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Will You Add? - 7 Steps To Get A Loan For Your Business
Throughout the ages, virtually every society has valued its storytellers. Ancient civilizations would rely on the village elders to tell stories to the young children in order to pass along the community’s history and tribal knowledge. Stories were also used to train the youngsters for hunting and to face challenges related to survival in the wild.We continue to place a premium on people who have the ability to tell a story - even thousands of years later. Television and motion picture actors, producers, and directors are highly sought after and regarded. Comedians and authors of novels are revered as extraordinarily gifted. Each is valued because each can influence the way you feel. When you go to the movies you want to be thrilled, confused, or scared – without it having an impact on your life. When you see a comedy show, you want to laugh at someone else or at his misfortune. Like all of us, you love to experience emotions in a vicarious state. A good story makes you feel a certain way without the negative side effects.A client is more likely
Step 4: Start writing the business plan and create the financial projections.
The business plan is more than a plan—it is a tool that helps you evaluate your business concept, your product or service, and discusses how to implement your ideas. A business plan is also a tool to obtain investors, lenders, and strategic partners. You can find many resources and opinions on the Internet as well as your local bookstore on how to build an effective business plan. A lender will usually require a comprehensive business plan as well as a projected 1-year cash flow projection (month-by-month), 3 years
Buying credit card processing terminals for a retail business can be a substantial investment, costing several thousand dollars or more in many cases. When you invest this much money in this rather essential equipment, it is quite natural to want to properly maintain the equipment and extend its useful life for as long as possible.One of the best ways to prevent your credit card terminals from breaking down prematurely is to clean them periodically.The presence of dust, crumbs, and paper lint can cause built-in printers and stripe readers to become clogged making card reading devices difficult or impossible to use properly. A simple $2 investment in a can of compressed air, however, can help you quickly and easily clean your terminals, helping them last for up to five years without missing a beat.When you buy new equipment of any kind for your business it is essential that you stay in the habit of maintaining it, and remind your employees to do the same.Another, perhaps less obvious way to ensure the longevity of your card reading e
Loans are a time-tested way of raising capital for your business. We would love to tell you that it is as easy as going to the bank and asking for money, but as you probably know by now it is quite the opposite. We wrote the following steps to help you raise the right amount of capital to get your business going.
Step 1: Decide how much money you need.
This is an obvious but often misunderstood statement. Entrepreneurs, particularly start-ups, when budgeting for their business often focus on what they will need to get their business going, or to finance a particular project without accounting for working capital or cash for contingencies. This is dangerous because lack of working capital can mean the death knell for the business.
On the other hand, some entrepreneurs, again start-ups, drastically overestimate their costs. This will make lenders not only to question the entrepreneurs’ assumptions, but also question whether they know what they are doing.
Now that we decided on an amount, lets focus on the lender.
a) If you are a start-up:
Loan amounts below $25,000 are considered smaller, micro-loans. Not all banks will be interested in doing a SBA guaranteed loan for small amounts (more below). Micro-lenders and Alternative-lenders are better equipped to handle this type of loans. These lenders usually make smaller loans and have a community focus. Look to credit unions, local development corporations and other non-profit lenders.
A Small Business Administration (SBA) guaranteed loan is a guarantee to the lender. If the borrower defaults, the lender is guaranteed repayment of a portion of the loan by the SBA. You are still liable for the loan, so your obligation does not go away. From our experience, an amount of $50,000 and above is the usual range for SBA loans. The higher the amount requested the more the lender would look for collateral to secure the loans. Start-ups and existing businesses can apply for SBA guaranteed loans.
b) If you are an existing business:
If you own a company that has documented sales (you will need to show previous years’ tax statements) then you can apply for conventional bank loans. These loans are usually easier to apply, and may have lower interest rates. Normally for a conventional bank loan, you will need to be in operations for at least 2 years.
c) Set your expectations:
The bank does not want to own your business. It is highly unlikely that you will get a loan for a 100% percent of the project cost. You will need to put down a co-payment. Although the minimum co-payment varies by industry and lender, expect to put down at least 20%-30% or more of the cost of the project.
Step 2: Find out your credit score.
