is the net since you can request online quotes and compare what the different lenders have to offer.
Depending on your credit and financial situation, you may get cheaper or more expensive finance sources. Whichever your situation is, however, you do not need to despair since there is always a refinance solution for you, even if you have to resort to different means than traditional refinance loans.
Secured or Unsecured Loans
Depending on the value of the motorcycle you could get a personal unsecured loan to refinance your current loan or a secured refinance motorcycle loan. Inexpensive motorcycle loans can be refinanced with simple personal unsecured loan. You just request an unsecured loan and repay your current motorcycle loan so you only have to face the new payments.
If the motorcycle is more expensive you probably can request a motorcycle or motor vehicle refinance loan with the same company of your current loan or with another one. In any case, your current loan will be replaced with the new one that will also be secured with the motorcycle.
Homeowner? Home Equity Loans!
For those who are homeowners, there is an excellent alternative that consists on requesting a home equity loan and use the money to repay the current motorcycle loan. After doing so, you will only have to pay the home equity loan's monthly payments that will be significantly smaller than that of the motorcycle loan.
Home equity loans carry considerably lower interest rates and come with longer repayment schedules too. Thus, the amount of the monthly installments can be greatly reduced by using these means to refinance your motorcycle loan. You can also save thousands of dollars, request larger amounts and use the surplus for other purposes.
Bad Credit? Bad Credit Loans are Available!
Bad credit loans are also available for refinancing motorcycle loans. If you are a homeowner, getting a bad credit home equity loan will be the easier and cheapest solution since qualification is really trouble-free. However, there are also bad credit personal loans for refinancing motorcycle loans and other vehicle loans that can be obtained with bad credit, no credit at all or even bankruptcy.
You may have to face higher interest rates due to the higher risk involved for the lender in the financial transaction, but the monthly payments can be reduced by refinancing for longer term loans. The main requirement that you will have to meet is having a steady income with which you must be able to afford the new monthly payments.
If you wonder where you can apply for these types of loans, there are many lenders (both traditional and non traditional) that are offering these and other kinds of loans both online and offline. However, the best place to start your search for the right lender is the net since you can request online quotes and compare what the different lenders have to offer.
Protect Your Home From Aging, Weather And Kids
by: Amanda Hash
It increases the value of your home and if you can add a room or garage to it, all the better. So, considering the cost of home repair, lenders have produced this type of loan, backed by the equity of the house and for a determined purpose.
The Result
The result is a Home Improvement Loan, with a longer payback term than a personal loan, shorter than a mortgage and with even less risk than a mortgage, since the home is acquiring more value through the repairs or improvement. As a consequence, we have a convenient loan to enlarge our assets.
The Seeds Of A Good Deal
When you set out to get a good deal on a loan, do not just think about the monthly payment. There is much more than that to a loan. There are three basic parameters: The length of the term, the amount drawn and the APR (Annual Percentage Rate). Shopping around will let you have a good idea of what to expect.
Next come the expenses. Administrative costs, the loan fee, an appraisal of the property and the investigation of existing mortgages. All this adds up to your eligibility to get a loan with the best possible conditions. Note that if there is a fairly recent mortgage, there will not be enough equity to back up the new loan.
The Prize Of Sleeping On Safe Finances
Yes, it is the prize you get for having done your homework and acting responsibly. One of the things that will give you a good image is a proper plan and detail of the improvements you will carry out. Get at least three quotes on the materials you need, as well as those for the labor involved.
Being An Organized Borrower
The quotes are not the only things that make a good impression on the lender. When you are talking over the conditions, ask some well-prepared questions on what extra expenses there are, whether you can skip any payment and other things of the sort.
Last But Not Least
Something absolutely priceless is being a responsible borrower. That means, from your side of the counter, to be aware of the stumbling blocks that might make you have trouble paying for the loan every month. Make a list of worst case scenario bugs. Think up a way to solve those in advance or at least an emergency plan.
