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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Critical Tips On Gaining Control Of Your Retirement Investments

June 12, 2010

You should consider a self directed IRA LLC if you want complete flexibility when you’re looking at your retirement options. You can make all the decisions associated with your investments and retirement plan yourself when thinking about this form of individual retirement account, commonly known as the IRA. Many people look at this as an exciting and potentially very beneficial way to control their own retirement accounts. These options are so flexible that they can be used for numerous potential investment opportunities, including but not limited to small business ventures, franchises, mortgages, tax liens, private equity, partnerships or real estate purchases both home and abroad. The self-directed IRA offers you an almost unlimited range of solutions, creatively.

If you have a Roth IRA, traditional IRA, 401(k), 403 (b) or other plan, so long as it is a qualified retirement account it can be rolled into a self-directed IRA. The funding from these introduced accounts is injected into the new plan and then shares are purchased in a custom made limited liability company, LLC. This is a legal and established process that allows you to assume control over your retirement account investments, with no early distribution taxes, transaction fees or other restrictions.

If you engage in this type of creative formatting, the potentially punitive asset-based and transactional fees that are associated with self directed IRA custodians can be avoided, and this can add up to hundreds or thousands of dollars in a given year. Not only that, but you will also be better positioned to take advantage of time-sensitive investment opportunities, such as foreclosure auctions. With a self-directed IRA LLC, you don’t have to deal with the complex and time-consuming restrictions associated with gaining custodial approval.

Normally, a custodian must be appointed to oversee all IRA matters. If a rental property is involved, as an example, rent checks must be forwarded to the IRA custodian on a monthly basis. If any repairs are needed you would first need to gain approval from the custodian, and so on. Each time the custodian gets involved, you can be sure that you will be paying transaction fees. When a self-directed IRA is developed using an LLC structure, the custodian merely invests funds into the LLC one time. The LLC manager (you) then takes care of all the day-to-day needs of the account. You can collect and deposit the rent checks, arrange for repairs to the property, and write a check for related expenses on-the-spot. With a self-directed IRA LLC, you are not held hostage — you are in control.

Earlier it was pointed out that there was an almost unlimited array of investment options available to you through a self directed IRA LLC. It’s important to point out the restrictions, however. According to the Internal Revenue Service, IRS, there are only two areas that you cannot deal with when involved with self-directed IRA accounts, including collectibles and life insurance. Collectibles includes items such as jewelry or works of art. But this category can also extend to silver or gold coins, in certain instances. When coins are disqualified, they typically are valued more from their “collectible” position, rather than the actual silver or gold content, thus categorizing them as collectible.

For individuals seeking investment options with more security, and looking for life outside of the stock market, there is no better structure than a self-directed IRA LLC. It’s a great feeling when you have every day, hands-on control over your investments and the chance to build a really diversified portfolio, when using self-directed IRA programs.

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Crucial Considerations On SBA Loans For Your Small Business

June 3, 2010

Way back in 1953, the United States government felt that entrepreneurs in this country needed help to set up their businesses, and established the Small Business Administration, also known as the SBA. Essentially, the SBA guarantees qualified loans made by financial institutions, making it more attractive for them to lend money to businesses. Up to 90% of qualifying small business loans can be guaranteed under typical SBA loan programs. The most widely used category of loan, known as the 7(a) SBA loan, can be used for a wide variety of different business purposes.

The SBA has scrutinized all the banks in the country and has indicated which banks are “more business friendly,” as determined by the Administration’s Office of Advocacy. In the majority of cases the lender will talk to the SBA if it feels that it is not willing to assume all the risk of a transaction by itself. Then, the Administration will look at all the risks involved and the SBA loan would be made thereafter.

In any one year, tens of thousands of businesses have used the services represented by SBA loans and it is certainly true to say that they have been responsible for helping to elevate the numbers of self-employed in the United States, considerably.

There are not too many onerous requirements associated with SBA eligibility. In general, the Administration will look at the applicant’s personal credit history and the content of the business plan to see how they are handled within cash flow projections. The SBA will also look to see if the applicant has experience with the particular line of business concerned, how management control is exercised and how much of the applicant’s collateral is already established within the business. Should the applicant own more than 20%, he or she must personally guarantee the SBA loan.

