Hello everyone and welcome to today’s webinar, today were going to be covering everything that you should know to secure business financing, were actually going to be talking about at least 7 different thing that you should know, to be able to obtain business financing, were going to kinda give you the ins and outs, the reality is there’s a lot of money that’s available right now, but a lot of people don’t know how to get it, it’s available at alternative lending sources that are outside of conventional banks and a lot of people just aren’t sure if the process to go through, so today were going to dissect this process everything from looking at an application to breaking down the kinds of funding that’s actually out there I’m want to walk you through this process hopefully with the, by the end of this webinar within about an hour you’ll be able to then know exactly how you can go about getting funding for your business whether you start up, whether you have credit challenges, whether whatever your situation is, there’s a lot of funding or even business credit the funding doesn’t apply it’s failed, so before we dig in let me introduce myself, my name is Ty Crandall I’m the director of business services your credit suite. What we do is we do a few different things we help customers get funding, we help business owners get business credit and we also help people that are interested offer business credit and funding as a service, there’s not going to be sales pitch this webinar today that’s all you’ll hear about what we do, so if you’re interested in learning more you can check us out there’s a website creditsuite.com /businesscredit and that will give you all the information about offering business credit of financing service, and you can even get in touch with us through our phone number, e-mail address right there, and we can help you with getting business credit or financing of your business for helping others do the same, so my experience, I’ve got a 16 years of financial experience. I’ve been in business credit field for many years now I’m probably one of the most well-known authorities in the business credit space, our organization has helped thousands of thousands of customers obtain credit and finding, and financing, so I know a lot about this, and this webinars really about what I’ve learned and about how you cannot make mistakes in going through this process because you know what we found is that there really is a clear cut process to applying and getting funding, and if you know this process upfront it you still have a much better chance to be able to go through the process actually apply and get approved, so let’s jump in. First of all let’s talk a little bit about the difference types of business financing, well there’s a lot of different types of financing it’s out there, and I want to start with credit lines, because credit lines are really one of the most popular kinds of funding that’s out there, it’s by far the most commonly requested types of funding that’s out there almost every customer we talked to wants some form of credit line. So credit lines are what most business owners really want access to, they’re also one of the hardest types of financing to actually qualify, now to get approved for real credit lines you have to supply business financials in almost all cases, so there are business credit cards that that you going to learn, through this webinar that you can get in credit cards, and credit lines don’t have that much of a difference between actually being able to get cash out, and credit cards provide better intro rate like zero percent intro rate. But if you’re talking about the real credit line for 50 grand 100 grand 250,000 you’re going to need to be prepared to supply financials, if you’re looking for a credit card with a limit at 10, 20, 30,000 you can get that without financials, but if you’re talking about an official credit line that you can use with higher limits 50 to 250,000 plus you’re going to have to supply financials on those cases, usually they’re going to want tax returns for the last 2 to 3 years, okay you might this also be ask for profit loss statements, current, projected, bank statements, a business plan and more, these are closer to full documentation kind of deals, of deals, they’re harder to qualify that a lot of alternative financing it’s out there but they are definitely available, I don’t talk about them a lot because they are so hard to qualify but they’re definitely available you just have to provide tax returns, your tax returns have to be solid, you have to be showing good net profits, if you meet that criteria you stand this a chance of a actually getting approved. Now your approval amount will based on the profits you show on your actual tax returns, so your tax returns also should show you have increasing profits, so they don’t want to see that from year to year, you’re decreasing your profits and decreasing your sales, they’re looking to see that from year to year your sales are increase from year year before, and so are your profits so you’re bit personal and business credit will also be reviewed when your applying for credit lines and both should be good to get approved, now don’t get me wrong, okay don’t get discourage because we’re starting with the hardest kind of financing that’s out there to qualify for, were about to dive into lot of different kinds of financing were you don’t need all this criteria to get approved, but again as I said the beginning slide, credit lines are one of the hardest programs to qualify and get approved for, so you do the tax returns, you need to have personal credit they will even look at your business credit to see if you have establish business credit, and lenders like to see that you have open credit lines now they have very high limits, that’s really when you’re talking about business credit cards, when you’re talking about business credit lines, your approvals are going