Posts Tagged ‘working capital’

Business Loans Versus Cash Advance

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Compared to usual small business loan financing, with the business cash advance your business is not set to payment plan. Installment payment is based primarily on daily earnings. A proportionate amount of your company’s daily revenue goes out toward repayment of the cash advance that is going to vary primarily based on your business.

Should your business all of a sudden produces exceptionally, your cash advance debt may easily be cleared rather quickly. However, on the flip side, in case you are enduring a sluggish season, your cash advance will accommodate to that because of the fact that pay back of the cash advance is based on the amount of your regular gross sales. In case that you are closed, simply no payments may possibly be withdrawn. Obviously if you have a slow period we take a smaller payment; this way payments are following flow of your business.

At the same time, unlike small business loans (hint: you may always use Liberty Capital Group’s real time quote calculator to assess your financing options), our unsecured business loan alternative doesn’t necessarily involve collateral or a personal guarantee. Also, we do not demand financial records or tax returns. Our quick pre-approved online application is hassle-free and takes only a couple of minutes to complete. Business loans require extensive paperwork and a lot of time. We can approve your business for an unsecured cash advance in less than 24 hours. Minimum advance starts at $5k and we have a cash advance and working capital loan programs of up to $500,000, so it could be used for acquiring assets like heavy duty truck or similar.

Because we do not need money upfront or contract fees from your business, capital is drafted to your bank for you to start using it just about any way you want. Regardless whether your business is seasonal or not you will benefit from this.

Better Than a Loan!

– Bad credit – not a problem.
– No Personal Guarantee.
– No fees for application or closing.
– Collateral is not required.
– Flexible – Automated Payback.
– Simply no stressful fixed repayment schedule.
– No Financials or Tax Returns Required.

As we stated, credit score is not a problem. Nevertheless, business owners with exceptionally good scores can be rewarded with specific conditions. Along the same lines, unreasonably poor scores may result in small advance approvals, higher expenses, or outright decline.

Cash Advance Benefits

  • No origination or application fees
  • Quick online application.
  • Fast business loan alternative.
  • Approved in less than 24 hours.

To talk to your personal account manager at Liberty Capital Group please call 888-798-3976.

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Enhance Your Chance Of Getting a Business Loan

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The current economic climate has had its ups and downs lately, but appears to be improving. You might want to consider expanding your business too, maybe hiring more employees. Since all your money is already invested in your company, it’s quite possible you will need to take out financing. This will turn out to be easier said than done. In this questionable, albeit recuperating financial climate, money institutions continue to be cautious to lend money to companies with less than stellar credit.

In cases when major finance institutions won’t give a loan , it could be a good time to get support via alternative financing businesses like credit unions, peer-to-peer lending and similar specialised financing institutions like Liberty Capital. With these lenders, approval is less cumbersome than with the traditional banking institutions, even while certain requirements still must be bet. Usually a simple finance application is all that is required.

Below are a couple ideas that can help enhance your chances of approval:

• Try to improve your company’s credit history. Regular finance companies weigh this pretty rigorously while considering lending money.
• Contact the Small Business Administration or some other similar and talk to a lending professional or consultant.
• Compose a strong comprehensive impressive program, demonstrating you have done your homework.
• Show plan on exactly how you intend to repay the borrowing.
• Build good relations with the financier.

Sticking with the strategies presented will increase your chances of finding a loan.

The #1 reason organizations and businesses go out of business is coming from the lack of seed money. Short-term working capital loan is best suited for small businesses foreseeing business activities that are designed to generate revenue within the loan’s term. This bridge line of credit is intended for short-term capital infusion to help increase business cash flow. Usual applications for business working capital loan include: gradual business inventory increase, purchase of business hardware or equipment, for instance used work trucks, and cash flow management. If your revenue volume fluctuates, a business working capital inflow enables you to build new business throughout the ups and downs of each business cycle. Do not take a pass on unpredicted business opportunities simply because you are short on working capital.

The main goal of Liberty Capital is to offer the lowest cost of borrowing for small businesses. Small business loan interest payment is 1/3 lower than the typical merchant cash advance. On top of that, business loan has more lengthy time period and a lot higher approval amount due to the fact it’s set on overall company gross revenue and not just on monthly credit card sales.

Therefore check Liberty Capital – the company that is a leader in providing quick loans for small to medium sized businesses.

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How To Get A Loan Through SSBCI

Posted by NReed on

When it comes to business financing, business owners have the option to apply for a business loan through the SSBCI (State Small Business Credit Initiative) which also includes a Loan Guarantee Program. This way business owners get a hold on funds required for various business needs such as inventory, business procurement or start-up costs.

Although in some cases state needs to approve the business loan terms, generally, they are negotiated between the bank and the borrower. There are also cases when the lender negotiates the terms with the state and then the loan and the guarantee are approved. There is a dedicated reserve which state puts aside to guarantee for the approved loan.