SBA loans typically range up to 15 years, but this is dependent on the requirement. Specifically, loans that are needed for working capital can only be spread over seven years. If you are acquiring a business, on the other hand, the loan can be scheduled over a maximum of 10 years. To refinance property, look for an SBA loan that can be stretched over 20 years and with a purchase of real estate, you can even expect a period of up to 25 years.

You should have a business which turns over no more than $6 million per year and has less than 500 employees to qualify for an SBA loan. The SBA is particularly sympathetic to minority groups, including those run by veterans, women, Native Americans, although across the board, certain businesses are not considered, including those involved in speculative investments and non-profits.

If you have a relatively simple, startup enterprise in mind, you could consider the Micro-Loan program. This program is spread over six years and available up to $35,000. There are even simpler formats available for certain SBA loans, requiring very little documentation, also known as Low Doc, or those dealing with alternative financing, such as revolving credit and known as Express loans.

In summary, SBA loans are great ways for entrepreneurs to get outside funding, to push forward their business dreams and find access to the money that might otherwise be rather difficult to acquire.

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Incredible Tips On SBA Loans For Your Small Business

May 5, 2010

In 1953, the United States Government created the Small Business Administration (SBA) to help American entrepreneurs establish their businesses. The SBA underwrites qualifying loans made by other institutions and as such, this concept is attractive for those seeking money for business ventures. A normal SBA loan can be used to cover up to 90% of qualifying small business loans. The most popular application is known as the 7(a) SBA loan and is used for a variety of different solutions.

The Office of Advocacy has been set up by the Administration to look at all the banks around the country and determine which of them are “more business friendly.” In the majority of cases the lender will talk to the SBA if it feels that it is not willing to assume all the risk of a transaction by itself. Then, the Administration will look at all the risks involved and the SBA loan would be made thereafter.

It is estimated that tens of thousands of small businesses benefit from SBA loans in any given year, and that over the years this form of financing has been very beneficial in helping to swell the ranks of the self-employed, nationwide.

The SBA is not overly onerous in setting requirements for eligibility. In general, the Administration will look at the applicant’s personal credit history and the content of the business plan to see how they are handled within cash flow projections. The SBA will also look to see if the applicant has experience with the particular line of business concerned, how management control is exercised and how much of the applicant’s collateral is already established within the business. In addition, if the applicant owns more than 20% of the business, the SBA loan must be guaranteed by the applicant personally.

SBA loans typically range up to 15 years, but this is dependent on the requirement. For example, if you require the loan for working capital purposes, it can only be amortized over a period of seven years. If you are acquiring a business, on the other hand, the loan can be scheduled over a maximum of 10 years. Re-financing of property can attract an SBA loan amortized over 20 years, while outright real estate purchase can extend all the way out to 25 years.

If you have a relatively simple, startup enterprise in mind, you could consider the Micro-Loan program. Here, you could receive $35,000 and spread the repayment over up to six years. There are even simpler formats available for certain SBA loans, requiring very little documentation, also known as Low Doc, or those dealing with alternative financing, such as revolving credit and known as Express loans.

In summary, SBA loans are great ways for entrepreneurs to get outside funding, to push forward their business dreams and find access to the money that might otherwise be rather difficult to acquire.

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Valuable Pointers On Small Business Financing Strategies

May 1, 2010

The past few years have been momentous. 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. When you come to a certain age, it’s not much fun to be faced with the prospect of having to look for a new job, courtesy of this most severe recession. 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.

If you really sit down and think about it, we all have certain ideas inside us and we should reflect upon our abilities and talents to see how we could best use them when we become self-employed. Why not use some of your skills to provide much-needed services and products for others and as you journey down the road of entrepreneurialism, benefit from the peace of mind that comes with it. You might be saying to yourself, an idea is all well and good, but what about that thorny problem of 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. By starting off on a solid footing and by preparing your case adequately, small business financing options are available to you, to help you float 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. Remember that this program is a government-funded concept, and is essentially a guarantor of loans made by other parties. Basically the government will guarantee up to 90% of qualifying loans made this way.

