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September 9, 2017.  Please review articles as needed as a resource.  If you determine a need for financing,
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Bad Credit – Fix it or wait it out?

October 13, 2017.  You have bad credit.   Maybe even very damaged credit.    People all over the internet tell you to fix it, what to fix, how much to fix, and how fast to fix it.  But the question remains as to bad credit – fix it or wait it out?  Sometimes credit should be fixed, and sometimes it should not. The premise of always fixing bad credit needs to be reviewed.

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Bad Credit – Fix it or wait it out?

Cases when damaged credit should not always be fixed

Joint Accounts

You have joint accounts with someone and they are not paying them. Have a conversation with them.  Trying to fix that bad credit right away is premature.    If a Partner or Spouse was responsible for paying an account and does not, it will damage your credit if it is a Joint account.   There may have been a household verbal agreement that the Partner or Spouse was responsible. That does not matter on the credit report.   Late payments will show up for both of you.

Other questions first need to be addressed. Will you stay with your Spouse or Partner and are they communicating and working with you on the non-payment?
If you are not working together, then there is not much point to try fixing the credit right away.  Closing the Account may be the first step. If they are working with you then make a plan on whether or not it will be paid, by whom and when. Decide if you want to keep the Account open. Then later, derogatory reports can be disputed.   These issues need to be handled differently if the derogatory credit issues are with a business partner.

The bad credit is already old

Bad credit, late payments, charge-off’s, foreclosures, and other derogatory items on your credit that are already 5 years old or older are not worth the cost and effort to try to remove them.  This includes 30, 60 and 90 day late reports.   After 7 years, many items drop off automatically. For those items, it does not make sense to manually try to remove them.

Bad credit - Fix it or wait it out?
Bad Credit – Should you even try to fix it?

Federal and State Tax liens

These are much harder to remove.  It is also much easier to pay them and get a statement of “released” placed on the bureau just below the item rather than trying to get Tax Liens removed. If you have a payment arrangement, keep a copy of the payment arrangement and provide it to anyone that will look at your credit report.  Tax Liens on which there is a payment arrangement are looked at far more leniently than Tax Liens that do not have a payment arrangement in place.

Looking at some of these issues can help you decide on bad credit – fix it or wait it out?

Top Reasons business loans don’t close

Top Reasons business loans don’t close

October 13, 2017.   Today we will consider the top reasons business loans don’t close.   We will review the most common reasons and how to avoid them.    Applicants can get their loans closed by preventing these problems.

Not being able to Prove Ownership

Business owners sometimes have trouble proving ownership of their business.    The Secretary of State often lists the Registered Agent and Officer, but does not list or clarify who the owners are.   Officers to not have to be Owners of the business.   Another problem is that ownership percentage is not not listed.    Owners often have to provide their Articles of Incorporation or business license to prove ownership, which many times they do not have on hand.

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Not being able to provide proof of the existence of the business

Some States do not require a business license to operate a business.   The owner will operate the business in their personal name and say they run a business.  They will not be able to get a business loan because they cannot prove the existence of the business the way Lenders require it.

Cannot prove time in Business

Businesses often begin as a Sole Proprietorship or Partnership and Incorporate later.
When this happens, the Secretary of State will only show the time in business since the time of the Incorporation.  The time the Company was a Sole Proprietorship or Partnership will not be added.
For example, if a Company was Unincorporated for 3 Years and has been incorporated for 2 Years, it will only show on the Secretary of State as 2 Years Time in Business.   If the Company wants credit for the full 5 years, they should provide the business licenses since it began as a Sole Proprietorship.   Lenders will give the Company credit for the full 5 years.

Top reasons business loans don't close
Top Reasons Business Loans Don’t close

Business Account balances are too low or overdrawn at the time of closing

After a business is approved for a business loan, their Business Checking account may be reviewed before closing.  This will include a review of the current balances, the Month to Date balances, NSF’s and Overdrafts within the last 30 to 60 days.   If these are too negative, the Lender may withdraw the approval.   Review your balances and activity to make sure this will not impact your approval.