Unexpected medical bills, a thunderbolt burning out your fridge, TV and other appliances, whatever you can think up, you know better than I do. It is always better to be one step ahead of circumstances so that you have a happy ending to your loan.
It increases the value of your home and if you can add a room or garage to it, all the better. So, considering the cost of home repair, lenders have produced this type of loan, backed by the equity of the house and for a determined purpose.
The Result
The result is a Home Improvement Loan, with a longer payback term than a personal loan, shorter than a mortgage and with even less risk than a mortgage, since the home is acquiring more value through the repairs or improvement. As a consequence, we have a convenient loan to enlarge our assets.
The Seeds Of A Good Deal
When you set out to get a good deal on a loan, do not just think about the monthly payment. There is much more than that to a loan. There are three basic parameters: The length of the term, the amount drawn and the APR (Annual Percentage Rate). Shopping around will let you have a good idea of what to expect.
Next come the expenses. Administrative costs, the loan fee, an appraisal of the property and the investigation of existing mortgages. All this adds up to your eligibility to get a loan with the best possible conditions. Note that if there is a fairly recent mortgage, there will not be enough equity to back up the new loan.
The Prize Of Sleeping On Safe Finances
Yes, it is the prize you get for having done your homework and acting responsibly. One of the things that will give you a good image is a proper plan and detail of the improvements you will carry out. Get at least three quotes on the materials you need, as well as those for the labor involved.
Being An Organized Borrower
The quotes are not the only things that make a good impression on the lender. When you are talking over the conditions, ask some well-prepared questions on what extra expenses there are, whether you can skip any payment and other things of the sort.
Last But Not Least
Something absolutely priceless is being a responsible borrower. That means, from your side of the counter, to be aware of the stumbling blocks that might make you have trouble paying for the loan every month. Make a list of worst case scenario bugs. Think up a way to solve those in advance or at least an emergency plan.
Unexpected medical bills, a thunderbolt burning out your fridge, TV and other appliances, whatever you can think up, you know better than I do. It is always better to be one step ahead of circumstances so that you have a happy ending to your loan.
Getting Ready for a Business Loan Application
by: Devora Witts
All the documentation that is prepared by you needs to be printed with the same typography and in the same paper unless you need to fill pre-printed forms. If possible try to include all documentation in the same paper size. Especially when appending photocopies, you should avoid unclear prints or stained ones.
This may sound irrelevant to you, but tidiness and organization speaks of you and your business. It tells the lender that chances are that you are well organized and tidy at managing as you are at preparing documentation.
Always Resort To Professional Accountants
Let your figures be prepared by professionals, they know exactly what the bank is looking for and will present those numbers in the best possible way. You will also avoid making unintentional mistakes that may result in your loan application to be declined due to inaccuracies.
Review, Review, Review
There are never enough reviews; you need to check that there are no mistakes in your statements as many times as possible. Experience shows that even statements prepared by the most skilled professionals cease to have errors and typos after the third review with any luck.
Watch The Dates
Be specially careful when you date your statements, numbers and statistics. Any inaccuracy on this particular detail can result in serious misinterpretation of the information by the bank or financial institution that can lead to a decline on your application.
Be Conservative
Even if you are confident on the future performance of the company, keep your projections in reasonable ranges. Being conservative tells the lender that you are a reliable person that foresees the possibility of future difficulties and is prepared to face them by not pushing the budget too far.
Reliability is an essential quality any lender looks for in a borrower, if you show you are not cautious about your projections, they will tend to think that you will make unnecessary expenses jeopardizing the company's performance by venturing into uncertain businesses.
You need to remember that the lender is worried about recovering the money he has lent and thus, he needs you to show him you will be able to repay the loan by guaranteeing at least with your watchful behavior that the company will keep expenses under control.
