Although Rapid Biz Credit does not provide financing, we can assist you in positioning your company to obtain financing by utilizing proven reliable techniques.
By selecting RapidBizCredit's Credit Builder Program you will increase the likelihood of your business receiving financing. Why?
The first critical step is placing your company on the global map.
That's exactly what RapidBizCredit does when we help you develop Corporate Credit, a Corporate Image, and solid usable credit accounts using RapidBizCredits, vendors, and credit contracts with Fortune 500 companies. This is exactly what our Credit Builder Program does.
Without this first step, your company will never get financing. After all, do you think any bank is going to look at your “empty” corporate credit report and give you money … not a chance.
If you desire to get financing without this critical step, your only hope is to win the lottery or have a rich uncle. Then again if you did, you wouldn't be planning the growth of your company, you wouldn't be reading this webpage and instead you'd be on the beach somewhere sipping a cool one.
Fortunately, RapidBizCredit is the answer to the initial process of building your business credit report and it's the most important step you can make for your business , because;
This is the perfect reason for developing your Corporate Credit. It helps to conserve your precious cash by using revolving lines of credit while saving your cash for those items that require cash.
Now you can operate your business more efficiently which can help you grow your business to be even more profitable.
This is probably the most overlooked and least understood aspect of credit and lending practices.
Simply put, RapidBizCredit can assist the business owner with a one day old Corporation, develop a great business profile, and establish some basic vendor credit immediately. Larger vendor credit lines take longer.
With financing, not only is the business credit report important, the age of the company is also important. It seems logical that a lender will look at a company that has been in business for several years much differently than a company that has only been in business for only 2 months.
If you have specific questions regarding purchasing an aged-corporation that is 2-10 years old please ask your RapidBizCredit representative.
RapidBizCredit emphasizes good bookkeeping because it makes good business sense. You will thank yourself in the future because financials are often requested for a lender to make a decision of how much money to give your company.
Some of the RapidBizCredit Credit Builder Programs offer you guidance with QuickBooks, the most used software bookkeeping system for the personal computer.
Take advantage of RapidBizCredit offer to help you with your accounting, get QuickBooks installed on your system, and let us show you how to use it. You'll be thanking us every month, year after year, that you got started keeping your own records.
We don't want you to be intimated by accounting. If you need more assistance we have a staff of accounting folks that are ready to assist you.
Financing comes in as many colors as the rainbow.. well, maybe even more.
There is equipment financing, gap financing, purchase financing, and just plain old “give me some money” financing, typically called a Line of Credit.
Equipment financing and a Line of Credit are the most common applications a lender will see. A Bank Line of Credit is essentially a bank loan. It may take the form of a revolving line of credit which can be used on demand and must be repaid on an annual basis.
A Bank Line of Credit is not to be confused with a credit line from a vendor or supplier, commonly referred to as business-to-business credit, a RapidBizCredit, or trade credit. A Bank Line of Credit is a bank-to-business loan.
The good thing about a Bank Line of Credit is that the interest is typically paid only on the outstanding balance (the money used or drawn out) and not the entire approved loan amount. It's like having a giant cash credit card. If your company uses money for a while, then puts it back, a Bank Line of Credit may be the right type of business loan for you. This is very useful for many business owners.
Use of Funds is often a consideration a lender will have in approving a loan to your company. So select your definition of use of funds carefully.
You're now ready to seek financing from a lender. Listed here are some details on different types of financing or funding available to businesses.