to mimic your current limit account now, current limits account now, so if you have $20,000 credit limit or credit card now then that makes it easier to get approved for a $20,000 credit line so if you’re going in and applying for a $250,000 credit line and all you ever had is a credit card $3,000 limit that’s a hard sell it’s very risky for the lender that lends you that much money when your credit doesn’t reflect to responsibly handle that kind of limit before, they might give you something closer to the limit that you have but again don’t get me wrong a lot of this goes off your net profits, it’s just one of the things that do want to see is that you have a history of maintaining higher limit revolving type of accounts, and approval limits approval amounts might also be late to your existing limits now just I mention, so on top of being linked to your net profits, they are going to also look to to see what these high limits are that you maintain before and the past, and you also might see approval limits similar to those first step profit in some cases. So another types of financing our business loans, a business loans are available a lot of places including SBA loans offered from regular conventional banks, many lenders also provide business loans outside of your conventional banks, and some other types of collateral based financing also offer loans such as book of business financing for insurance agents, so there’s a few different way you should could really get business loans, you can go into your bank, Bank of America, Chase whoever it may be, you can go through alternative lenders, private investors you can have actual business loans, you can even have to find some kind of collateral based financing has business loans, some of those are loans their advances, their credit lines they’re all different kinds, but some collateral based financing will also offer business loans a perfect examples a book of business financing for insurance agents, this kind of financing has three to five year loan terms the most insurance agents go with that are to unsimilar from what you find with SBA. Many loans are shorter terms typically 3-5 years, example I just gave you, others might go as long as 20 years or longer, this might be an SBA higher amount million two million dollar type of loan, now rates vary radically based on risk, so with some being 2% over the prime rate and others being as high as 10% so rates were really fluctuate on loans depending on what kinda collateral you have the other risk factors involved with actually obtaining loan, so to get long loan terms you almost always need financials and in many cases you going to need collateral, okay this is very high risk for me for somebody to give you five, ten, twenty year loan, your which what you want to have the lowest payments, you’re going to have to have financial, you going to have to have collateral as a matter of facts for a lot of loans beyond collateral base loans you’re going to need this stuff anyways, but the longer terms your desiring the more financials, and collateral credit requirements or going to become a major factor to get approved, now another type of financing beyond credit lines are loans are called advances, now merchant revenue advances are becoming increasingly common in the business funding arena, these are just like cash advances in the consumer world there much easier to secure their loans and credit lines, and in most cases you could be approved with no financials at all being provided, you don’t even need good credit, you so you don’t need to supply tax returns, you don’t need to have P&L statements or any kind of early financials beyond bank statements, so any of these you know these are much easier to get, just buy proving that you have consistent cash flow, like bank statements, so you don’t need the financials you don’t need to go through all the headaches. Now advances usually close very fast within a week, when loans and credit lines could take 30-90 days, so much easier to qualify, much faster to get, and the terms aren’t as favourable on advances, but the scope of who qualifies is very broad, so I will always use example when you talk about an SBA loan which as most popular kind of loan the people know about, if you really think about how many people have you ever met your entire life if told you they successfully secured an SBA loan, now if you’re like most people ask this questions to its nobody maybe 1% it’s definitely less than 5 people, very few people secure those loans because they’re much harder to qualify for, okay but when you talking about advances these are much easier to qualify for, you don’t need good credit like you need but loans, you don’t need financials or positive financials of any sort like you do with loans, and you don’t need to have good credit you know, you don’t need the financials, you don’t need collateral all those things required for loans just aren’t required for advances, now the terms aren’t favour, I mean you could pay 20% or more on advances, I’ve seen 30-40% on high risk deals with advances, much different than a 5 to 10% rate that you might get on a loan, but again its fast easy money you can have bad credit to qualify, you don’t need collateral you could provide four months bank statements to get approved and we’ve seen clients close to 40 to 72 hours we have one client calls on Monday couldn’t meet his payroll for Wednesday we got an advance took me his payroll for Wednesday when he called Monday morning so 48 hours late is done, so these are very fast to get approved if your quick to respond a lender can usually get you done in a week or less in a lot of cases as little as 72 hours or less. Now going back to advances if you pay attention of all to business funding or in the news is a company called OnDeck that does this kind of advances they’ve start the pop-up over TV and there are now getting ready to file for IPO and it will be a billion