This does not mean that you do not have to show ambition, on the contrary, you need to show that even though you are ambitious, you always make sure you risk the least possible while at the same time trying to maximize the profits. Make the lender feel comfortable with his decision of lending you the money you need for your business, show him that there is a minimum or no risk and that you will be able to repay the loan without hassles.
All the documentation that is prepared by you needs to be printed with the same typography and in the same paper unless you need to fill pre-printed forms. If possible try to include all documentation in the same paper size. Especially when appending photocopies, you should avoid unclear prints or stained ones.
This may sound irrelevant to you, but tidiness and organization speaks of you and your business. It tells the lender that chances are that you are well organized and tidy at managing as you are at preparing documentation.
Always Resort To Professional Accountants
Let your figures be prepared by professionals, they know exactly what the bank is looking for and will present those numbers in the best possible way. You will also avoid making unintentional mistakes that may result in your loan application to be declined due to inaccuracies.
Review, Review, Review
There are never enough reviews; you need to check that there are no mistakes in your statements as many times as possible. Experience shows that even statements prepared by the most skilled professionals cease to have errors and typos after the third review with any luck.
Watch The Dates
Be specially careful when you date your statements, numbers and statistics. Any inaccuracy on this particular detail can result in serious misinterpretation of the information by the bank or financial institution that can lead to a decline on your application.
Be Conservative
Even if you are confident on the future performance of the company, keep your projections in reasonable ranges. Being conservative tells the lender that you are a reliable person that foresees the possibility of future difficulties and is prepared to face them by not pushing the budget too far.
Reliability is an essential quality any lender looks for in a borrower, if you show you are not cautious about your projections, they will tend to think that you will make unnecessary expenses jeopardizing the company's performance by venturing into uncertain businesses.
You need to remember that the lender is worried about recovering the money he has lent and thus, he needs you to show him you will be able to repay the loan by guaranteeing at least with your watchful behavior that the company will keep expenses under control.
This does not mean that you do not have to show ambition, on the contrary, you need to show that even though you are ambitious, you always make sure you risk the least possible while at the same time trying to maximize the profits. Make the lender feel comfortable with his decision of lending you the money you need for your business, show him that there is a minimum or no risk and that you will be able to repay the loan without hassles.
Are Unsecured Loans Really Better
by: Devora Witts
Any Purpose?
When financial institutions want to promote unsecured loans, they usually claim that you can use an unsecured loan for any purpose. The truth is that there are secured loans that can also be used for any purpose. A home equity loan does not have a specific use and the money you get can be used for whatever you want. Thus, the “any purpose” benefit does not seem to be such an advantage.
No Collateral
The other common claim is that since unsecured loans do not require collateral, the risk of repossession does not exist. This is actually true but what they forget to state is that the lender is still entitled to take legal actions to recover what he has lent. Collateral is only a guarantee, it gives the lender several rights over the asset in case there are more creditors willing to recover their money. All the other debtor's assets will be sold before in order to pay other debts.
Loan Amounts
It is a common belief that one can borrow more money with a secured loan than with an unsecured loan. This is only true in some cases. With a secured loan, one can borrow as much money as the asset's value can guarantee. However if someone has a good credit score and many assets, all of this would be “guaranteeing” any loan he might request and thus, he can get a higher amount by applying for an unsecured loan. This is especially true when it comes to unsecured business loans.
All the above is also applicable to loan's length. Loan lenght is also determined by the risk involved for the lender and someone with many assets and good credit, even if he does not offer an asset as collateral, is a low risk prospect.
Tenants And Non-Homeowners
As stated at the beginning of this article, unsecured loans are sometimes the only choice some people have in order to get finance. Tenants and Non-homeowners can not offer an asset as collateral and thus, have no other choice but to apply for an unsecured loan.
Due to the highly competitive nature of the unsecured loan market, the interest rate charged for unsecured loans has been decreasing over the years and at the present time unsecured loans' interest rate does not differ much from secured loans' rate. So, it is not strange that many homeowners are opting for unsecured loans and holding back to their properties in case they need to request a secured loan in an emergency situation.
