Inspirational Considerations On Small Business Financing Strategies

June 13, 2010


We’ve certainly been through some tumultuous times during these past few years. No longer can we consider ourselves to be in safe and solid occupations, as many of us have had to really focus on where we are in life, quite suddenly. For many of us, the “great recession” threw us out of our safety zone and onto the street; not too much fun when you are of “boomer” age. This type of experience can be so traumatic that it creates a lasting impression and makes you vow that you will never put yourself through this drama again. It is at times like these that you really need to consider striking out on your own and establishing your own business, rather than letting somebody else determine the fate of you and your family.

Almost all of us have an idea, deep down inside us, and we might possess some specific talent or ability that could allow us to join the ranks of the self-employed. We can take advantage of our ability to generate products or services for others, and benefit from the peace of mind that comes with entrepreneurialism. It is all very well to have a seed of an idea in your mind, but what are you to do about small business financing? A new business owner can always try going it alone with little or no up front, or ongoing expense, but realistically most businesses will need some sort of financing to get off the ground. For some this hurdle of finding small business financing could even be something they consider too difficult to overcome.

Due to all the dramas of recent years, you could be forgiven for thinking that an approach to a bank would be a complete waste of time and as a consequence most small businesses would find great difficulty in borrowing money. It certainly doesn’t have to be this way. With a solid foundation, and a bit of preparation and research, you can find small business financing options that will help you realize your dream.

You may well have heard of SBA loans and know that, even though you would need some decent credit to start off, you don’t have to have perfect scores, a situation that very many people find themselves in these days. SBA loans are available for up to $5 million in value and it’s certainly possible that you will only be required to put between 10 and 20% of your own money into the pot. This concept was created by the government and is a program that is intended to be a guarantor of loans that are made by others. 90% of qualifying loans will be underwritten by the government, under this program.

You could find the provision of a down payment an issue under any circumstances and in these cases, financing for your small business could be realized through an unsecured loan. Unsecured loans could be an option if you require less than $150,000, and are in possession of a good credit score. You won’t have to guarantee the loan against your home or other significant assets, and capital may be available to you in as little as seven days. These cases rely entirely on a first-class credit history, good credit standing and an appropriate credit utilization rate.

Did you know that there is another option available, allowing you to put all of your retirement funds into a new business venture should you wish, which saves you early distribution penalties and taxes, as well? Here, you should have more than $50,000 in retirement funds available and should seriously consider this case. In this case you would be investing in yourself, so you wouldn’t have to worry about loan payments or anything like that. In addition, it is also possible to combine this form of small business financing with other sources of funding. This is the way that you could move forward, if you’re finding it difficult to come up with the 20% equity needed to qualify for a SBA loan.

If you have to buy equipment for your new business, why not consider equipment leasing as a way to access these assets? While you may only use this money to purchase equipment or to refinance, you often find very favorable rates associated with equipment leases.

If you think that there are not enough small business financing and funding solutions for you, you might not be looking in the right place, as you seek to achieve your goals.

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Thanks so much!
Michelle

We’ve certainly been through some tumultuous times during these past few years. No longer can we consider ourselves to be in safe and solid occupations, as many of us have had to really focus on where we are in life, quite suddenly. For many of us, the “great recession” threw us out of our safety [...]

Posted by Guest Post | Filed Under **Business** 

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