dollar IPO Google is now got behind them, so this is the most popular kind of alternative lending that exists today, and like I said OnDeck is the one company that’s now come out going to an IPO with this showing that this kind of alternative lending is here to stay, this is enough fab this is it, something is going to be around short term, this is the future of lending which is the faster easier money with less qualifications, just because you’ve shown that you do good business that you consistently bringing good revenue and that alone is enough to get you sometimes hundreds of thousands of dollars, we did a $450,000 advance for a client and we do $10,000 advances for clients, so it really depends on your situation, but what also is nice about advances is be on being fast and easy is you kinda prove yourself and work your way up, like we and one client that really had a bad situation bad credit, that everything we got our 9 grand, she invested in her business she came back 3 months later she showed she used the money to increase her revenue we got her another 40 grand, then 3 months later we got another 48 grand, so although she wanted 40 in the beginning and we got her 9 it ended up that we’ve got almost a 100,000 and she’ll continue to get more, because she proved herself, so a lot of people we talked to that’s what they want, their like look if you just give me a shot, you know I can prove that I’ll pay the money back, advances are very good with that, with getting a shoddy with credit challenges and other items at work against you like no collateral and improving yourself and reinvesting growing your business and being able to get more more money as you continue to prove your ability to pay. So credit cards there a few different types of credit cards you can secure in the business funding world, okay most of these cards work exactly as consumer credit cards do, but a lot of them have additional benefits, so the provided benefits depend on the type of card that you actually securing, okay so there’s business credit cards with no personal guarantee, now you can get credit cards through your business to Visa, MasterCard, AMEX, discover that you can use almost anywhere for almost any purpose. These cards are secured by you having a good business credit report score, you usually need about 10 what are called payment experiences this is what a lot of people for 2 straight lines, which is like, let me give you an example if Staples report to Dun & Bradstreet and Experian that would count as 2 payment experiences, so that’s an account getting reported to 2 reporting agencies with comes 2 payment experience you usually need 10 total, and you need a Paydex of 80 or higher Paydex scores Dun & Bradstreet credit score 80 needs you pay your bills as agree, so if you have basically trade lines and establish credit profile which you could build very quickly it takes about 6 months to build at this level, and you pay your bills as agreed you can qualify for these kinda no personal guarantee credit cards using your business credit to qualify not your personal credit, so your personal credit can be trashed, and you could still qualify for business credit cards if you’ve built your business credit and meet this criteria. So these card limits will mimic your highest business credit account limits now the same as we talked about earlier, this is why we have people get store credit and places like Dell commonly give $10,000 current credit limit store credits, so we always have our clients go to build their business credit quickly getting account like Dell they have a $10,000 high credit limit then we turn around and help them get Visa, MasterCard discover AMEX card for 10 grand, they pay those agreed then we turned around to keep getting 12, 15, 20 and it continuous to grow, okay so those card limits you get approved for will mimic your highest limits on your business credit reports now, which is why you want to do a little building before you get in to start applying for these kind of accounts, rates are very similar to consumer credit cards, no personal guarantee from you is required because it’s in your business name, now there are unsecured business credit cards with a personal guarantee, and you can use your personal credit to get approved for these real business credit cards instead of using your business credit, okay so let’s talk right now, why would you want one or the other, well it depends on you, the Holy Grail in business of course is to get no personal guarantee business credit cards, but you only going to accomplished that if you’re willing to dedicate some time to building your business credit, doesn’t take a ton of time in 6 months you could build your business credit to qualify for those kinds of accounts the benefits is that you’re not personally liable for your business there on top of a million of other benefits these accounts reports to the business credit reporting agencies they don’t report to the consumer credit reporting agencies they don’t pull your personal credit to get approved those are good account then there this kind of accounts, these kind of accounts are better for somebody that does have good credit or you have a good credit partner that can actually help you these don’t require you to have a good business credit but they’ll help you if you build business credit a process so the difference between the other I show you now is the other ones you need business credit to qualify with these you need good personal credit to qualify so you can use your personal credit to get approved these accounts will require you provide a personal guarantee to get approved you must have a very good credit no derogatory items or better at least within the less 12 or 24 months less than 2 inquiries in the last 6 months and utilization below 30%. Utilization means what is your limit and compared to what you owe, if you have a thousand dollar limit account and you owe a 300 