Any Purpose?
When financial institutions want to promote unsecured loans, they usually claim that you can use an unsecured loan for any purpose. The truth is that there are secured loans that can also be used for any purpose. A home equity loan does not have a specific use and the money you get can be used for whatever you want. Thus, the “any purpose” benefit does not seem to be such an advantage.
No Collateral
The other common claim is that since unsecured loans do not require collateral, the risk of repossession does not exist. This is actually true but what they forget to state is that the lender is still entitled to take legal actions to recover what he has lent. Collateral is only a guarantee, it gives the lender several rights over the asset in case there are more creditors willing to recover their money. All the other debtor's assets will be sold before in order to pay other debts.
Loan Amounts
It is a common belief that one can borrow more money with a secured loan than with an unsecured loan. This is only true in some cases. With a secured loan, one can borrow as much money as the asset's value can guarantee. However if someone has a good credit score and many assets, all of this would be “guaranteeing” any loan he might request and thus, he can get a higher amount by applying for an unsecured loan. This is especially true when it comes to unsecured business loans.
All the above is also applicable to loan's length. Loan lenght is also determined by the risk involved for the lender and someone with many assets and good credit, even if he does not offer an asset as collateral, is a low risk prospect.
Tenants And Non-Homeowners
As stated at the beginning of this article, unsecured loans are sometimes the only choice some people have in order to get finance. Tenants and Non-homeowners can not offer an asset as collateral and thus, have no other choice but to apply for an unsecured loan.
Due to the highly competitive nature of the unsecured loan market, the interest rate charged for unsecured loans has been decreasing over the years and at the present time unsecured loans' interest rate does not differ much from secured loans' rate. So, it is not strange that many homeowners are opting for unsecured loans and holding back to their properties in case they need to request a secured loan in an emergency situation.
With A Diploma At Hand, It's Time To Give The Cash Back
by: Devora Witts
Ok so you are out of school. No more 2 ton backpacks, deadline term papers, Albert Einstein equations or all night study groups. Your 4 year education race has come to its end and now it is time to return the favor to those who helped you financially along the grades. Now it is time to visit your financial counselor and make payment arrangements to fulfill all your repayments. If you were an accounting major, this is where the real deal begins.
Once you have framed your college diploma and hung your cap and gown, your loan consultant will advice you as to when you can begin paying back your loan. Some loans like FFEL Loans or Direct Stafford Loans will begin accepting payments after the 6-9 month grace period has ended which is after graduation or in some circumstances suspension of enrollment. Your school financial counselor will assist you by informing you the date you need to start signing off payback checks. It is important to acquire loan payback information from the beginning because it will help you organize your repayment plans. Some loans offer a repayment plan of up to 10 years. The amount of indemnity will vary greatly depending on the estimated schedule you have arranged with the loan provider and the total amount you have borrowed throughout your enlistment.
Shortcoming Payments Can Affect Your Homecoming Memories
Education loans are as genuine as your college degree and must be handled with the same importance. Just like mortgages or credit card payments, failure to make loan payments can hurt more than that F in Chemistry. If you are undergoing economic difficulties and know off hand that you will need additional time to begin payments on your school loans, it is critical that you inform your financial counselor or your loan provider of this situation. Avoid misunderstandings and unnecessary action taken against your account. This will annul all possibilities of being charged an overdue remuneration.
Payment Lapse
The consequences of failing to make payments as you once had agreed to when you originally signed the school loan can be crucial. Not only can the school you attended, the loan provider who assisted you and the Federal Government attack legally in order to recuperate the amount you failed to return, your future credit can also be jeopardized. You can forget about asking for more loans to cover your future career path and tax refunds will not be awarded.
Do Not Sweat It, Act!
