Delivering Measurable Results

K. A. Lindow, CPA, P.C. CPA Firm, Phoenix, AZ.

Financing for Real Estate and Business Investing

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Financing for Real Estate and Business Investing

Business Loans - Funding Types

 

"We ran a search for capital on Sunday and had
four funding sources lined up on Monday. Thank you!"
Gary Reed - Lock-N-Stitch Inc.

 

Capital Type

Capital Type Definition

Account Receivable Factoring

Account receivable factoring serves as collateral for short term working capital loans that you can obtain fast and cost effectively.

Asset Based Loan

Seeking to convert a company assets into working capital. Giving a security in an asset(s) in exchange for cash.

Bankruptcy/Reorganization

Financing to reorganize in company in a turnaround. Typically secured by assets; equipment, inventory, A/R, PO's, etc.

Credit Card Receipt Advances

Up to a $50,000 advance against regular occurring monthly merchant credit receipts.

Expansion Financing

Growth has outpaced existing business. Loan for existing demand. Key here is existing demand, not projected.

Franchise Financing

Specialized financing reserved for the franchisees of recognized, typically nationally known, franchises.

Import and Export

Loans to promote the shipping or receiving of products or materials. Based on existing market, demand or orders.

Inventory Loan

A loan typically made as part of a relationship where the lender will also provide retail financing for the product.

Purchase Order Financing

Loans on the written order to purchase goods at a stipulated price with an agreed to delivery date. Credit rating of orderer is key.

Secured Credit Line

A pre-arranged amount of credit based upon existing inventory, A/R and PO's.

Unsecured Credit Line

Up to $200,000 in business credit based upon credit worthiness.

 

Commercial Mortgages - find the funding you need

"We closed a deal and found two
new brokers in just 15 days!"
Caroline Ogutu - Actrade Capital, Inc.

Capital Type

Capital Type Definition

Acquisition and Development

Raw land infrastructure development (streets, utilities, etc.)

Adjustable Commercial Mortgage

Interest moves with a specific index (Prime, T-Bills, etc.)

Construction Mini-Perm

Construction with 3 to 5 year loan, usually on income property.

Construction Loan with Take-out

Construction with pre-arranged takeout loan in place.

Fixed Rate Commercial Mortgage

Interest Rate remains constant throughout the term.

Hard Money Loan

Loans from private lenders based primarily on the hard asset value (commercial building, vacant land, etc.).

Interim Loan

A short term (2 yrs or less), bridge or project type loan.

Joint Venture

A financial partner in the development of real estate.

Participating Mortgage

Lender receives a kicker for gross income above a preset level.

Real Estate Sale and Leaseback

Lender purchases land and leases back to borrower (generally developer) for a fixed rent plus other considerations. Mortgages are issued on leasehold at market rates. Usually, produces more dollars than a mortgage.

Real Estate Purchase Loan

Lending for the purchase of commercial real estate.

Second Mortgage (Commercial)

Loan secured by equity behind that of the first lien.

Wraparound

Lender makes a second mortgage and assumes the first mortgage.

Equipment Leasing – find the funding you need

"Very Impressive. Your service opened the doors for us to get the money we needed."
Allen Morrell – US Publishing, Inc.

Capital Type

Capital Type Definition

Financing

Making of a loan using the equipment as collateral. Good operating history, credit rating, debt ratios are the keys.

Leasing

Contract for a fixed period of time in exchange for payments, usually in the form of rent for equipment. Typically lower credit requirements.

Sale and Leaseback

Sale of an asset for cash, with a contract to lease the asset back from the funding source purchasing the asset. Sales tax an issue here.

Government loans - funding types

Government Loans from the SBA - Small Business Administration loans can be used for most business purposes.

"From the day they ran their capital search to the
day it closed for $250,000 was two weeks!"
Doug Hood - Rainmaker Capital Corporation

Capital Type

Capital Type Definition

7A: SBA Loan Guaranty

Loans to small businesses from private-sector lenders (banks, etc.) which are guaranteed by the SBA. The SBA has no funds for direct lending.

Certified Development SBA 504

Loans to small businesses with long-term, fixed-rate financing for major fixed assets, such as land and buildings. CDCs work with the SBA and private-sector lenders to provide the financing.

Federal Export Assistance Loans

Export financing of U.S. goods and services through a variety of loan, guarantee, and insurance programs. (Ex-Im Bank Programs)


Tax Due Dates