Every business has five major components necessary to operate. These are personnel, equipment, housing, products and services, and last but most vital, is capital. It takes capital to get the other four. Business owners often fear banks and commercial finance companies. This fear has its foundation in a lack of lender knowledge. A group7 Finance Consultant knows the ways of these lenders and has the contacts to secure financing for virtually any type of business.
The deregulation of the banking industry has made new choices available that never existed before. One of these is the availability of money through non-traditional lending sources.
The types of business loans vary to your specific business needs. Here are just a few of the loans that can be arranged by a group7 Finance Consultant.
Business Financing Products
Accounts Receivable Line this is a revolving credit line against a company’s eligible commercial accounts receivable only. It’s also referred to as a working capital loan, the borrowed funds being used for short term uses such as payroll, paying vendors, the utility bills, building rent, and so on. The money is paid back as business customers pay for their invoices. Banks secure these loans with all the assets of the business (sometimes excepting the business real estate), even assets they are not also lending on. The non-bank lenders generally use the eligible commercial accounts receivable only as collateral, leaving the other assets of the company available as collateral for other borrowings. Thus, on accounts receivable lines of $2,000,000 and more, your non-bank funded eligible accounts receivable revolving credit line will likely provide more cash on the same eligible receivables, often with more favorable terms and conditions than a bank. This means you get more control of your business than you could with a bank loan. If your company is going through spirited growth, you would take the non-bank funded revolving in order to be more profitable than you could be with a bank loan.
Asset-Based Loan an asset-based loan (ABL) is a loan secured by a blanket lien against all the assets of a company. The loan may be funded as one or both of two different types of loan: 1) a line of credit against eligible commercial accounts receivable, and 2) a term debt loan. Of the two, the line of credit against eligible commercial accounts receivable is the favorite of the ABL lender. This is the typical bank loan; the bank wants to control all the assets of the company in return for its advance. The bank will typically seek to maximize its collateral while minimizing its advance, so as to have a better outcome in the event of a borrower’s bankruptcy. Non-bank lenders often lend more on eligible accounts receivable than do banks, and for a longer period of time. Non-banks are often more flexible than are banks when it comes to the structuring of a company’s finances, welcoming other funders to finance other assets in which they are more expert than the ABLlender. This means that you can enjoy greater amounts of financing using non-bank financing than you could, using a bank. Non-banks are generally a far more stable lenders than are banks, less likely to call their loan, and more tolerant of a faster growth rate than is a bank.
Bank Replacement Financing this is not a criticism of banks, but is rather a commentary. The financing needs of growing businesses far exceed the capability of banks, given that banks are lending depositors’ dollars. Many non-bank financing products greatly exceed the capability of bank loans when financing many of today’s small businesses. Working with a group7 Finance Consultant, you will be able to replace bank financing with a selection of non-bank financing products, enabling Companies to perform and grow as never before. In time, your income statement and balance sheet will show the difference.
Commercial Real Estate if you are considering the purchase or construction of Commercial Real Estate, group7 can offer you up to 90% financing and have access to some of the most aggressive programs in the industry. With loan terms up to 25 years you'll be surprised at how easy owning Commercial Real Estate can be.
Equipment Lease companies don’t make money by owning equipment; they make money by hiring the use of equipment. Many items of equipment become unusable due to technological obsolescence long before they wear out. Other items have longer useful lives, but just cost a lot of money. Non-bank equipment leases will enable you to successfully manage the damaging effects of technological obsolescence on a company, while conserving cash for financing the greater amounts of business activity that result from installing new, productivity-increasing equipment.
Equipment leases can do things that would be inappropriate for a bank to attempt.
Factoring Facility rather than lending on a company’s eligible commercial accounts receivable, a factoring company will purchase the receivables. A factoring facility is far easier for a company to get than is an accounts receivable line. Once funded, the factoring facility is far easier (and sometimes is more economical) for a company to use and maintain than is a revolving credit line. Some factoring companies go beyond the basic purchasing of receivables, and will offer you a complete professional commercial credit department function to go along with it. Your qualifying company will be able to equal many of the largest enterprises in the area of commercial credit and accounts receivable effectiveness, by outsourcing this credit function to any of several factoring companies. Among other benefits, this can enable you to sell your products and services to business customers all across the US, (and, if you wish, Canada as well), without fear of bad-debts. Can your bank offer this?
Franchise Financing if you are considering the purchase of a franchise business or related business, group7 can help you achieve the dreams of buying your own business. Whether it is a restaurant, retail or service related business, a group7 Finance Consultant can help you achieve the dream of owning your own business.
Government Guaranteed Bank Loan over 90% of businesses is considered "small businesses" by the government's criteria. If your business has less than 100 employees and does less than $5 million in annual sales, a loan through the government guaranteed loan program may be your best option. group7 specializes in helping business owners navigate through the maze of government and bank paperwork.
Lines of Credit a line of credit can be one of the most useful financial tools for a small business. A group7 Finance Consultant can help you determine if this is the right transaction for your business. You will be guided through the transaction every step of the way.
Purchase Order Financing It often happens that a small business has an order for a product or service that is too big for it to fulfill, because to do so would require more cash than the company can borrow from a bank. For those situations that qualify, a purchase order financier will advance the cash necessary to fulfill the purchase order, and a factoring company will receive the customer’s payment. This is a very risky loan, and would be inappropriate for a bank to even consider. Yet, thanks to non-bank funders, you will be able to use it regularly.
Start-up Financing if you are planning to start a business, your best opportunity to obtain financing may be the assistance offered by our group7 Finance Consultant. Through the group7 network we have provided capital for hundreds of start-up businesses nationwide.
Term Debt Loan the term debt loan is a single loan made to a company, which is paid back over a term longer than one year. Principal and interest payments are usually made monthly, and can be set up with either fixed or floating interest. Although the loan can be used for a variety of purposes, its function is to finance the growth of the business. A non-bank funded term debt loan may be for a greater number of dollars than one from a bank. More structures are available from non-bank lenders, including versions of subordinated or mezzanine debt for qualifying companies.
A group7 Finance Consultant can give your business access to all of these types of financing and more. With one phone call you, can have dozens of lending sources competing for your loan. Once you have experienced the high level of customer service, competitive pricing and wide selection of financing options you will understand why many business owners view the relationship they have with group7 Finance Consultants as their most important asset.