Small Business Financial Development Corps are issuing loan guarantees on behalf of the state. Before issuing a loan guarantee FDC’s will review and approve applications. The percentage of the loan which will be covered by the guarantee is negotiated between the FDC and the lender, but it is, generally, about 75%. Loan guaranteed term averages to three years and the maximum allowed is seven years.

The application for such loan will have to be supported by the following requirements:

1. A written description of the existing or proposed business.
2. CV’s of management personnel and the owners of the business.
3. Current personal financial statements are required for all principal owners (20% or more) and guarantors, together with copies of the last three years Federal Income Tax Returns. Financial statements should not be older than 60 days.
4. Written statement showing how the loan funds are to be repaid, including repayment source and time required. This written statement has to be supported by cash flow schedules, budgets, and other relevant information.
5. For a proposed business provide a pro forma balance sheet showing source and use of both equity and borrowed funds.
6. Financial data on business. For an existing business provide tax returns and financial statements for the past 3 years. A recent interim statement should also be provided.

A recent aging of accounts payable and accounts receivable should also be included as well as a schedule of term debt. Other balance sheet items of significant dollar amounts contained in the interim statement should be explained as to the nature of the item.

7. Projections of planned operations should be provided for at least 12 months on a monthly basis reflecting revenues and expenses with additional projections provided on a cash flow basis. The expectations used in preparing the projections should support the need for the funds requested and reflect the ability to repay the loan.
8. More papers are requested too. These items will often also include:

  • purchase agreements
  • purchase orders
  • franchise agreements

Due to the fact that this is a government guaranteed business loan, the borrower must submit a number of auxiliary documents authenticating the need for the loan plus supporting paperwork indicating a solid business plan and the ability to repay the loan.

Luckily, for those looking for a quick capital solutions with less paperwork, there are other funding options that don’t require so many financial statements and businesses planning which banks need to underwrite a loan. Among other business fields, we also offer business loans for used trucks. Should you have questions about obtaining financing please call the Underwriting Specialists at Liberty Capital Group, Inc. at 888-798-3976.

Small business borrowing – introduction:

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Layered Funding And Its Consequences

Posted by NReed on

When lenders approve a business loans to small business owners regardless of the existence of primary loans, this is called layered funding or piggy-back funding.

Even if it’s not through the same lender, is the lien at stake here a subordinate one? The answer is yes.

Is this a smart move for a business? There are many reasons why this is, most probably, not the best move businesses can make:

1. Cost to capital ratio is more anything but cheap. Most businesses will probably take this as the last resort.
2. Short term of no more than 6 months.
3. There are excessive punitive fees.

One hidden aspect of layered funding that is not being recognized is the fact that it jeopardizes the relationship for renewal or refinancing opportunities. A prospective lender considers this a breach of contract which could potentially cause the loan to be recalled early, not to mention, it inhibits the business’ ability to repay the initial loan, and the cash flow and debt ratio levels that a business must maintain to qualify for quality loan.

Layered funding is the worst form of bridge loan a small business owner can possible obtain for their business.

Not just that the cost of money is high, but the fees are very expensive too. This is worse than the all-pervasive Pay Day loan. There is this ploy that additional funding will help small business owners save their business, this is far from the truth as it will just jeopardize their access to future business funding.

Lenders will tend to to lend to merchants with secondary loans on the books. We don’t recommend layered funding to anyone, especially if you have a loan or business cash advance. Many businesses will not be able to survive the additional loan and consequent additional rates and fees.

Buying UCC filing lists is one of the layered funding lenders tactic. Lenders, typically, file UCC recordings with the borrower’s Secretary of State. UCC filing is becoming publicly available after lending to small businesses. Lenders and brokers buy these UCC lists from Dun & Bradstreet, Experian and others so that they know that a primary loan is in place before offering layered funding. This list can be very informative to secondary funders because they know that merchants have taken some sort of capital from other sources. Because of this information they can sell additional funding to a small business regardless to any current contract merchant might have with a bank or alternative funding source.

These lenders do not disclose full information about the potential harmful effect the layered funding might have on the businesses and they are not informing the borrowers about how other lenders will react to the layered funding of the business.

When being targeted by these layered funding brokers/lenders, one must think twice before accepting additional working capital. Will this jeopardize my current relationship with my present capital provider? Is the lenders sole benefit the only reason for this offer?

If you currently have a loan that is being deducted ACH from your account like an auto pay, and you add another layer of ACH or another auto payment deduction due to additional working capital funding, this could cause a major shortage of cash for operating expenses. This is one reason traditional lenders do not permit such funding because it can adversely affect business revenue. The fact that money obtained this way does not come cheaply, the fact that it must be paid back quickly, puts a strain on the cash flow of the business.

When all of the businesses revenue goes on financial obligations, loan payments, there will be nothing left for daily business operation. Under these circumstances you may end up closing your doors for lack of working capital or lack of capital infusion.

Should business owners take the plunge in a last ditch effort when no other funds are available? Not necessarily when the risks outweigh the benefits. For more information on how layered funding can affect your business, please contact Liberty Capital to find out how to avoid this harmful trend in business lending and get.

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