dollar on that, then that is 30% of the limit and that is 30% utilization so they want to make sure you’re not over utilizing your personal cards you have very few inquiries, and you don’t have any derogatory items to get approved and if you do meet that criteria you can get approved, and you typically get 5 times the amount of credit of your highest credit limit reporting account now, so this will come in the form of 5 separate cards, so if you have a credit card limit of $5,000 now, you can usually get about $25,000 worth of this cards, if you have $10,000 limit you could usually get $50,000 limit cards, so you can usually get about 5 times whatever your highest credit limit account is, and this cards usually only reports to the business credit reporting agencies not the consumer ones, and they also offer intro rates for about 0% for 6 to 18 months, now you can reach out to us and let us know if you’re interested something like this, but these are not ones you can go out and get on your own, you’re not going to go out and get these kind of accounts without going to a lender that specializes in this kind of lending, and here’s why, right your actually right, here’s why because you can’t get approved with two inquiries or more, so if you went in the Bank of America applying that credit card, then you went to Chase, Chase is probably going to deny you, because they see the Bank of America inquiry, but there are lenders that do this in a way where they know which lenders will approve you they know the regional lenders in your area, they apply for all of it at one time and in one shot within an hour you get 5 different approvals something you could not do on your own, I know we’ve tried we had a client with 8, 10 credit scores we help him go to his Bank to apply, cause he didn’t want to pay the lender a fee to get this kind of account, the lender could have them 75,000 going to his own bank he got 12, 500 approved, that’s pretty common you can go to your own bank with great credit and they’ll give you a credit card but usually for a 5th of what you could have done if you work with the lender the specializes and getting this kind of unsecured credit, now there’s also unsecured personal credit cards with a personal guarantee. You can use your personal credit again to get approved with these kinds of accounts but these accounts were also required that you provide personal guarantee to get approved you must have good credit that great okay you won’t need a good credit is the one I have showed you. You can get approved with these 5-660 eighty credit scores, the other ones required more 700 type credit scores you can get approved for these with some old medical collections of collections on your account you can get approved for these with utilization of 60% with 10 inquiries in the last 90 days. So these are little bit more lenient than the ones I just showed you both require a personal guarantee both look at personal credit to get approved, but these are more lenient on their credit requirements to get approved but the difference is they reports the personal credit reporting agencies, not the business credit reporting agencies and again you could typically get 5 times amount of credit that you would normally get and again it come in the form of five different cards. So 3 similar programs, one has no personal guarantee because you have business credit to established that’s how you got it, the other when does have a personal guarantee because you’re using your personal credit to qualify your personal credit has to be stellar, and they report to the business credit reporting agencies then there’s personal cards where you can get with a personal guarantee also they report to the consumer credit reporting agencies not the business you can’t build your business credit to process but the benefit is it’s more lenient to actually get approved so these are more closer to all the credit card you’re normally see out there in places but again you really want to work specialized lender, the specialized in this because if you don’t you’ll probably get about fifth of what you could get without a lender that actually knows what they’re doing in this space. So applying for business funding seekers of the application now you have kinda roof of general idea the kind of money that’s out there loans, credit lines, credit cards, really almost an advances almost everything you’re going to find out there whether it be asset-based like collateral based lending or 401k financing or an SBA loan or whatever it may be fits into one of those buckets I just told you and now knowing these buckets make it a little bit more easy to separate this, and know what kind of financing you’re applying for. Now if I’m moving kind of fast it’s because it’s just the way my brain works I have a tendency to move fast, talk fast so don’t worry if I telling this webinar, in its entirely you get a playback this webinar you can stop pause go back write down anything in it so if I’m moving a little bit too fast on something don’t worry you will get a chance to go back and read this. So applying for business funding secrets to the application we hear is are typical application for a customer hey this is a costumer that this is an application that one of our customers were actually fill out to come and get financing and it’s a general application that really work for asset-based lending everything out so you can kinda get an idea of exactly what’s on the actual application, and we’re going to talk through a lot of these lines because when you look at this you say great Ty thank you, you showed me an application that’s amazing, but that doesn’t really help you any, so what I want to do is dissect this application, because every line item on an application is being asked for a very specific reason, problem is if you don’t know why they’re asking what their asking for then you could very well put information that is the deterrent for