If finding any down payment at all is an issue, financing for your small business could come in the form of 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 you can invest up to 100% of your retirement funds into a new business venture — without paying taxes or early distribution penalties? 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 your business requires significant asset purchases, you might consider equipment leasing. Equipment leases often come with extremely favorable rates, however, they can only be used for equipment purchases or refinancing.

In short, there are many small business financing and funding opportunities out there to help you achieve your dream, you just might be looking in the wrong place.

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Valuable Tips On Gaining Control Of Your Retirement Investments

April 26, 2010

For ultimate flexibility when planning for your retirement future, why not consider a self directed IRA LLC? You can make all the decisions associated with your investments and retirement plan yourself when thinking about this form of individual retirement account, commonly known as the IRA. This is an exciting and potentially lucrative way for you to take control over your retirement accounts. These highly flexible options can be used for a wide range of potential investments, including real estate purchases (domestic or international), private equity, partnerships, franchises, mortgages, small businesses, tax liens and so on. In truth, there is an almost unlimited array of options available to you with a self-directed IRA.

If you have a Roth IRA, traditional IRA, 401(k), 403 (b) or other plan, so long as it is a qualified retirement account it can be rolled into a self-directed IRA. The funds from your old accounts are then rolled over into the new plan, which then purchases shares of a custom limited liability company (LLC). This process allows you to gain complete control over your retirement account investments — without incurring penalties, transaction fees or early distribution taxes.

If you engage in this type of creative formatting, the potentially punitive asset-based and transactional fees that are associated with self directed IRA custodians can be avoided, and this can add up to hundreds or thousands of dollars in a given year. Not only that, but you will also be better positioned to take advantage of time-sensitive investment opportunities, such as foreclosure auctions. There are no potentially troublesome restrictions that could hinder you, from a time or access consideration, when trying to gain custodial approval and as such, the self-directed IRA LLC options are popular.

Normally, a custodian must be appointed to oversee all IRA matters. If a rental property is involved, as an example, rent checks must be forwarded to the IRA custodian on a monthly basis. From time to time, repairs would be necessary, but the custodian must issue approval before you can move forward. Each time the custodian gets involved, you can be sure that you will be paying transaction fees. Now, in the case of a self-directed IRA, when using an LLC structure all the custodian does is to invest funds into the LLC at the outset. The LLC manager (you) then takes care of all the day-to-day needs of the account. All those rent checks are collected by you and deposited, property repairs can be handled quite simply, with any related checks issued, there and then. With a self-directed IRA LLC, you are not held hostage — you are in control.

Earlier it was pointed out that there was an almost unlimited array of investment options available to you through a self directed IRA LLC. It’s important to point out the restrictions, however. According to the Internal Revenue Service, IRS, there are only two areas that you cannot deal with when involved with self-directed IRA accounts, including collectibles and life insurance. Collectibles includes items such as jewelry or works of art. The “collectibles” category also includes certain types of gold and silver coins. The coins that are not allowed have a value which is more derived from their collectible status, than the actual gold or silver content — thus making them a collectible.

There are few better alternatives than a self-directed IRA LLC for individuals who have had enough of dealing with the stock market, or are looking for investment products with additional security. It’s a great feeling when you have every day, hands-on control over your investments and the chance to build a really diversified portfolio, when using self-directed IRA programs.

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Several Helpful Ideas On Buying Real Estate In Your IRA

April 19, 2010

This country is based in large part upon the ability of an individual to take advantage of real estate opportunities. Even though real estate investing has been somewhat flat over the last couple of years of recession, if we look back over history we can see that it is normally a great way for individual investors to build a future for themselves and to take care of their retirement plans. Many people believe that individual retirement accounts (IRAs) are reserved for more traditional investment opportunities, like certificates of deposit or other mundane instruments. What they do not realize is that it’s possible to invest in real estate using IRA funds through a real estate IRA.

There are significant advantages and benefits to investing in real estate using a real estate IRA. Your investments can earn tax-deferred or tax-free profits, saving you the tax that you would otherwise have paid in capital gain or income tax, which can be significant — up to 50% or more in some cases.