Cannot pass bank verification

Many business loans require a verification of the business bank account.   This is often done through 3rd Party Vendors such as DecisionLogic, and Joinme.  Bank verification can also be done through phone verification.

The business cannot provide all of the documentation required in the closing stipulations.

Business loans have a list of closing requirements that have to be met. If the applicant can get most of them but not all of them, they may not be able to close the loan. If you fall short in getting the Documentation required to close a business loan, talk to the Lender about what is missing. You may be able to get the remaining items waived. Another option is to provide substitute information.  Many times alternatives to what was asked for may be accepted.

Avoid these problems and you stand an excellent chance of having your business loan close fast.

Top 12 customer complaints with Business loans

Customers have several common complaints about Business Loans.   We will take a look at the Top 12 customer complaints with business loans.  Customers often do not close an approved business loan because of one or more of these reasons.

Top 12 customer complaints with business loans:

The rates and cost is too high.   They want a better rate and terms.

Customers often want and need a business loan with a lower rate and better terms.
Another requirement is they need a business loan with lower total repayment and lower cost overall.

The Approval was not for enough.

Customers often call in and say they need a higher approval amount and more money
for my business loan.   They will go for a different loan if they cannot get what they want, or also get a second loan.

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Top 10 Customer complaints with Business Loans
Top Customer Complains with Business Loans

The term of the loan is not good.

Customers also say the term is too short and needs to be longer.  Another requirement is a business loan longer than 24 months.

It is not a Monthly Payment.

A very frequent request is to get a business loan with a Monthly payment.   Customers really want a Monthly payment if they can get it.

It is a daily payment.

Applicants will say right away if they do not want a business loan with a daily payment.   They have had this type of business loan in the past and they will not close business loans that have a daily payment.

It is a Merchant Cash Advance.

Customers oftentimes do not want a Merchant Cash Advance.   They will say they need a business loan that is not a Merchant Cash Advance.
When this is the case, the customer will look for alternatives to a Merchant Cash Advance.

The Prepayment option is not good.

Another complaint is they want a business loan with no prepayment penalty.   They want to be sure they will get a good discount if they pay off early.

The type of loan is not what they wanted.

Sometimes customers will tell you they don’t want the type of loan they have been approved for.   They do not want an expensive business loan or want a different type of business loan.  They are not sure what type they want, but they have decided they don’t want the one being offered.   Have a conversation about other business loan types so Customers will get the loan that works for them.

They don’t want to put up Collateral.

Many do not need or want a business loan with Collateral.   They do not want to put up Collateral, or they do not have Collateral.

Do not want to give a Personal Guarantee.

Customers may not want to close a business loan with a Personal Guarantee.  They believe they can get a business loan with no Personal Guarantee.    There are very few business loans that do not require one.

The loan will, or will not be reported on Personal Credit.

A business loan that reports on Personal Credit is sometimes requested.   Applicants insist on a business loan that reports on their personal credit.

In other cases, customers want the opposite.   They want a business loan that does not report on Personal Credit and want to make absolutely sure there will be no reporting on their Credit Bureau.

The request took too long.

Some business loans that are eventually approved do not close because the processing time was too long.   Customers will tell us they need a Fast business loan that does not take long to get.

These are the Top 12 Customer complaints with business loans.   If some of these are causing you problems and also preventing you from closing, contact us and we can review your requirements.

Landlord Contact Information

Definition:  What is Landlord contact information?

October 5, 2017.   Landlord Contact information is the Name, address and Telephone number of a person or business’s Landlord.  It is used to verify personal residence or a business location .

Examples of Landlord Contact Information: 

A business owner applies for a business loan and is approved.  One of the closing stipulations is to get Landlord Contact Information. If the business owner is asked to get this, they can consider other types of business loans that do not require it.
To get a business loan without providing this, contact us below at SmallBusinessLoansDepot.com for other options.