them giving you money, so if you understand why their asking you these questions, then it makes much easier to get approved, because you can then go through and fill up the application, with accurate information, but do so in a way that its enticing for them to want to give you actual money. So company name if you’re choosing, if you’re just choosing a name, try to choose a basic or loose version of a name that doesn’t peg you into a certain industry look, there’s a lot of lending that has industry restrictions scrapped that, all lending has industry restrictions there’s no product out there, that I’d ever seen that doesn’t restrict certain industries, they’ll say we won’t help this industry, we won’t help this industry, sometimes just because your name reflects the industry you’re in could get you deny, So when it comes to business credit of financing if you are just choosing a company name, try to choose something very general, because the more specific you get it might help your customers know more about what you do, just keep in mind it does sometimes make it harder to actually get money, and I’ll give you a very simple example, like our company name is Credit Suite, and we get all kinds of blow back on this, when we apply for anything because they think were credit repair company even though we’re like in the business financing space, were as far away for credit repair as you should get just because the word credit is in our name it creates problems for us. So does that mean we were name ourselves something else, yeah we actually probably we will change our name, partially for that reason and use another brand that were under, but didn’t wouldn’t be prohibitive of us doing it just because you’re trying to get business money, it’s just something to be consciously aware of, that when your industry your name reflects your industry, it will sometimes create problems especially if that industries on a restricted industry list. There a lot of industries that fall on restricted list, your name can elude you to an industry and maybe that maybe you are, or maybe you’re not part of, and this can affect your ability to get approved. So for example the name Elite Credit got my bank account shut down just because the name let the lender to believe it was a credit repair company, which it was, so I used to own a credit repair company back in the day I sold it, and at that time I had a bank account with Wachovia when Wachovia was still around, and Wachovia shut me down just because my name had credit in it they thought I was in credit repair which I was at that time, and they shut me down, so these the kinda problems you could have just by your name reflecting the type of industry that you’re in, trust me I can definitely give you feedback from that, from personal experience. So general consulting type names work best as nobody will deny you, okay any other industry specific name very well might restrict your ability to get money with some lending sources and credit issuers, so for example Elite Consulting, Elite Business okay that’s a lot better than Elite Credit is nobody would not lend me credit or money with the general consulting name, and this is advice we give everybody that applies for business credit. I’m not saying you need to rename your company, I’m just saying you should think about the repercussion the name could have when you’re applying for business financing this is why we dissect an application, so you know what they’re looking for and why they’re looking for, so these might be better names to consider, okay the more general the name the better your chances of getting money and credit for your business. Now the phone number you got to have a business phone number, don’t use a personal home or cell phone, yes lenders will know, okay lot of people think they can get away with this, they can’t we have technology in our business finance suite to tells you right away what it is, so somebody enters a cellphone and up you cannot move forward during in your cellphone that won’t work, in our home phone up cannot move forward you’re entering a home phone there’s technology that’s simple and automated where they’ll take your application without human even looking at it, and non-low right away whether you have business phone number or not so don’t even try applying for money without a real business phone number. Voice over IP numbers are okay so Google numbers a ring central voice over IP number those are just fine, those are acceptable. Okay you should have a toll free number unless you only deal with local business such as a pizza shop. I give you a pizza shop you don’t need a toll free number because everybody is calling you as local, but nowadays most of as with the internet do business state wide, regional wide, nationwide and when that’s the case they really would expect you to have a toll free number, and you should also have a fax number, even though a lot of us don’t use faxes nowadays, we tend to use scanning and emailing things like that you know most big professional businesses has fax number, I mean there’s no company like Dell or Apple or Microsoft that doesn’t have a fax number like every large company has a fax number so you need to make sure that you have a fax number, and your number must be listed wit 411, not your fax number, but your phone number needs to be listed with 411, now here’s one of the basic requirements most people miss, it’s crazy but lenders will deny you just because you don’t have your phone number listed with 411 as a matter of fact it’s one of the most common reason that we see people get denied for financing, is because it’s, it’s crazy so there’s a company called list yourself that will help you do this, you can’t just go out get listed with 411 so I’m telling you this, you don’t have to learn a hard way, but a company like list yourself can do this for you, and yeah I will recommend trying them so we run our clients true. So are you