Forums: Discussions for entrepreneurs and small business.

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I am search for a reliable, honest and a trust worthy person to entrust this huge transfer project with

humm we recently got a loan from Capital One and they will go as high as 75% of your gross sales depending on exisiting debt.  One other major factor that we didnt realize is "risk" factor for the bank. How risky is it for the bank to loan YOU money. Depending on the business risks can be higher. We were promised x amount of  money when it came time to actually close on the loan the bank decided to reduce that money by almost half because they felt the risk factor was simply too high.

For the 10K mark your almost better doing a personal loan.

One more item I`d like to add. Accounting, yep you got it, we`ve all heard that there are two "books" one thats real and well one that we pay taxes on. Now if your planning on growing your business, it`s vital you add all income and simply pay the bill. Why because as banker said, banks will look at your tax returns and you want that number for gross income as high as possible to get the largest loan avilable to you. If your accountant is finding ways to show your making less or grossing less, that may be great today but down the road when you need a loan, you might be screwed.

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He who gets greedy like a pig, gets slaughtered like a hog!

If your accountant is playing with the numbers get a new accountant, pronto!

Thanks for the comments.

ToddF, my comments were regarding major retail banks. Your CapitalOne loan is suprising...75% is a lot of risk. I`ve called CapitalOne previously to get a feel for their loans, but the customers service reps were not able to answer some basic questions. For example, "What is the range of the interest you charge for a business?". I`ve heard good things about CapitalOne, especially their funding speed. Would you mind sharing the name of your contact there?

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I am search for a reliable, honest and a trust worthy person to entrust this huge transfer project with

I found your post very interesting.  I am wondering how you would guide me in my particular situation.

I have great credit.  I’ve paid off previous bills, and I’m paying my current bills on time.  But because of the current level of actual activity in my business, I want to expand my services.

This expansion has the potential to increase my bottom line.  But this expansion requires additional equipment and money that my business does not have.

Because I placed so much faith in my ‘great’ credit, I approached several banks and applied for a loan with a business line of credit for $350,000. 

I was informed, as a matter of fact, that because I am writing off all my expenses to the bottom line of my business, I did not qualify for this type of loan. 

The banks I approached were basically telling me that my business is not making enough income.

What existing small business loan resources cater to business owners in my position? 

I am desperately trying to keep pace with a highly competitive industry.

Thanks for the comment mattsind.

I don`t know enough about your situation to give you a complete answer, but feel free to drop me a line.

Its always good to ask questions and be completely upfront about your business and personal finances before applying because a decline does affect your credit. Any good banker should be tell you your chances of approval before even running your credit.

I`m curious if you applied for an equipment leased loan (secured loan) or a regular business loan (unsecured). Every business writes of expenses, so a decline for this reason may simply mean your business shows no profit. Ask for details regarding your declines and recommendations too.

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I am search for a reliable, honest and a trust worthy person to entrust this huge transfer project with

Yeah I`ll get it to you in a day or so, my wife handles that side of the business. FYI. this is not the first loan we`ve had from them so I know that does make a difference.

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He who gets greedy like a pig, gets slaughtered like a hog!

Here are two postings from my blog, Show Me the Money, that may offer insight into how to make a good funding request presentation.

What Will A Banker Ask Me?

Am I Bankworthy?

Thanks for the posts. They had a lot of nice info in them.

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Credit Card Counseling / Small Business Owner

At one point, I once believed that great credit was all that was needed too, when it comes to loans and lending money or assets of any kind.  This is really not the case. 

My experiences with banks and various lending institutions taught me that the business’ bottom line is a fundamental issue considered by today’s financial organizations as part of their loan approving process.  They need to be assured that you make enough money after your expenses to cover their loan payments.

Even though I had a great credit rating, I was still just not making enough money to secure the type of loan I needed, especially when these banks considered the amount I was requesting and saw that after I paid my expenses, there was not much finance left.

However, I did come across an ideal resource, www.thesnaploan.com.  This website seems to be millenniums ahead of its time, when it comes to current lending practices.  I was approved for a revolving line of credit that I can pay off and use again if I so decided.  I really love this option.  This website is a good place to start if you need an unsecured or secured loan, and you’ve been having difficulties elsewhere.