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Did you know?

Customers do not always have this contact information. What to you do if you are a Home based business and are being asked for this information?   What if you are also the owner of the property and it is paid off?

Let the person requesting this information know you own the property and also if it is paid off.    If you are Home Based, let them know this.   Being home based is often acceptable and you will instead be asked for other information to satisfy this requirement.

This information is requested for many reasons.   Most often when someone is requesting a product or service, and also entering into a Contract.

Landlord Contact Information
What is Landlord Contact Information?

Requests and statements by callers below include:
Why am I being asked for Landlord contact information and what
should I provide?
Give whatever information is asked for.   If you are not sure why it is being requested, ask why.   Sometimes a Lender will try to call the Landlord as part of a personal loan or business loan request.  Ask the Lender if they will call your Landlord.   If so, give your Landlord a heads up to expect a verification call.   Many loans are delayed because they don’t know they will be getting a call.

 

Learn more about Landlord Contact information.

Recent examples from the Web:

Types of Emergency contact requests:

Payoff Letter

Definition of a Payoff Letter.  What is a Payoff Letter?

September 21, 2017.   A Payoff Letter is a letter that is required often by a Lender proving that other loans the borrower had are paid off and have a $0 Balance.

Examples of a Payoff Letter:

– A request to show other small business loans are paid off.
– A request to verify that a credit card is paid off.
– A Letter showing that a similar type of loan has a zero balance and is paid off.

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Did you know?

These Letters are also called a “Zero Balance Letter”.   They are often referred to this way to emphasize that the Letter needs to show that the balance is Zero.

Why are they requested?

Lenders may want to make sure that certain loans are paid off in order for them
to be willing to approve and fund a new loan.

Payoff Letter
What are Payoff Letters?

Customers cannot always provide this letter.
Sometimes customers are not well versed in this field.  Another reason is they also don’t like getting paperwork together and are unsure how to do it.   Customers also see it as a burden that they do not have the time or desire to deal with.

How to Handle a Payoff Letter request:

If a Lender asks you to provide a Zero balance letter, find out which Institution it is.
If you have more than one loan with that institution, get the Account number to make sure you will be getting the information for the correct account.    Once you have this information, call the customer service number for that Lender.

Tell the Representative what you need and they will transfer you to the correct department.  Most Companies have specific Departments that handle this type of request.   You will be routed to that Department and they will provide the Letter.  In most cases you will receive the Letter in 2 to 4 hours.

If you have been asked for this type of Documentation, call us to discuss.   Explain what you are being requested to provide.   There are other Financing products that do not require this and other forms of verification.   You can apply for other Financing options and avoid having to provide this type of Documentation.

The following are frequent requests and inquiries by Callers.   How are they addressed
and handled?
– Need a Payoff Letter for a Business Loan.
– How do I get a Payoff Letter?
These issues and Questions have been addressed above.

Learn more about other types of request for proof of Documentation such as
Proof of income.

Recent examples from the Web:

Therapeutics Corporation entering into a Payoff Agreement and Letter.

Copy of Business License

Definition of a Business License.  What is a Business License?

September 19, 2017.   A Business License is a Certificate issued by a City, County or State Government to a business it can use as verification of it’s existence and to legally operate in the jurisdiction it is located in.  Another purpose for a copy of Business license is that it is required for numerous types of Business Transactions.

Copy of Business License

Examples:
Business Licenses fall into certain Categories.
– General City or County Business license.
– Professional Licenses.
Professional licenses are often in addition to professional licenses.   Examples of these are Medical Licenses, such as a Physician, a Dentist and a Chiropractor.   Other types of Professional Licenses can include certain types of Construction, Engineering, Real Estate Agents and many more.
These types of Professional licenses are often in addition to a standard business license that is required by the City or State.