a homeowner, being a homeowner increases your chances of getting approved it shows a greater level of maturity and responsibility plus it shows you can manage a higher monthly payment, and your home might even be used as collateral for some financing such as SBA loans, so when I ask are you a homeowner or not, that’s why they’re asking the minute you put YES you become less of a risk, when you say NO and you’re renting you become a higher risk. Assets, lenders love assets because they love collateral, so when your ask on the application of the asset you have with the lender really asking about, is they want to know what collateral you possibly might have to offset the debt, off set their risk, the more collateral you have better chances you have to get approved with a lot of different kinda financing, SBA loans require the lender to take all assets that you have in the businesses collateral, and if you still don’t have enough they’ll take your personal asset such as home, now I was at our credit booth camp talking about this very topic on stage and I actually showed SBA’s underwriting guidelines. SBA requires, it’s not even the lender choice they have to take all of your business assets as collateral period it’s required, and if you don’t have enough assets and collateral they’ll require your home, now again I’m talking about all kinds of financing I’m just telling you SBA loans are particular it’s part of a reason, that they’re so hard to qualify, so when they ask about assets on an application, this is what they’re really asking for, so some lenders such as advance lenders, don’t need collateral, so we’re talking about advances earlier, though they don’t want collateral they don’t’ care if you have collateral or not, but a lot other lenders will, and but it still helps them feel more secure and lending you money if you do have assets to show, so even though it’s not going to be a factor that ties and your approval, if you have assets they still feel more secure, it still might be a compensating factor that helps you get approved if you have weak areas other places like really bad credit having assets can help offset the risk could still be approved, and a lot of things can work as collateral and here a list to quite a few of 401k, stocks, real estate, inventory and equipment, purchase orders and account receivables any other items are easy for lenders to sell and get their money back in case of default, you know I had a management meeting earlier today with our team and one of in our funding manger was talking about a deal, were the chiropractor wanted to use a piece of equipment from 1989 that was a like a hair removal products from 1999 as collateral, and it obviously couldn’t work because like nobody wants of 30, 40 year old piece of equipment, there’s like nobody out there that would want to buy that, so it’s not something the lender can easily turn around and resell, so that’s what they’re looking for, when they’re looking for collateral they want something they could quickly get rid of, if need be to get their money back, okay so and I use a home as an example, you know when you get a home, your home is the collateral for the mortgage you default they sell your home, be yet they don’t want to sell your home they want you to pay the payments because you know the process of going through in selling that asset is lengthy and costly, so they’re really looking forward the best assets that they can easily liquidate when they’re actually talking about assets that provide real value. Time in business the longer your business the better your chances of getting approved for almost all types of financing, and that’s because extensive statistics on this show that the majority of businesses fail in early years, 3 years or less, the longer business open the more chances of failing decline, okay so longer standing businesses have a much less risk of going out of business than long standing one still. Being open less than one year makes it tough to get financing, you can get unsecured personal and business credit cards which we talk about, with no issues, but advances even cash flow advances just looking your bank statements are tougher and loans are nearly impossible to secure, because as we talked about loans want financials like you’ve been in the business less than a year, you wouldn’t have those some business credit vendor stores and cash credits sources also might not approve you if you’ve been open for one year or less, so we have a lot of business credit sources like home depot. Home Depot wants to see that you’ve been in business for three years to give you a business credit card, you can get approved before three years, but they usually want to personal guarantee and another things, so whether its business credit sources or its financing sources, some of them a lot of lenders sources require a year in business to really able to get your money, 3 years or more really what’s prefer, so I ask how long you’ve been in business just now they’re really are hoping you’ve been in business 3 years or more, if not you’ve still a chance to getting approved depending on the kind of financing you’re going through, I’m just telling you what’s prefer, what they really looking for, this is part of a reason that SBA loans require two to three years of financials to get approved okay because they want you to be in business 2 or 3 years so you make a supply financials for two to three years, in order to be able to get approved. So average revenue, having good stable revenue can be the one of the main reasons you get approved for some funding products such as merchants while revenue advances, okay just having consistent revenue alone can actually get you approved but almost all sources do require you have revenues do coming in for approval. A lot of credit cards we talked about don’t but a lot and in some of collateral based financing doesn’t actually require this, but a lot of the other