You should check your credit score and look over your credit report to make sure there are no problems. A credit score of above 650-680 is considered “Good”, but it does not mean you will get a loan. A credit score in the 700-800’s is very good and increases your chance of getting approved.
You can request your credit report from one of the reporting agencies, or use one of the many online services available to check your score.
Step 3: Start researching your options.
Start weighing all your options. Think of ways to strengthen your loan application. Can you find a co-signer? Bring in a partner with good credit or experience? Invest more cash into the business? If you think that you are not a strong candidate for a business loan, you can present the lender with options to increase your chances.
Step 4: Start writing the business plan and create the financial projections.
The business plan is more than a plan—it is a tool that helps you evaluate your business concept, your product or service, and discusses how to implement your ideas. A business plan is also a tool to obtain investors, lenders, and strategic partners. You can find many resources and opinions on the Internet as well as your local bookstore on how to build an effective business plan. A lender will usually require a comprehensive business plan as well as a projected 1-year cash flow projection (month-by-month), 3 years
The Kansas State Agency that oversees the collection and reporting of State income taxes deducted from payroll checks is:Department of Revenue Docking State Office Bldg. 915 S.W. Harrison Topeka, KS 66625 (877) 526-7738 www.ink.org/public/kdorKansas does not require you to use a state form to calculate state income tax withholding.Not all states allow salary reductions made under Section 125 cafeteria plans or 401(k) to be treated in the same manner as the IRS code allows. In Kansas's cafeteria plans are not taxable for income tax calculation; not taxable for unemployment insurance purposes. 401(k) plan deferrals are not taxable for income taxes; taxable for unemployment purposes.In Kansas supplemental wages are taxed at a 5% flat rate.In Kansas supplemental wages are required to be aggregated for the state income tax withholding calculation.You must file your Kansas state W-2s by magnetic media if you are have at least 250 employees and are required to file your federal W-2s by m
On the other hand, some entrepreneurs, again start-ups, drastically overestimate their costs. This will make lenders not only to question the entrepreneurs’ assumptions, but also question whether they know what they are doing.
Now that we decided on an amount, lets focus on the lender.
a) If you are a start-up:
Loan amounts below $25,000 are considered smaller, micro-loans. Not all banks will be interested in doing a SBA guaranteed loan for small amounts (more below). Micro-lenders and Alternative-lenders are better equipped to handle this type of loans. These lenders usually make smaller loans and have a community focus. Look to credit unions, local development corporations and other non-profit lenders.
A Small Business Administration (SBA) guaranteed loan is a guarantee to the lender. If the borrower defaults, the lender is guaranteed repayment of a portion of the loan by the SBA. You are still liable for the loan, so your obligation does not go away. From our experience, an amount of $50,000 and above is the usual range for SBA loans. The higher the amount requested the more the lender would look for collateral to secure the loans. Start-ups and existing businesses can apply for SBA guaranteed loans.
b) If you are an existing business:
If you own a company that has documented sales (you will need to show previous years’ tax statements) then you can apply for conventional bank loans. These loans are usually easier to apply, and may have lower interest rates. Normally for a conventional bank loan, you will need to be in operations for at least 2 years.
c) Set your expectations:
The bank does not want to own your business. It is highly unlikely that you will get a loan for a 100% percent of the project cost. You will need to put down a co-payment. Although the minimum co-payment varies by industry and lender, expect to put down at least 20%-30% or more of the cost of the project.
Step 2: Find out your credit score.
You should check your credit score and look over your credit report to make sure there are no problems. A credit score of above 650-680 is considered “Good”, but it does not mean you will get a loan. A credit score in the 700-800’s is very good and increases your chance of getting approved.
You can request your credit report from one of the reporting agencies, or use one of the many online services available to check your score.
Step 3: Start researching your options.
Start weighing all your options. Think of ways to strengthen your loan application. Can you find a co-signer? Bring in a partner with good credit or experience? Invest more cash into the business? If you think that you are not a strong candidate for a business loan, you can present the lender with options to increase your chances.
Step 4: Start writing the business plan and create the financial projections.