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Copy of Business License
Ways to show a Copy of a Business License

Did you know?

Some business legally operate without a Business License?
Some States do not require a business license to legally operate.   States may allow, but it can make operating much more difficult for the business.   Other businesses that require a business license to do business with them will not waive their requirement.  It will not matter to them if the State does not require it.   They will still require one.

The following are frequent Questions, requests and statements:
– “I do not have a business license”
–  “Need a business loan with no Business License”
If you do not have a business license, it is recommended to get one.   If your business was a Sole Proprietor, save all of the old Business licenses that you had.

Learn more about Business Licences.

Recent examples from the Web:

Consequences of not having a business license.

Voided Business check

Definition of Voided Business Check.  What is a Voided Business Check?

September 16, 2017.   A Voided Business Check is sometimes required to close a business loan or to complete other types of transactions related to the business.   If this is required and your business does not have standard business checks, ask the lender if there are alternatives.

Examples of a Voided Business Check.

Example of a Voided Check.  This is also referred to as a voided business check.   The Account Holder takes a check and writes in large font,  “void” on the check.    They can then take a picture of the check and send the picture as a .jpeg, or .png file, or .pdf file.

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Did you know?

Businesses are writing far fewer checks than in the past.  ACH payments, incoming and outgoing wires and debit card transactions today make up a significant number of the payments that businesses used to write checks for.   Some business do not have nor write standard business checks any longer.

Voided Business Check
Voided Check

What can you do if the Lender  is asking for a copy of a voided business check and you do not have any?  What options are there?
– Ask the Lender what other options they offer.
– Lenders have some of the following options:
– Bank Verification.   Through this secure option, the Lender can look at the Account holder’s account and verify the validity of the account.   The Party looking at the account
cannot access the account as well as cannot make any changes or any transactions.

Callers often request and call in with the following:
– I do not have a voided business check, what can I use?
– How can I get a voided business check?
The only way to get a voided business check if your business does not have any is to
order checks the traditional way through your financial institution.    In most cases if the checks are needed quickly, expedited service can be requested for an extra $20 to $40.
If you do not have the time to order checks and wait on them, you may want to let the funder do a secure bank verification.   A bank verification is often required anyway, and
It may allow you to get around this requirement.

Recent examples from the Web:

How to void a check using Quickbooks

 

Proof of Ownership of the Business

Definition of Proof of Ownership.  What is Proof of Ownership of the Business?

September 16, 2017.   Documentation a business can show as evidence
or proof of ownership of the business.

Examples of Proof of Ownership of the Business.  

A business owner applies for a business loan and is approved.
One of the closing stipulations is for the Owner to provide Documentation of Ownership of the Business.  The Business Owner does have a few options in providing Evidence of Ownership of the Business.   They can also provide:
– Current Business License.
– Articles of Incorporation and a Partnership agreement.
– K-1 of the most recent Business Tax Return.
– The most recent Full Business Tax Return.

If  you cannot provide the types of documentation of Ownership required for your business loan,  contact us below at SmallBusinessLoansDepot.com for several options.

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Did you know?

Sometimes Business Owners cannot provide the types of Business Documentation of Ownership required to close a business loan.
What can you do if you do not have the specific proof of ownership the lender is asking for?  There are other options in addition to the ones listed above.   Call us to discuss and we will offer you other options.

Proof of Ownership
What is Evidence of Ownership?

Evidence of Ownership is often required.   The person applying in the name of the Company needs to prove they are the Owner.   This prevents other people from getting Loans in the Company name that are not authorized to do so.    It also can help break down the Ownership percentage if there is another Owner.

The following are frequent requests and statements:
– What do I need for Proof of Ownership.   I don’t have it and
also cannot provide it.

Learn more about Proof of Ownership.

Recent examples from the Web:

Visit other resources on our site to get information on Ownership
questions or issues.

