Saturday, 24 October 2015

Small Business Loan Requirement

Business Loan Requirement

Most business owners use credit for business expenses, including buying equipment and inventory. Unfortunately, most are using their personal credit cards and loans. While this largely unavoidable when you're just starting out, it's definitely risky. Personally guaranteeing business loans and credit accounts means you are completely liable for the debts. If your business is sued or you cannot pay back the debts, it will be you that is responsible -- not the business.

While it's possible to establish business credit for a sole proprietorship, it's much harder to do because your business is not a separate entity. The easiest way to get started on establishing credit for your business is forming a limited liability company or LLC. Forming an LLC protects you and other owners from being personally liable for business debt and it establishes a clear separation between the owners and the business -- one of the first steps to establishing business credit.

Steps to Establish Business Credit

These are the basic steps you will need to follow to establish a business credit history in the name of your business.

1. Form an LLC. The first step is forming your LLC to create a legal entity that is separate from the owners.

2. Get a federal tax identification number. Next, request an EIN, which works like a Social Security number for your LLC. You will need an EIN for federal tax filings and to open a bank account for your LLC.

3. Open a bank account. You will also need to open a business bank account in the name of your LLC. Make sure you pay business expenses from this account, not your personal account, or you risk "piercing the corporate veil," which means it may be ruled that your LLC is not managed as separate from your personal assets.

4. Get a business phone number. Your business will need its own phone number in the LLC's name.

5. Open a credit file. You will need to open a credit file with the three main credit reporting agencies: TransUnion, Equifax, and Experian.

6. Obtain business credit cards. The fastest and easiest way to start establishing credit in your LLC's name is applying for business credit cards that report to the agencies above. You will need to provide your EIN to apply. Examples of business credit cards include the American Express SimplyCash and the Chase Ink Cash cards.

7. Establish a line of credit. It's also important to establish credit lines with vendors and suppliers that you work with. Just as with personal credit, it's important to have a mix of credit types on your business credit file. Ask your vendors to report your payment history to the credit bureaus.

8. Pay on time. Finally, make sure your bills are paid on time as late payments will hurt your LLC's credit.

Establishing good credit history as soon as possible is important for several reasons. It positions you to get more favorable payment terms with new vendors and it helps you secure better terms when you need business loans. The first step is forming an LLC. You can learn more about forming a limited liability company by consulting with an attorney or business services company.

Purchases vs Leasing

Purchases vs Leasing

When you are looking to move into a new home, one of the first decisions that you need to make is whether you want to purchase or lease a property. Each has a number of distinct advantages and disadvantages, so it is important to consider everything before making your decision.

Here we will take a look at a few of the reasons why you should consider leasing over purchasing in some cases.

Smaller Investment

To purchase a property you will need to raise a fairly large amount of capital to handle issues like the deposit, legal fees and any money charged by your estate agent. Saving for these fees is often a long term process, with many people taking a number of years to build up the money required to actually make a purchase.

By contrast, when you lease a property you will usually only be required to pay a deposit alongside a month's rent in advance. This sum is invariably smaller than the amount that you need to save to make a purchase, which means that leasing is an excellent option for people who are looking to move as quickly as possible, for whatever reason.

Maintenance

When you purchase a property, you will be required to carry out any repairs and maintenance yourself. This can be an enormous drain on resources, particularly if your budget is such that you will struggle to make mortgage payments if something goes wrong with the house.

However, with leasing the general maintenance of the building and its facilities is less of an issue. Though you will often have to wait a little while to get an issue resolved, your responsibility lies in letting the owner of the building know about any issues that you are experiencing. It is then an issue that they will have to deal with in order to ensure they are offering the living conditions that were promised to you.

Flexibility

Once you have agreed to purchase a home you will be tied into paying for that property for as long as it takes to pay off the loan you have taken out for it. You have the option to sell, of course, but this is a long-winded process than can often take months, if not years.

When you lease a property you have much more flexibility, particularly if you are on a rolling monthly contract. This means that you are free to move on whenever you want, as long as you give the required notice as specified in the lease agreement.

The Property Market

When you lease a property you will not need to worry about fluctuations in the property market having an effect on the overall value of your home, as you do not own it. Instead, all you need to be concerned with is making the rent payments when they are due.

This can be excellent for those who want to dip their toes into the property market and experience living on their own for the first time, without worrying about the burden of responsibility that owning a property carries

How to Select Mortgage

How to Select Mortgage

The biggest secret to finding a good mortgage lender is patience. There are a substantial amount of options out there, and you'll have to find the right one for you, your family, and your financial requirements. Don't rush into a relationship with the wrong company. Just like when buying a new car, there are plenty of fine print and details to concern yourself over.