The business plan is more than a plan—it is a tool that helps you evaluate your business concept, your product or service, and discusses how to implement your ideas. A business plan is also a tool to obtain investors, lenders, and strategic partners. You can find many resources and opinions on the Internet as well as your local bookstore on how to build an effective business plan. A lender will usually require a comprehensive business plan as well as a projected 1-year cash flow projection (month-by-month), 3 years
“The cautious seldom err.” Confucius“Be prepared.” Robert Baden-PowellTo begin at the beginning is always a good place to start. Let’s begin with a shocking statement by a senior government member of the Electronic Crimes Task Force, “Many businesses should never have deployed a wireless network.”He was referring, of course, to the many security issues and problems that wireless systems generate for his group. In addition to security, there are many other items to consider before an enterprise embarks on the path to wireless networks. During the fuel rationing era of World War II countless billboards advised, “Is this trip really necessary?” The same question should be asked before setting off on the wireless journey.Wisdom dictates that we should begin with the end in mind. The company must decide what benefits wireless networks will provide. In some cases it will be legitimate: to increase productivity, advance the speed of data and decisions for key personnel, to empower mobile workers, or to garner cost savings in
b) If you are an existing business:
If you own a company that has documented sales (you will need to show previous years’ tax statements) then you can apply for conventional bank loans. These loans are usually easier to apply, and may have lower interest rates. Normally for a conventional bank loan, you will need to be in operations for at least 2 years.
c) Set your expectations:
The bank does not want to own your business. It is highly unlikely that you will get a loan for a 100% percent of the project cost. You will need to put down a co-payment. Although the minimum co-payment varies by industry and lender, expect to put down at least 20%-30% or more of the cost of the project.
Step 2: Find out your credit score.
You should check your credit score and look over your credit report to make sure there are no problems. A credit score of above 650-680 is considered “Good”, but it does not mean you will get a loan. A credit score in the 700-800’s is very good and increases your chance of getting approved.
You can request your credit report from one of the reporting agencies, or use one of the many online services available to check your score.
Step 3: Start researching your options.
Start weighing all your options. Think of ways to strengthen your loan application. Can you find a co-signer? Bring in a partner with good credit or experience? Invest more cash into the business? If you think that you are not a strong candidate for a business loan, you can present the lender with options to increase your chances.
Step 4: Start writing the business plan and create the financial projections.
The business plan is more than a plan—it is a tool that helps you evaluate your business concept, your product or service, and discusses how to implement your ideas. A business plan is also a tool to obtain investors, lenders, and strategic partners. You can find many resources and opinions on the Internet as well as your local bookstore on how to build an effective business plan. A lender will usually require a comprehensive business plan as well as a projected 1-year cash flow projection (month-by-month), 3 years
Reward Power refers to the ability to deliver rewards or benefits to influence others. These can be financial, material, or psychological rewards. Reward Power is the fastest way to persuade.This power is the opposite of Coercive Power. With Coercive Power you punish, and with Reward power you offer incentives. Reward Power is based on utility, which is an understanding that in every transaction there is a potential for exchange. Basically, utility power recognizes that there is always something I want and something you want. We can meet each other's needs by swapping what we have for what the other wants. Prizes are a form of utility power. They are a way to reward people for doing what you want them to do. The reward becomes the incentive for compliant action. Examples of utilities include sales bonuses, paychecks, incentive clauses on contracts, bonus miles on airlines, and bonus points on credit cards.It is important to understand some incentives will work well with one person, but not with another. To some people, money is
The bank does not want to own your business. It is highly unlikely that you will get a loan for a 100% percent of the project cost. You will need to put down a co-payment. Although the minimum co-payment varies by industry and lender, expect to put down at least 20%-30% or more of the cost of the project.
Step 2: Find out your credit score.
You should check your credit score and look over your credit report to make sure there are no problems. A credit score of above 650-680 is considered “Good”, but it does not mean you will get a loan. A credit score in the 700-800’s is very good and increases your chance of getting approved.
You can request your credit report from one of the reporting agencies, or use one of the many online services available to check your score.
Step 3: Start researching your options.
Start weighing all your options. Think of ways to strengthen your loan application. Can you find a co-signer? Bring in a partner with good credit or experience? Invest more cash into the business? If you think that you are not a strong candidate for a business loan, you can present the lender with options to increase your chances.
Step 4: Start writing the business plan and create the financial projections.
