Commercial Loans and Business Plans Considered

It’s not easy to write a business plan, but it is paramount that entrepreneurs do so. For instance, consider if you will the type of folks who are entrepreneurs – gregarious types of individuals, who are probably not very good with the fine details as accountants are. Therefore, they often have trouble preparing business plans. Nevertheless they need to do this so they understand what they’re getting themselves into, and evaluate their potential business opportunities appropriately without allowing their optimism to run away with the game.

Over the years, since retirement, I have helped various entrepreneurs in their businesses, and often they need to get funding or financing to start these endeavors, so they go and look to get a commercial loan. The bankers know that entrepreneurs aren’t very good at writing business per-startup plans, so generally they except business plans which are half baked, or in the case of the small business administration, they have a form which is filled out by the entrepreneur in place of the business plan, it’s about 13 pages.

However, a decent start-up plan could easily run 40 pages including the proformas in the back. It seems to me rather than making it easy for entrepreneurs to get commercial loans and therefore requiring less than adequate business plans – that we should be moving in the other direction, stipulating that the business plans the very well done. Indeed as a taxpayer I am concerned that my tax dollar will subsidize the SBA loan program. And many of these loans fail, but right now the taxpayer and SBA guarantees 90% of the loan with the local banks which make the SBA loans.

Since the bank has very little risk because the government is guaranteeing 90% therefore they are only on the hook for 10%. Are you beginning to see the problem with this? If entrepreneurs and small business people can’t prepare start-up plans, and they aren’t sure what they’re getting themselves into, why an Earth is the SBA and commercial business banks providing more rope for these future business owners to hang themselves with? Indeed that makes no sense at all does it?

Perhaps, this is why I often tell entrepreneurs to create a business startup plan, then look at the real numbers, and play devil’s advocate a little bit against their overbearing opportunistic enthusiasm and hyper drive optimism. Indeed, I hope you will please consider all this and think on it. If you have any questions, comments, concerns, or even case studies, I would be glad to hear about it. Please shoot me an e-mail.

What Is Online Loan and How To Get It

These days’ online loans are getting more and more popularity among the people. To solve the problem within a short period one can easily apply to these loans and get the maximum benefit from it. People who work in offices can easily take the help of online loan facility and solve the problem without any tension and stress. To manage household finance and other related personal problems, people are inclined to the facilities of such loans, and get instant help for the solution of their problem. It has many beneficial effects and hence provides a great advantage to the people.

This facility does not include any documentation process. All the necessary information that is required by the lender is included in the online application form, and this is the only prior thing that the borrower has to do to get the cash. It avoids long process of documentation and speed up the online loan process and helps the borrower instantly. Therefore, you can easily rely on this process and get cash at fast speed.

In online loan process, there is no tension of credit check. In this process lender only, look into the borrower’s ability to pay the loan money. The lender looks whether the borrower is employed alternatively or not. They also crosscheck the bank account of the borrower where the monetary transaction will take place and once they get satisfaction on all the essential requirements then they can forward with a next step. This verification helps both the lender and borrower to get all the information about the process and hence satisfy them fully.

Online loan facility has given many opportunities to the people, and it is one of the most convenient processes to get cash to meet up your emergency need. To get online loan one has to follow very simple process or steps to get the cash.

- The applicant have to fill up the online application form.
- The lender of the loan will confirm the form instantly
- The lender will transfer the amount to borrower’s monetary bank account
- Lastly borrower can access the money on the very same day

Following the above mention steps will provide you the money instantly and when you get your salary then you must repay the loan to the lender without any fault. This process is very secret and confidential, and it remains between the lender and borrower.

Online loan facility is one of the best options for people who want the cash instantly for any emergency. It is available twenty-four hours for seven days. The online application form is prepared to keep in mind the convenience of the borrower. The interest rate is relatively high, but in a way, it helps the borrower to get the money at fast speed without any problem. Both borrower and the lender should undergo little research on the online loan process so that they can take the maximum advantage of this process and they do not waste their money and use them for fruitful purpose.

Commercial Finance Funding and Identifying Zombie Banks

In the world of business finance funding, the colorful terms “Zombie Banks” and “Dead Banks Walking” have been applied recently to a number of commercial lenders. Although these discussions have an element of humor and entertainment, there is a practical aspect to them as well. Ultimately it is not likely to be in the best interest of a business owner to have extensive involvement with any of the banks which these terms describe accurately. In any case it should be beneficial for commercial borrowers to understand what constitutes a zombie bank and what they should do if they are working with a dead bank walking.

For any business owner currently needing a commercial loan or working capital financing, the concept of “Dead Banks Walking” is likely to be an essential part of their decision. This description has been used by several sources recently, all with a similar reference point of banks which have already gone broke. This critical but apparently accurate assessment is largely derived from a straightforward net worth approach. Such an analysis recognizes that many banks have substantial assets which are either worthless or at least worth well below the values reflected on their books, with the resulting real current value being less than the current debts of many banks.

Based on the evaluation of many observers who have realistically reviewed current asset values, most of the largest banks in the United States been shown to be worth even less than Lehman Brothers (which is already in bankruptcy). Many banks have compounded their public relations nightmare by demonstrating very little common sense in how they make commercial loans and spend money. If a bank is already worthless, it certainly calls into question how businesses and commercial borrowers will benefit by the government throwing money at these “zombie banks” in the first place. This controversy has been fueled by the failure of most banks to increase their commercial lending to business owners after receiving government bailout funds. Banks who have received bailout funds appear to be determined to hoard the money in order to preserve their own solvency rather than providing commercial finance funding to commercial borrowers.

This raises several questions. The emerging consensus is that giving otherwise bankrupt companies (the dead banks walking) more cash does little more than cover the internal operating expenses for the zombie banks.

First, should we really believe that a bank should be “saved” simply because it is so large? There appears to be a growing majority of the public which would suggest that these banks have already lost too much good faith to ever recover in response to some arguments that the largest banks cannot be taken over even if they are already insolvent.

Second, is there a better way to solve the problem than giving insolvent banks more money? George Soros and others have recently described in detail how other banking systems have successfully handled mortgage financing. Even though residential and commercial real estate loans are thought to be at the heart of the current crisis, there is no real effort underway to revise this approach.

Third, can business owners really afford to wait for the government to solve this problem? Although waiting a few weeks or even several months might be viable for a practical solution which results in needed commercial loans, the current logjam impacting business finance funding shows little evidence of subsiding that quickly. Prudent commercial borrowers should seek alternative sources for essential working capital financing such as business cash advances. In case it is not obvious from the discussion above, dead banks walking and zombie banks can be avoided when seeking new commercial financing.