one do, they want to actually see, that you actually do have you know average revenue coming in to be able to qualify, some sources such as personal business cards as I just said won’t require this, other sources such as lenders to lend advances lenders will verify your cash flow with your bank statements, they don’t need this in your tax returns, these are talking about alternative lending but they will require that you provide bank statements to verify cash flow. Most lenders issuing loans and credit lines will require tax returns on top of P&L statements and bank statements to verify your income, your tax returns again have to show good net profits, the amount you show will determine the amount of money you are approved for, in a lot of cases so when they’re looking for loans a lot of times when you get a loan the amount of money you get is were equivalent to your net profit, just what we talked about credit lines earlier, so something to keep in mind you must show increasing profits from year to year not declining profits which we already talked about, declining profits are a sign of trouble, and most lenders will run away from any deal with the applicant has revenue or profits declining from year to year, I always use Shark Tank is an example like, if you ever watch the show Shark Tank do you know the last question, I mean what were your revenues the last 5 years, I’m going to need 5 million dollars, okay how much did you make last year, I make like a million dollars and then they say how much you made this he goes, well you know this year we have some problems I’m going to make 500,000 you here the whole every Shark oh men that’s not good, everybody pulls back they don’t want to see that your declining, they want to see that you’re growing when they see you declining it’s really a sign of trouble in most lenders mind, now there are many high risk industries lenders do don’t prefer, and the list of high risk industries is different for each lender and finding type, some lenders have been burned by one type of industry and blacklisted, while other lenders offering similar products are okay with that industry, it’s actually pretty interesting, we had a very big advanced lender come down and visit us, cause we do it ton of volume, so they’re commonly come down, and do and spend some time with us, so I was actually asking , how do you determine your high risk list, and I thought it was an industry standard, and he said no, it’s actually not, he goes with us it’s who burn us, so for example we got burned by student loan company, so we don’t do student loan companies anymore we got burned by this type of industry so we don’t do, so even though you know they might have only been burned once or twice, they’ll stay away from the whole industry just because, them individually have been burned, now this is what’s nice about working with a lot of different lenders like we do, because we commonly find that one lender will not approve a customer, while another lender will, and wee this credit repair, a lot of our clients are credit repair company, so they actually offer our business credit financing services so they come to us for money and we get a lot of these credit repair companies approved even know there are restricted industry with most lenders, just because we have pulled so many lenders and we know lenders that will approved that industry so when it comes to industry restrictions it does have to do with the type of financing you’re getting and also really has to do with the individual funding source, on who they restrict and who they actually don’t, so some industries are almost always seen as high risk no matter what lender you apply actually true. So vices for example almost always seen as high risk, so gambling, porn, if you’re in those industries almost any lenders dimmed those as high risk industries other industries such as financial services are strict with many lending sources but not all so for example if you are an insurance agent will you’re probably not going to get revenue financing or advance at most places, they don’t even like anybody in financial services credit repair being lenders they don’t want even cash advance space, insurance agent, real estate agents, mortgage brokers, they just don’t even like anybody else financial services. Whereas SBA in loans and credit cards, I don’t even care about financial services industries so it really has to do some lending sources just restrict industries altogether but others don’t so financial services can include credit repair lenders, account insurance agents, mortgage brokers, realtors and anyone else dealing with any type of financial transaction can actually fall into this bucket of financial services which can be restricted industry in a lot of cases. So we ask upfront the lender user industries high-risk well it’s worth it. I’ve seen people go through this entire application process and then to find out what we don’t do it because you’re on a high risk industry, will why didn’t you just tell me that upfront, you didn’t ask, so again we tell our customers upfront you’re in the high risk industry, this long show or no problem, but you should still should ask upfront am I, is my industry on your restricted list is this an industry you don’t like to lend to, one that you deem to be high risk, and if they say yes, you might want to check another source before you even apply, because unless you have some pretty strong compensating factors, they’re not going to usually do a high risk industries, so let me give you an example, get a credit repair company now we got done not too long ago, if we got by 200,000 plus for this company so far, okay credit repair they try other places, they got denied, because they’re on the restricted list we got them done because, they had been in business a long time they manage their bank account well, the owner had good credit, so there were several compensating factors as we said, hey