1. Line of Credit:
The lender agrees to loan a specific amount of money for a specified amount of time, usually a year and allows the borrower (business owner) to borrow the money again once it has been repaid. Lines of credit are often set up to insure against cash now problems. Examples Include:
| I. | RESIDENTIAL EQUITY LINES: Lines that are secured by equity in a property |
| II. | CAPLINES: Short term revolving lines of credit; They act as a credit card |
| III. | SEASONAL LINE |
| IV | BUILDERS LINE |
| V. | STANDARD ASSET and SMALL ASSET-BASE LINES |
2. Term Loans:
A Term Loan is a loan that is re-paid in fixed payments, usually over a 1 to 15 year period. It can be fully amortizing, or interest only, with a balloon payment at the end of the term. Term loans are the most general-purpose loans. They're used for working capital, expansion, refinancing, commercial real estate, purchasing of fixed assets, and acquisitions. You'll repay them monthly over a term based on the expected lifespan of the asset(s) you're purchasing. Examples Include:
3. SBA (Small Business Administration) LOANS:
Loan made by local bank that is guaranteed by the U.S. Small Business Administration. If the borrower defaults on the loan, the SBA will reimburse the bank for a percentage of the loss. The Government also offers other business loans that could fall under the SBA heading as well. Examples Include:
i. LOW DOCUMENTATION LOAN: Ideal for people looking to borrowing $150k or less to start a business
ii. SMALL BUSINESS EXPRESS LOAN: Fast and easy way to get up to $150k. Borrowers fill out 1 page application and within 3 days or less
iii. PRE-QUALIFICATION PROGRAM: These Loans are typically tailored for minority and women small business owners
iv. MICROLOAN: Under this program funds are made available to qualified non-profit organizations, which act as intermediary lenders. These organizations then lend eligible borrowers up to $35k
v. 504 LOAN: Designed to help small business grow, these loans usually have lower down payments and below-market fixed-rate financing, and longer repayment terms. The money is usually distributed from a Certified Development Company or CDC.
vi. DTI LOAN GUARANTEE SCHEME: Usually use to expand a firms operational capacity. The scheme is intended for sound business projects that cannot get conventional financing because they cannot provide adequate security.
4. LEASING:
Many businesses lease assets as an alternative to owning them. Leasing is comparable to borrowing money to buy assets. In either instance, the business will use the asset(s) and either meets the monthly lease payments or pays of the loan. The major difference in leasing is that the business doesn't own the asset(s). Examples include:
I. EQUIPMENT LEASING
II. DIRECT LEASING: A business acquires the use of an asset for an already agreed upon series of cash payments.
III. SALE AND LEASEBACK: The business sales an asset(s) (such as equipment and or a building) that it already owns and then leases it back. This way, the business receives an inflow of cash on the sale asset and also the use of the asset.
IV. CAPITAL LEASES: This product is done by a third party agreement; in which the third party enters the lessee-lessor arrangement to become the lender who helps finance the acquisition of the asset to be leased. Payments of the principal and interest are made at equal intervals in equal amounts. In most cases, the lessor retains ownership of the leased asset at the end of the lease.
V. VEHICLE LEASING: Used for financing light trucks, automobiles, and other vehicles to be used for business purposes.
5. REAL ESTATE LOANS:
Real estate loans are basically first and or second business mortgages. Businesses will often use real estate loans to expand their current business. These loans are also use to invest in residential and commercial property. Payment terms are usually set at 10 years. Interest rates can be fixed and are very competitive compared to other types small business loans. The interest is sometimes tax deductible. Examples include:
6. FACTORING:
Also known as receivables financing, is basically selling your invoices to a third party to get your funds now: instead of waiting for your customers to pay, you can get the funds immediately - minus a small fee (3% to 5%) that is due to the factoring company. You'll typically receive 80% of the invoice value upfront and the remaining value once the client pays. Examples Include:
7. CREDIT CARD ADVANCES:
Real estate loans are basically first and or second business mortgages. Businesses will often use real estate loans to expand their current business. These loans are also use to invest in residential and commercial property. Payment terms are usually set at 10 years. Interest rates can be fixed and are very competitive compared to other types small business loans. The interest is sometimes tax deductible. Examples include:
8. EQUIPMENT FINANCING:
Equipment loans are used to finance equipment or other capital assets a business needs. Businesses typically rely on equipment loans to buy printing, distribution, and or manufacturing equipment. Equipment Financing is generally easier to obtain then the other types of loans, simply because the equipment your business buys serves as direct collateral for the loan. It's also one of the least risky types of loans. If you are unable to make your payments, normally you don't have a lien against your entire business or your personal real estate; all you lose is the equipment you bought. Depending on the size of your business, equipment financing can cover huge expanses. Payment terms can range from 1 to 5 years. Longer payment terms might be available, depending on the lending institution and the loan type. Equipment Loans also can have fixed variable interest rates.
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