What Is Working Capital?

What is working capital? The definition that you will find in the dictionary is as follows...

working capital -1. The assets of a business that can be applied to its operation. 2. The amount of current assets that exceeds current liabilities. 3. Assets available for use in the production of further assets.

So what the heck does that mean? Well in average Joe or layman terms it means that it takes money to make money. It is a saying that we all know but few really understand.

Have you ever had and idea that you knew would work if you only had the money? Have you ever owned a business and just knew that if you have some extra cash available to really give you the boost that you needed to really become successful? You ever go to a restaurant and wonder how they could have possibly gone out of business because their food was great? I can go on but you get that point.

Almost every time I hear about a business going down or a restaurant being closed or of a business that just seems to be stuck it is usually due to a lack of working capital.

So what is the solution? Obviously we need to figure out how to get money don't we!

So what about a small business loan? Good luck! Statistically 92% of the folks that apply for a small business loan are declined. That is a staggering rate.

What about an SBA Loan? It can take up to 2 years to get approved and if you do you might as well have sold your soul!

Well there is a solution to those folks that currently run a business that accepts Visa or MasterCard. There is a new kind of financing available to the small business owner that gives them access to working capital that was never available before. It is called a business cash advance. Another term for it is factoring but on a much smaller scale.

How it works in a nutshell is that a company will purchase a certain amount of the small businesses future credit card sales at a discount and give them the money now and get paid back over time as they process those future sells. It has about a 90% approval rate and is a quick process usually less than two weeks to get completed.

So now what is holding you back from your dreams? What is holding you back from growing your business? What is going to stop you now?

Only you!

To find out more information about this kind of Business Cash Advance you can get more information here... www.advancedbusinesscapital.com

See you at the top,

Arnold Cortez (512-497-6204)

If you don't currently accept Visa or Mastercard but would like to get set up you can find out more information here.

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Getting A Commercial Mortgage

Although each lending institution has specific loan-application guidelines, they all evaluate business mortgages on two critical factors: the financial strength and stability of the borrower and the economic feasibility of the project.

You need to consult with a qualified commercial mortgage banker or experienced real estate finance professional before applying for a loan, but there are a few common questions small business owners can ask before they begin the process:

Where does the money come from? The U.S. Small Business Administration (SBA) offers a variety of mortgage programs administered through local and regional commercial banks. These programs finance new and existing properties, furniture and other assets. Additional sources include commercial banks, insurance companies and conduit lenders. Real estate portals such as PikeNet and LoopNet can also help you find financing and capital.

How much cash does it take? The down payment required to purchase property varies with each lender. To receive an SBA-secured loan, you must put down at least 10 percent of the purchase price. Commercial banks, conduits and insurance companies generally require you to put down a minimum of 15 percent.

How is the loan structured? Experts advise business owners to keep the mortgage separate from their primary business. In other words, form a separate business entity to lease the building to the operating company. Be wary of recourse loans: If you default on them, the note holder can seize the property and sue you for repayment.

What do I need? When applying for a mortgage, be prepared to show at least five years of operating statements. The terms and amount of the loan will be tied to the strength and stability of your business. The only way most banks will lend to companies less than five years old is if they can offer a substantial down payment.

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I did not write this article but I found it interesting so I posted it here.

Arnold Cortez
www.AdvancedBusinessCapital.com
Ph: 512-497-6204
Fax: 866-651-7782
acortez@advancedbusinesscapital.com