1. Name Isn't Everything

When shopping for a mortgage lender, it's important to keep in mind that the institution itself, no matter how secure it might feel, is not the one handling your loan. There is a difference between an organization and the individual representing it. In this case, that individual might be biting off a bit more than they can chew. Just because you think the security of your transaction increases because a big bank is involved, doesn't actually mean it does.

Here's one secret that should steer you clear of a lot of mistakes people make in the mortgage industry: lenders are salespeople. In fact, everything they do is to try and secure your business as a client. Even more, many titles in the industry only convey a sense of duties, not necessarily competence or ability. For example, senior positions usually only mean the individual has been with the company for several years. In other words, a senior loan officer isn't necessarily better for the job than your average loan officer.

2. Everyone Has Costs

Despite the "lowest rates" being advertised to you in a variety of places, every business still has overhead costs. While some take advantage of lower brick-and-mortar costs like rent, utilities, and man-hours by moving a sizable portion of their operation online, even that process costs money. That means that while they are eliminating costs and passing you savings in one way, they cost you more in another.

Make sure to get a detailed list of costs, commissions, and fees involved with your transaction. You might be surprised at how many of these relate to the their ability to work with underwritings, processing, and closing staff. Some will be in other companies, while many try to maintain the entire operation in house. For example, Correspondent lenders employ their own brokers, underwriters, and closers to ensure the process goes smoothly. They also have access to warehouse credit lines to fund loans. This means that you'll save time and energy throughout the process, but because of the convenience and extra work of that particular company, you might end up spending more than you think.

3. In-House Advantage

Speaking of in-house operations, it's also important to note that most real estate offices want to partner directly with lenders to streamline the selling process. That means you could end up with a loan originator from the same location that you found the home you actually want to buy. Are these a good idea? Isn't this a little like finding a swimsuit salesman at the front of the water park? Should you trust this option?

Keep in mind that this arrangement is mutually beneficial for both parties. Mortgage lenders get lots of business from real estate agents, and those agents get kickbacks when they send business to the lenders. Are they still capable of getting you a good deal? Certainly. Do they have your best interests at heart? Probably not. Don't be fooled by the in-house advantage; there are plenty of businesses out there willing to give you a competitive rate.

Payday Loan for Bad Credit

Payday Loan for Bad Credit

A payday loan is a Short Term loan that is often used to cover up unexpected expenses and it is paid into your bank account directly. In order to apply for this type of fund, it is vital that you should fill up the application form properly and that you should fill up a few other forms as well. If you follow this type of online application procedure, it is vital that you only have to spend a few minutes for this purpose. Once it is approved, there is possibility that the total amount of money will be deposited directly into your bank account. For this type of application process, all you have to do is to write your bank account number as well as Social Security Number on the application form. Here are a few things that you should consider before you apply for this type of fund as quickly as possible.

The first step that you should follow is to contact at least four or five lenders and that you should ask them to provide price estimates as quickly as possible. It is vital to remember that they all may provide different types of price quotes and it is important that you should choose someone who offers price rate that suits your requirement. Plus, you may ask him if you have to pay anything extra at any point of time.

When you look out for this type of fund, the thing that you should follow is to gather knowledge about its repayment terms. Repayment is the exact time that is allowed to the borrowers to repay the loan successfully. It is vital that you should be able to repay it within the stipulated period of time and it is also important to note that you may also have to face a penalty if you cannot repay it within that period of time.

However, there are a few lenders who allow you to extend that period of time up to six months. Therefore, the next step that you should follow is to ask about the necessary action that he should adopt if you do not have an adequate amount of money to repay it within the stipulated period of time. All you have to do is to apply for an extension at least two days before your scheduled date of loan repayment. It is vital that he should give you this kind of facility. He may ask you to pay the interest rate within the stipulated period time and he may also encourage you to repay the rest of the amount as quickly as possible.

Your next step is to find out the details of repayment terms as much as you can. All you have to do is to ask him about the exact date within which you have to pay off this kind of fund as soon as possible. It is important to remember that you will not be charged a penalty if you pack back this kind of fund prior to the specified period of time.

It is vital that you should find out the details of customer support that is offered by him. It is advisable that you should choose someone that provides excellent customer service and that listens to your problem whenever you approach him at any point of time.

The final step that you should follow is to contact your local business bureau as quickly as possible and that you should find out if there is any kind of complaint being launched against him at any point of time. Plus, you should also check out if there is any sort of negative review or comment being written by the customer on any social networking site at any point of time.