The business plan is more than a plan—it is a tool that helps you evaluate your business concept, your product or service, and discusses how to implement your ideas. A business plan is also a tool to obtain investors, lenders, and strategic partners. You can find many resources and opinions on the Internet as well as your local bookstore on how to build an effective business plan. A lender will usually require a comprehensive business plan as well as a projected 1-year cash flow projection (month-by-month), 3 years
Yes, yes, we've heard it all before... loads of life coaches, consultants and therapists are struggling to make a decent living but still stick at it because they love their job.Want to know why nearly every coach or consultant out there will always struggle?...if you're one of them then you're not going to like this one little bit...It's a lack of CREDIBILITYBUT before you hit the DELETE key just bear with me...This lack of CREDIBILITY has a cause...lack of FOCUS.If I have a particular thing I'd like to improve in my life or business, wrongly or rightly, I will seek out and trust the advice of a SPECIALIST over a GENERALIST any day of the week.And that's the problem - LIFE, MARKETING and BUSINESS - is just too general.If you want to become truly attractive and have CREDIBILITY you need to stand for something. If you're a generic life coach then know this. People want to be able to turn to someone for a specific area of LIFE - this could be relationships, health, wealth etc.The same is true
Step 4: Start writing the business plan and create the financial projections.
The business plan is more than a plan—it is a tool that helps you evaluate your business concept, your product or service, and discusses how to implement your ideas. A business plan is also a tool to obtain investors, lenders, and strategic partners. You can find many resources and opinions on the Internet as well as your local bookstore on how to build an effective business plan. A lender will usually require a comprehensive business plan as well as a projected 1-year cash flow projection (month-by-month), 3 years income statements, a balance sheet, a statement of sources and uses of funds, and a loan amortization schedule. One mistake that we usually see is that the figures on the Business Plan do not match the figures on the financial projection. Double-check your work before sending it to the bank.
Step 5: Find a lender
Finding the right lender is not easy; each lender has its own criteria for lending. However you can use the list below to get an idea of what type of institution is a better fit for your loan needs.
a) Commercial Banks
Banks are one of the largest small business lenders but their approach to lending varies. Commercial Banks decisions are based on your strength as a borrower (a good credit score, personal financial statements, experience and collateral) the banks goals for the period and their lending philosophy. Banks may be looking to expand their small business loan consumer base; others may focus on larger loans or a specific industry.
You will need a high credit score if you are applying for a bank loan (with or without the SBA guarantee). Although, this is not an absolute rule for all banks, we found that a credit score over 700 is a better predictor on the success of a loan application. The bank may look for collateral (home equity, saving, etc) if you are applying for amounts over $50,000.
The borrower’s personal financial situation is key for the application. The bank’s underwriter will analyze the person’s net worth; as well as look at her previous earnings, length of credit history, among other factors.
For lower amounts the bank may not require a business plan. However, if there is a particular weakness in the loan application, the loan officer may ask the borrower to submit a business plan and financial projections.
b) Non-Bank lenders
These institutions do not conduct consumer banking but offer business services and business loans. Lenders’ requirements vary depending on the institution, and some prefer lending to specific industries. The Non-bank lender may take longer to process your loan application than a regular bank, but they can approve loans that banks find too risky.
Non-Bank lenders usually require a business plan and ample documentation with the loan application. Compared to banks these lenders have more flexibility working with lower credit scores as long as the borrower has the necessary experience and collateral.
c) Region specific Lenders
There are neighborhood specific for-profit/non-profit lenders that have more flexible lending terms. For example: Credit Unions and Community Development Organizations may lend to specific neighborhoods. The nature of your business and the reason why you are requesting the loan should fit with the organizations’ goals.
d) Micro and Alternative lenders Micro and Alternative Lenders lend to riskier borrowers. These borrowers usually have low credit scores or they are just building credit, also they don’t have a strong financial history and have little or no collateral. These institutions lend lower amounts and charge higher interest rates.
Step 6: Prepare the loan application package A “Loan Package” is the paperwork you submit to the bank in order to apply for a loan. The Loan Package includes the following:
• Business Plan
• Business Financial Projections
• Personal Financial Information
• Personal Tax Statements
• Information about business, location, sales contracts, etc.
• Business Owners’ Resumes
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