Commercial Financing for Your Small Business

It’s common for businesses of all sizes to experience fluctuations in cash flow from time to time. Small businesses, in particular, may experience variations in market demand that necessitate a loan. These can include cash loans in the form of overdrafts, lines of credit, and other types of debt. There are a range of commercial loans available to business borrowers.

Credit Cards

Credits cards should ideally be used only to fund short term needs or as a convenient payment method for businesses. Credit cards tend to have higher interest rates and are interest-free only until the next billing cycle. Businesses seeking short term cash finance should use an overdraft or a line of credit.

Leases and Hire Purchases

These are several of the most common types of commercial financing for cars, equipment, plant, and technology. Leases and hire purchases use the leased or hire purchased asset to secure the loan and so are very easy to obtain. The business makes regular payments, over months or years, often until they obtain full ownership over the product (hire purchases). In case of leases, the business usually has the option of purchasing the vehicle or equipment at the end of the agreed lease term, for a sum set by the lease company. There are different tax implications for items bought under a lease and hire purchase agreement that businesses should stay aware of.

Overdraft Facility

Overdraft facilities are very common for businesses. They are attached to business accounts and come with a limit, known as an “overdraft limit.” Lending banks and institutions may conduct a credit assessment and ask for some form of security. An overdraft facility is one of the fast loans, an easy option that can be accessed, once the overdraft is approved, without further authorisation and used much like a debit account as long as the limit isn’t exceeded.

Line of Credit

Lines of credits are secured by a mortgage over a property, which can be your office or place of business. Lines of credit tend to have more attractive (lower) interest rates than overdrafts as they are always secured, while offering the same level of flexibility. However, unlike an overdraft, repayments that cover interest payments and associated fees must be made periodically.

Fully Drawn Advance

Fully drawn advances provide upfront financing, usually larger amounts. These advances are often used for funding longer term outlays such as capital expenditure (equipment) and investments, and are not designed for short term needs. They come with scheduled repayments for both interest and principal, and are secured with a mortgage over a property or commercial asset.

An example of a fully drawn advantage is a business home loan, where business owners can certify their own income and borrow against the value of their personal home. Borrowers can borrow in their own name, the company name, or under some other legal structure. Borrowers can borrow as much as 80 per cent of the value of their home.

Debtor Financing

It is also common for some businesses to obtain finance by securing a loan on the total amount owing to the business by customers as identified by their accounts receivable ledger. Usually the loan amount can be up to 80 per cent of the total amount owing. This is a short term financing option that allows businesses to receive needed funds well before customers make payment and assists with smoothing out the invoice cycle. It’s highly flexible and tied to the amount of business or sales made by the business.

Finance a Car the Smart Way

Few people can afford to pay for a car by simply writing a cheque or paying cash, especially a brand new car. Even a few thousand dollars can be hard to come up with on the spot. This means you need to get a loan of some kind. Are you familiar with APR and 0% financing? Have you examined potential loan arrangements ahead of time? If not, then familiarize yourself with the negative and positive aspects of each institution that will gladly help you finance a car.

The reason they will be so glad is that this is how they make money, whether you are dealing with the automotive salesman, your bank, a private institution, or an online business. Going to your bank for a loan is probably the most sensible option to take. For one thing, they have a vested interest in keeping your business if you already hold accounts there. They are heavily regulated to protect customers. You probably have a business relationship with at least one individual here, thanks to your mortgage or commercial transactions. Perhaps you trust this individual and can work directly with him to secure your loan. In this case, he can discuss your potential car purchase with honesty, exposing anything that looks suspicious about the deal in his professional opinion.

It is not that car dealers are necessarily going to pull the wool over your eyes, but some deals sound better at first than they actually turn out to be. There is no lying involved, just a certain amount of sweet talking. A dealer is likely to try and have you sign a financing deal with him right there at the car lot. If he does, then you are going to feel pressured. You just want to drive off the lot with your brand new (or lightly used) vehicle, not sit around reading small print. The thing is you need to read that tiny printing and be aware of interest rates, penalties and any extra fees.

Some people will go with online financing companies, and this can be a highly convenient way to finance a car purchase if you have no credit history or your rating is poor. Take care, however, to establish the credentials of any financial institution. If the rates look too good to be true, they are probably unreliable. Whichever route you take has to be one you can live with for many months.

Car Finance Options For You – How to Search For Car Loans Online

Wanting to have a car is quite natural for all of us. We need a working car that can take us to work, to school and to any other place we think of. While the desire for a used or new car is always present, it is not always that we have the funds to finance our desires to buy a car. With the help of car finance companies that offer car loans, you can make your plans an easy reality and drive home the car that you want.

Getting the right financing for your car can be easy if your credit is history is good. You simply have to find the car finance company that you prefer, process the loan application, and wait for it to get approved. All these can be made without bumps and creases if your credit score is good. What if, however, that you have bad credit standing? Does it mean that you will never have the means to buy the car that you want? Does it mean that you cannot apply for car loans because you will only get disapproved in the end? The answers to these questions have changed dramatically over the years as there are now more lenders opening their doors to people with bad credit.

You can now apply for a car loan even if your credit standing is not perfect. You do not need to have an impeccable credit history just to apply for a car loan that is reasonable to you as a buyer. All you need to do is to find the right lender and this task has been made easier nowadays. Finding a lender who is open to bad credit car financing can be tricky without the help of a good information site. You must hook up with online sites that specialize in finding financers for car loans whatever financial situation you are in.