Use a real estate IRA LLC to get significant control over the planning of your estate and to uncover how powerful compound interest can be, and see why this is often referred to as “the holy grail” of investments.

There are certain restrictions and rules associated with real estate IRAs, as you would expect. Specifically, you are not allowed to work or live in the property that you own as part of your self-directed real estate IRA, nor may you purchase an interest in a property or buy the property itself, if it is already owned by a “disqualified” person, as categorized. Disqualified people are those members of your immediate family, those of lineal descent and yourself, of course.

You can roll over funds from an existing IRA, 401(k), 403(B) or other qualified retirement account into a new real estate IRA. By establishing a limited liability company, you can also self-direct and self-manage your assets and allocate them to real estate investments without the hassle of going through a custodian for approval. If you are considering rental properties, be sure that your rental income in these cases is placed back into the IRA and not elsewhere.

Be very careful to ensure that all your financial transactions and any other dealings linked to your real estate are pushed through your self-directed real estate IRA. For example, if you are planning to renovate the property, all the expenses incurred must be paid for by the real estate IRA and, when you sell the upgraded property, all the funds must consequently go back into the IRA. In short, the real estate IRA must be the entity profiting from your transactions and it’s not okay, indeed illegal to keep the profits associated with these deals. Any transactions that could be classified as “self-dealing” must be avoided at all costs. That means that transactions between the buyer and the seller should come together naturally.

As the real estate market improves, and opportunities once again arise, a self-directed real estate IRA will allow you to take advantage of this turn. While a real estate IRA might not be for everyone, if you have experience investing in real estate, why not use your knowledge of the real estate market to dramatically increase the returns in your IRA?

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Fantastic Tips On Unsecured Small Business Loans

April 13, 2010

Did you know that 85% of loans made to small businesses originate through banks, according to the National Federation of Independent Business? There are a number of different options, but with a reasonably good credit history and associated rating, unsecured small business loans may be for you. There may be some expenditure associated with the origination of these loans, as more risk is attached from the lender’s perspective, but if you have a good track record and haven’t stretched yourself with your current credit lines, banks could listen sympathetically as you move forward.

Unsecured small business loans are generally discussed when the amount in question is less than $150,000. Due to their effective simplicity, unsecured small business loans do not take a long time to originate. As you might imagine, unsecured small business loans are essentially made in return for your reputation, and your signature on the document is the true promise of repayment.

In the case of a new business, you would personally need to guarantee these loans. In order to qualify you must have a credit score (also known as FICO) of more than 700, and your personal balance sheet must not show that you are overextended. When you apply, your use of credit will be looked at quite carefully and it is important that you don’t have more than 50% of any credit lines you may have access to engaged in other ventures. For example, with a total of $30,000 in available credit to you, you need to be sure that at least $15,000 of these funds are unencumbered. As your business moves forward and establishes its own credit history, the personal guarantee will become superfluous and in future you could attain unsecured small business loans by reference to your business credit by itself.

Many people will think twice before they sign over their major personal assets as collateral for a new business venture – and rightly so. After all, are you prepared to lose your home in the event of default on your business loan? Unsecured small business loans do not require you to pledge any of your personal assets, only your personal or business credit – that’s it. In the event your business fails, it is better to lose your good credit standing than your home.

Look at your personal situation very carefully before you apply for an unsecured small business loan. In particular, look at the higher interest rates that are typically associated with this type of loan and make sure that your revenue projections are able to account for these rates. With unsecured small business loans, your interest rates will range between six and 25% and generally speaking, these are amortized over a shorter period. The typical period is between five and seven years. Unsecured loans are typically more costly, but look at it from the bank’s perspective and realize that they are taking a much higher risk in this type of venture.

If you have plans for expansion and have carefully looked at these logically, with good thought process and projection, unsecured small business loans can be just perfect. You can originate these loans relatively quickly, so you can move quickly on your plans, and you leave your other significant assets unfettered. Then, for example, you can always look at getting a secured loan in future if you need more funds, and have numerous options available to you.

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