 

Proof of Income

Definition of Proof of Income.  What is Proof of Income?

September 16, 2017.   Proof of Income is documentation or other evidence that is used to prove the income of an individual or business.

Examples of Proof of Income: 

A business owner applies for a business loan and is approved.
One of the closing stipulations is to show Evidence of Income.  The following is a list of most accepted forms of proof of income for businesses and individuals:
Tax Returns
Pay Stubs or W-2 Statement
Bank Statements
Financial Statements such as Profit and Loss and Balance sheets

If a business owner cannot show Documentation of Income, they should consider other types of business loans that do not require it or for which background information on the applicant is not heavily scrutinized.  To get a business loan without Proving Income,  contact us below at SmallBusinessLoansDepot.com for several options.

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Did you know?

Customers cannot always show the type of Documentation of Income that is being requested.
What if you cannot provide Document your income?

There are other funding Options.   Call us to discuss these options.

Proof of Income
What is Proof of Income?

Evidence of Income is requested for many reasons.  Most often they are completed when someone is requesting a product or service, or entering into a Contract or Relationship with someone else.   They are not always looked at the same way.   What is looked for is totally up to the party that is pulling the report and also what they decide about the information.

The following are frequent requests and statements:
– I do not have Proof of Income.  What can I do to provide what is needed?   Other ways to show evidence of income sending Bank Statements.  If all of a person’s income goes into 1 Account, then the most recent bank statements for that account may be used to prove income.  This can be done for a business or an individual.

Learn more:

Recent examples from the Web:

Evidence of Income

Contact us today for program options.

Favored Industries

September 16,  2017.

What are Favored Industries?  Definition of Favored Industries and Preferred Industries:

Favored Industries are industries that are more desired and sought after by businesses who try to establish relationships and provide Goods and Services to them.

Examples of Favored Industries and Preferred Industries:

Automotive Repair, Dentists, Dental Practices, Physicians, and Medical Practices, as well as  Beauty Salons, Gift, Novelty, and Souvenir Stores and Shops.    Additional businesses likely to receive approvals include Restaurants, Electrical Contractors ,Furniture Stores, and Chiropractors.
Plumbing, HVAC Contractors, Hotels, Sporting Goods Stores, Grocery Stores, Gas Stations, General Merchandise Stores, Bars,  Nail Salons, General Retailers, as well as Electronics Stores are also considered Preferred or Favored.
Food and Health Care Stores, Clothing Stores, Cleaning Services, and Veterinary Services are also considered more desired businesses to market to.

More Favored Industries

Another group includes Home related businesses, such as Home Health Care Services, Home Furnishing Stores, and Hardware stores.
Optometrists, Automotive Parts and Accessories Stores, Beer, Wine and Liquor Stores, Hardware Stores, and Jewelry Stores.
Other Favored industries, Target Industries or Targeted Industries include:
Supermarkets, Grocery Stores, and Convenience Stores.

If your business is not considered a Favored Industry or Preferred Industry and
you need financing, contact us below.

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Optometry Centers, Glasses and Contacts
Party Supply Stores, Pet Merchandise, Pharmacies, Specialty Stores or Specialty Department Stores.   Sporting Goods Stores, Toy Stores, Hobby Stores and Pet Shops.
Barber Shops, Beauty Shops and Beauticians.
Dry Cleaning  and Laundry, such as Coin Laundry.
Hair, Nail and Skin Care Stores,  and Health Spas are all more Examples of Favored Industries.
If your business is considered a Favored Industry or Preferred Industry, other businesses will cater to your business more than to other business types in other industries.   Another advantage is getting better Terms on Goods and Services.

Favored Industries
Information on Favored Industries

Frequent request for assistance has been by those stating the following situations:
– “What is a Favored Industry?”.
-“What is a Preferred Industry?”

Learn more about Preferred Industries.

Recent examples from the Web:

Loans to Preferred Industries