Such websites can help you make your search for car finance easier and more convenient. You can access such websites so that you can be led to the best possible car financier for your needs. When using a car finance directory, listing or information site, you usually just have to enter your information and also the finance terms that you prefer. That particular website will then lead you to providers of car loans so that you can create a good deal that is both fair to you and to the financier.

Making use of such search websites can make your financier search easier. You do not have to hop from one website to another nor do you have to drive from lender’s office to another just to check if they accept your application for car loans. With one site, you can be directed to a financier that can guarantee you to have the car loan you need. That way, you do not waste time, energy and efforts but you also get assured of getting the financing you need in terms that is light on your shoulders.

Finance For Used Cars

The majority of the problems that occur when individuals want to finance for used car are related to the importance of the paperwork. Many of us think that paperwork ought to be completed as quickly as possible so that we are able to drive with this cars right away. You shouldn’t rush into any decisions when financing a used car because there is really a significant amount of cash that you must consider and there’s no room for mistakes.

To start with, it is crucial to get the deal decided through the car salesman to be put in writing within the contract. In other words, anything must feature the monthly payments which are based on the interest rate. Speaking of the interest rate, it’s a common practice among dealerships to inflate it so that they can create a nice extra profit. If you want to avoid this and I’m sure you need to do, you’ll need to get independent vehicle financing before heading out towards the dealership. In so doing, you are able to proceed as a “cash buyer” and the only thing that you’ll be negotiating may be the cost of the vehicle. Obviously, car salesman always have preferred their customers to possess monthly obligations because in this manner it’s easier to allow them to hide some of the costs of the car.

Finance for car or truck can be obtained from a bank, on-line lender. The most common issues car buyers need to face when trying to invest in an automobile are:

a) They don’t know their credit score – because of this, you should order a duplicate of the credit report and proper any discrepancies that you simply notice. The loan bureau will specify how you can fix these errors when they send you the report;

b) They have the tendency to overspend once they reach the dealership – and that’s why you should jot down a price range for that vehicle and stick to it all the time. According to finance experts, the vehicle payments combined with the related expenses shouldn’t consist of more than 20% of your monthly net income;

c) Many car buyers go to the dealerships without having done some research concerning the current rates of interest and as a consequence, they don’t know if the speed they’re offered is competitive or not – for this reason, you should use the web to compare rates and obtain a clearer image of what you should be looking for in the dealer;

d) Lots of car buyers navigate to the dealership without obtaining the appropriate auto financing which means that they won’t have any negotiation powers when discussing using the dealership concerning the interest rates – which is why you need to get a no-obligation loan before heading out to the dealership;

e) In certain situations, the customers are confused or pressured by the staff of the dealership and although they have second thoughts, they still sign the offer – which is why you should do your homework in advance so that you can know what to anticipate from the dealer.

As you can see, there are a lot of problems that must be taken into consideration before purchasing a used car. Considering that always we’re referring to a lot of money, you’d better do your homework to be able to grab a good deal that won’t ruin your wallet.

Do it Yourself, No Money Down – Bad Credit Auto Financing For Cars, Trucks Or Motorcycles

A rumor that has been spread since the 1960′s is that whatever a car dealer gets for a down payment is nothing more than profit. This rumor is in part, true.

An Example

The following example applies whether you’re buying a car, truck or motorcycle with bad credit.

Let’s say that you want to purchase a used car that has a selling price of $15000.00 and the dealer is telling you that because of your bad credit history, you have to put down a 10% down payment of $1500.00. In cases like this, it is very likely that the loan company approving you will only “advance” $13,500.00 on the vehicle in question and this is generally based on loan value. Typically, the dealer will have paid somewhere around loan value for the car and if they sell it at this price, then they aren’t making any profit. So in this common example, requesting that you make a cash down payment of $1500.00 is in fact, $1500.00 of dealer profit and nothing more.

Dealers do have to make money and $1500.00 is a reasonable profit. It’s disheartening however, to fork over a couple weeks worth of income just to make that happen, though.

How to Get A Car with No Money Down

If you have bad credit and need auto financing, and you don’t want to put any money down, there is a solution. Now, hear me out on this, because this information can really benefit you and this information comes from 20 years of experience working in car dealership finance departments…

Buying a car from a private owner. This reduces the amount financed by around 7% or whatever your local tax rates are. This reduces the amount needed to buy the car and less money that has to be borrowed. There are also no dealer “doc” fee or dealer “prep” fee, which also reduces the amount needed to be loaned by $99 to $599 typically charged by car dealerships. Reducing the amount needed is good!

Negotiating with a private seller on the sale price is MUCH easier than negotiating with people that do it for a living (car dealers). If the seller doesn’t have a large amount owed to the bank and is frustrated with taking time to show the car, you may be very surprised to find some really great prices on cars for sale by owner. This can be in your local newspaper, bargain paper or online classified.

“Do-It-Yourself” auto financing. This is the most important part. Bad credit doesn’t mean that you can’t get a car loan from a loan company outside of a car dealership. If you deal with a loan company directly, you’re only dealing with them on the finance side of the purchase, not the price of the car. This enables you to qualify (get approved) for a specific dollar amount that you can base your car shopping on. There are online resources to do this from the comfort and privacy of your home.

Summary

Buying a car from a private owner reduces the amount you need to borrow significantly and if you shop a little, you’ll have no need for a down payment, whatsoever. Also, this involves arranging your own financing which is very doable if you have bad credit and know where to go.