Entrepreneurial Ways to New Small Business Loans

Access to capital for small businesses still remains as dry as James Bond’s vodka martinis. Banks continue to keep their vault doors shut tight.  And, given that the portfolio of commercial loans in this country is teetering on a knife’s edges, who can blame these financial institutions for showing caution as these commercial loans can, at any moment, turn toxic (following the lead of all those subprime mortgage loans that trusted us into this financial crisis some two years ago).But, like the knife’s edge that these loan portfolios are balancing on, the economic recovery that is scarcely showing signs of life is also hanging on by a thread.Any recovery in this country will only be lead by small businesses.  It is small businesses that have the greatest impact on community development, hiring, growth and wealth creation.  And, when communities at large get lifted up by the very same members who reside there, all those within those communities benefit – all groups, not just a select few.However, when it comes to lending, given our current underwriting models, it is also these same small businesses that encompass the greatest amount of risk to banks, or so they say. But, maybe this greater risk is tied more closely to the method of underwriting than it is to the borrowers themselves.Banks and other financial lenders have essentially used the same underwriting guidelines or criteria for centuries.  At the beginning of the loan process, lenders tend to analysis a borrower’s past performance to gauge how each borrower will perform in the future; sometimes with very little understanding of where that borrower may ascend to at some future point in time.  Further, while most regional or national banks have taken strides in implementing new technologies seeming deigned to improve underwriting (usually by taking credit decisions out of the hands of local bankers), these new innovations merely follow the same flawed underwriting standards; they just deliver the results in a different manner or speed up the process.And, as we can clearly see, the current methods of underwriting are truly flawed; not just from the current shoddy or non-existent bank lending but also from the very short-term, low impact government run programs like SBA guaranteed loans have on overall small business lending; which on the surface are great programs but are flawed as they too rely on the same underwriting abilities of banks and other financial lenders.But, leave it to the entrepreneurial determination of many new entrants into the small business loan industry in seeking new ways not just to improve business loan underwriting but to disrupt the entire way that lending is conducted in this country.For example, most traditional banks loans are considered fire and forget (or more like fire and hope).  When a loan is approved and funded, lenders set payment dates (usually at monthly intervals) then essentially take themselves out of the picture (even though they may still require the business to report its financial position periodically). Then, should a borrower get into trouble, most lenders do not realize it until it is far too late for anything to be done (on both the bank’s and the borrower’s part) – all of which adds risk.However, there are new entrants that are attempting to reduce some of the risks to both themselves and their customers by not focusing so much on past performance but by looking more at today’s and each day’s cash balance.  Thus, instead of collecting payments monthly based on the borrower’s past profitability, they essentially take daily micro payments – payments that seem to place less of a cash flow burden on the borrower as well as reduce some risk associated with longer payment terms.  Moreover, by focusing on micro payments, profitability is no longer an underwriting requirement as the focus shifts to daily cash flow (which many businesses can generate even though they have yet to turn a profit).Further, this type of loan repayment also creates a strong relationship between borrower and lender as the lender works with and evaluates the borrower daily and not just quarterly when financial statements are due.There are also new entrants that facilitate lending among peers – termed, social lending, that is more community based lending than anything.  Based in part off the old and forgotten credo of credit unions where the community supported each other by pooling excess cash from some members and lending it others in need.  The real key here is that loan decisions are not based on some far away executed formula but by actual communication between borrower and lenders.There are also new entrants that look at lending as more of an investment in companies than actual loans – thus they do not require elements like time in business, profitability or collateral.  They are more interested in accessing the business’s ability to generate cash flow from the loan proceeds.  Not only are there non-bank lenders applying these new techniques but many private equity companies are entering this arena.  However, these players are taking it even one step further by approving entire loan requests, but tranching the funds at intervals that are conducive with business growth and development – called milestones.This type of thinking has also benefited Micro Lenders, who have some of the lowest levels of default in the industry.  While Micro Lenders may be able to lend much more than they do on average, there success stems from helping business owners build solid track records while providing them needed capital.  Many Micro Lenders usually only approve amounts smaller than those requested in the beginning.  But, as the borrower moves forward demonstrating their ability to service that loan amount, the Micro Lender then encourages the business to come back for more capital at larger amounts (even if the original loan is not yet paid off) – it is essentially similar to teaching a infant how to walk by making them craw first. Lastly, there is the community bank model.  While much of the community bank’s underwriting is based on current practices, community banks are the only real shinning example of traditional lending still working. The reason is that these organizations underwrite requests not only by solid lending standards but also via relationships – relationships with the borrower, with the community or neighborhood, with the local business climate as well as with local knowledge of assets used as security.   Thus, allowing these lenders to approve loans to businesses that other regional or national banks would run away from.While many of these new business loan models are still relatively young and have not yet strayed very far from traditional underwriting methods, they are making improvement in the industry; an industry that may take centuries to evolve.  But, one never knows how quickly new, disruptive, entrepreneurial companies can impose changes on industry participants that are blinded by the status quo.However, in the mean time, there still remains hope for small companies seeking business loans to start, manage or grow their enterprises via these up and coming entrepreneurial organization who are seeking new and improved ways to solve the current access to credit issues that nearly every small business faces today.