Should this misfortune occur, it is important to become aware and reprehend this from advancing. Default borrowers have two possibilities to modify their overdue loan account. A deferment is a temporary suspension of repayment and can de granted if insufficient income or an economic struggle is determined. The payment of interest accumulated on the loan during the period of deferment varies from loan to loan. Some subsidized loans do not require the interest to be paid during this period, while others do. However, if the interest is not paid then it will be added to the original loan amount making future payments extremely higher. Your account will go into delinquency if payments are not received. Another form of comforting this obstacle is forbearance which is postponing payments for an indefinite period of time due to the impossibility of payment arrangements. Your loan provider can grant a payment interruption from 1-3 years. This differs from a deferment because there are no alterations in the interest accumulated on the account. The interest must be paid for at all times until the forbearance has been settled.
Do Not Let Your Payments Fall, Grab The Phone And Call
Seek a financial counselor rather than a collection agency consultant. On a final note, do not wait until the bills have piled up and you have started regretting ever going to college. Contact your school and loan source as soon as possible and avoid default. Take immediate action and contact The U.S. Department of Education National Student Loan Data System and get started repaying that loan!
Ok so you are out of school. No more 2 ton backpacks, deadline term papers, Albert Einstein equations or all night study groups. Your 4 year education race has come to its end and now it is time to return the favor to those who helped you financially along the grades. Now it is time to visit your financial counselor and make payment arrangements to fulfill all your repayments. If you were an accounting major, this is where the real deal begins.
Once you have framed your college diploma and hung your cap and gown, your loan consultant will advice you as to when you can begin paying back your loan. Some loans like FFEL Loans or Direct Stafford Loans will begin accepting payments after the 6-9 month grace period has ended which is after graduation or in some circumstances suspension of enrollment. Your school financial counselor will assist you by informing you the date you need to start signing off payback checks. It is important to acquire loan payback information from the beginning because it will help you organize your repayment plans. Some loans offer a repayment plan of up to 10 years. The amount of indemnity will vary greatly depending on the estimated schedule you have arranged with the loan provider and the total amount you have borrowed throughout your enlistment.
Shortcoming Payments Can Affect Your Homecoming Memories
Education loans are as genuine as your college degree and must be handled with the same importance. Just like mortgages or credit card payments, failure to make loan payments can hurt more than that F in Chemistry. If you are undergoing economic difficulties and know off hand that you will need additional time to begin payments on your school loans, it is critical that you inform your financial counselor or your loan provider of this situation. Avoid misunderstandings and unnecessary action taken against your account. This will annul all possibilities of being charged an overdue remuneration.
Payment Lapse
The consequences of failing to make payments as you once had agreed to when you originally signed the school loan can be crucial. Not only can the school you attended, the loan provider who assisted you and the Federal Government attack legally in order to recuperate the amount you failed to return, your future credit can also be jeopardized. You can forget about asking for more loans to cover your future career path and tax refunds will not be awarded.
Do Not Sweat It, Act!
Should this misfortune occur, it is important to become aware and reprehend this from advancing. Default borrowers have two possibilities to modify their overdue loan account. A deferment is a temporary suspension of repayment and can de granted if insufficient income or an economic struggle is determined. The payment of interest accumulated on the loan during the period of deferment varies from loan to loan. Some subsidized loans do not require the interest to be paid during this period, while others do. However, if the interest is not paid then it will be added to the original loan amount making future payments extremely higher. Your account will go into delinquency if payments are not received. Another form of comforting this obstacle is forbearance which is postponing payments for an indefinite period of time due to the impossibility of payment arrangements. Your loan provider can grant a payment interruption from 1-3 years. This differs from a deferment because there are no alterations in the interest accumulated on the account. The interest must be paid for at all times until the forbearance has been settled.
Do Not Let Your Payments Fall, Grab The Phone And Call
Seek a financial counselor rather than a collection agency consultant. On a final note, do not wait until the bills have piled up and you have started regretting ever going to college. Contact your school and loan source as soon as possible and avoid default. Take immediate action and contact The U.S. Department of Education National Student Loan Data System and get started repaying that loan!