The Advantages of Getting an Unsecured Business Loan for Your Business

If you simply do not have the spare money to spend, you can turn to an unsecured business loan. These type of loans are a positive alternative for people who own businesses – some companies make sure the money is available within 24 hours of applying. Take note that business loans are different than personal loans – these type of loans are only meant to be used for business reasons.Easier to Obtain Than Secured Business LoansAn unsecured business loan will be easier to obtain than a secured business loan. This is because your business will not need to put any collateral up front.No Collateral with Unsecured Business LoanWith a secured loan, if you do not pay the loan back, lenders will be able to take the collateral from you. However, if you default on an unsecured business loan, the lender will not be able to take your business’ property, unless they get a court order.The Court Can Discharge Unsecured Loans When Filing BankruptcyIf for some odd reason your business has to file for bankruptcy (we hope this never happens), the court can discharge those unsecured loans. However, it’s not normal for them to discharge a secured loan.Quick Turnaround TimeWith most lenders, as long as you qualify for the loan, you will have cash available in a couple of business days. With banks, on the other hand, it could take weeks before you see the money you need.Credit Scores Don’t CountIf you are a business going in for an unsecured company/business loan, your credit scores will not count. The qualification will be based on your business – if you have a strong business, you shouldn’t have a problem getting money from a lender.Payments will be AdjustedThe amount you are asked to pay back on a daily basis will all depend on the profits your business made. What this means is the amount repaid will adjust in accordance with both slow business and profitable times. This technique makes it easy to pay the money back, without going broke at the same time.Unlimited Funding PotentialAs the sales for your business increase or if you simply need more money for your business, you can apply for more money, as long as you are in good standings.
As you see, there are many factors to getting an unsecured business loan to help your business during harsh times. Almost any established business, regardless of the industry, can qualify for this form of loan. Most companies have a short application that you are required to fill out in order to determine if you are eligible for the money.

Online Bad Credit Small Business Loans: Business Loans 24 Hours

Need finance to start or extend your business? But if bad credit affects you from doing so, then avail bad credit small business loans. Bad credit small business loans are loans approved to all bad credit borrowers that help such borrowers to give a kick start to their business.Online bad credit small business loans are short term business loans that look for all business needs and requirements like for buying of raw materials, machinery; paying of wages etc. These loans are helpful for all bad credit borrowers for starting of new business or for extending, reorganizing of the previous business.Online bad credit business loans are secured as well unsecured in nature. Secured online bad credit business loans require borrowers to keep his assets as security to guard the loan amount. Borrowers can keep any of his assets like house, jewellery, vehicle etc as collateral against the loan amount.
Unsecured online bad credit business loans do not require borrower to plea any security as assets. The most acceptable collateral for bad credit business loans is property but according to lender policy other things are also acceptedThe main advantage of online bad credit small business loans is that it gives a chance to improve upon the credits score for all bad credit borrowers. Borrowers can avail bad credit small business loans and by following the terms and conditions can work on to improve his credit scores and thus credit history.Since bad credit small business loans are available online, all bad credit borrowers can easily avail benefits of online bad credit small business loans. Borrowers just need to research properly before finalizing on the particular deal by a lender. Online is one of the best medium to avail online bad credit small business loans.Bid good bye to all your harassments which you used to face because of your bad credit scores. With online bad credit small business loans all your business needs can be looked after more easily and effectively.

Boost Your Income By Making Money Online

Making money online can be as easy as just putting your mind to doing it. All you need is a computer and a place to get online. Having said that, it’s useful to have a few tricks and pieces of knowledge about where to start successfully, so keep reading.To generate money on the Internet, you must first discern your niche. Do you like writing? You can sell your articles online or freelance for companies who want you to write for them. Are you a talented graphic designer? You can get hired to work on the designs of people’s sites. Introspection can help with this.Writers can write for sites like InfoBarrel and Squidoo which offer revenue sharing. You can write about whatever you want on these sites and get a portion of the revenue your content generates. They also allow you to link with Amazon’s affiliate program to boost your earnings even more.Schedule your time wisely. Online income is definitely tied to your ability to keep at it on a continuous basis. You cannot get rich overnight. You have to be diligent in your work ethic on a daily basis. You need to have a time established daily for focused work. An hour can make a surprisingly large difference.Consider taking surveys. There are many out there. Completing surveys allows you to generate a nice income stream. You may not make a lot from any individual survey. This is easy when you have some down time, and that money can quickly add up.You will need ID to make money online. You will have to offer the same info as when you take on a real life job. If you do not currently have your ID on digital file, make sure you get them before applying to make the process quicker.Use Google to find money-making opportunities on the Internet. Your query will generate a lot of results. When you find something interesting, thoroughly research the company prior to doing business with them. See to it that you are cautious when dealing the company that you choose.Before working online, think about how much you value your time. How much do you want to make for each hour that you work? If you want to work for just a small bit, you may never earn more. People will think that you are not worth a lot of money and will pay you in a cheap way.There are legit ways to make money, but there are also scams online. That is why you need to carefully check each company before agreeing to make money through them. The Better Business Bureau is something you can look to so you can see what a company is like.You could offer advertising space on your page. One of the best ways to earn money is through advertisements on your website. If you have a popular blog now, some sellers may wish to pay you for having their ads placed on it. The ad drives readers to a new site selling items.Making money online will be easy if you use these tips. Just learn all you can and never stop looking for new information. Keep reading articles just like this one to broaden your horizons, open your mind and prepare you for success.