you might not like the industry but look at all of these strengths, so the more strange you have this compensating factors can also help you in some cases get passes high risk, but it’s good to know upfront the high risk before you even apply. So credit scores, no matter what you’re told personal credit always matters unless it isn’t being looked at all, business credits perfect example, like when I tell people they can get business credit with no personal even with bad personal credit, like a lot of people are sceptical, bit it’s possible because you don’t even put your social security number on the application, so when they can’t even look at your personal credit they obviously can’t use that enough as a factor in your approval, but business credit are very rare exception is one only kind of real credit financing it’s out there, that you can’t secure without your personal credit even being pulled, in any other case your credit will matter, so for example when you apply for business credit you can use your EIN to get approved and leave your social off the application, when you do this your personal credit isn’t even looked at, nor is it used for the lending decision, but this about the only exception in the funding space with this actually happen, all other types of financing including advances, look at an care about your personal credit, Yes you can be approved for cash flow financing and merchant advances with bad credit, it actually happens quite a bit, so merchant advances, cash flow financing we get those done, are average customer has less than the 600 credit score, we got credit cause cut for companies down to 520, we’ve seen 580 business owners secure over a million dollars, so you can definitely get money, we challenge credit but the terms aren’t going to be as favourable, if you don’t have the credit, so yes you can get approved but your terms would be much better if you had better credit, now don’t wait till your credit is good to apply that could take a long time, you sometimes take what you can get, but just keep in mind that the terms you pay will be determined based on risk, and when it comes to personal credit it will factor in to your overall risk. SBA loans, conventional loans, most other long term loans, and credit lines do require good credit for approval in most cases, some like advances won’t, okay so not being said a lot of them will not, you know that a lot of them won’t lend you money once you have personal credit like SBA loans you go in your bank they’re going to require good credit almost type of things, okay but and a lot of other cases you should get approved, even challenge credit specially if if you have collateral, cash flow things like that, I don’t have time for bunch of questions, because I have another webinar right after this, so I will put up my email and phone number to answer questions, but somebody did just type in does on debt deal with credit repair companies, and the answer is No, OnDeck doesn’t deal with credit repair companies we tried to run through them with them before and we haven’t really had any success even with strong compensating factors withdraw a lot of other sources out there to do, so collateral an asset based type financing doesn’t care about personal credit is much, this if the financing only looks at collateral for approval not financing or collateral was required for approval. So an SBA loan is a type of loan were you have to have collateral to get approved, they care about personal credit, but if you’re getting 401k financing using your 401k as collateral, and that collateral be the type of financing you’re getting then your personal credit doesn’t matter, so that’s pretty cool, because you can get 401k financing at 4% rate even with 350 credit scores, you can get account receivables financing at one and a half percent discount rate, even if you have 350 credit score, so if you go into an asset or collateral base type of funding product, then you actually can get approved for money, where your credit really does it factor in that much, because they don’t really care like, you know if you default they just take your collateral and they get their money back right away, so it’s not as big of the deal, but SBA loans where you’re only collateral rising up portion of the actual loan, can actually create problems. So there’s no Fair Credit Reporting Act in the business world, so lenders will never disclose to you, that they do pull your business credit when applying for financing, but they do pull your business credit, so just think you’re playing for money, for your business and your business has its own credit profile and score, so of course they’re going to pull it, like a lot of people think they won’t and they don’t have business credit, but yeah I mean you’re getting money for your business, your business has a credit report they’re going to pull the business credit report, okay so make sure that you had your business credit profile established, because that really ties and, with getting approved for a lot of different financing, not having established business credit makes you look like a rookie start-up, non-established business, okay that automatically leads to denial in a lot of cases, so insure you have 5 to 10 reported accounts and a good business credit score, like Paydex score, so that reflects paying them as agreed so you will have a good business credit profile. Now you actually have 3 types of credit, a lot of people don’t know this, you have your personal credit, you have corporate credit which is a business credit it’s linked to your EIN, and you have bank credit, okay so you actually have the banks actually have their own internal credit scoring system for your business called bank credit, okay and all 3 have to be good or should be good to give you the best chance of approval, now if you’re going for an advance for credit card they don’t care about bank creditor business credit, but if you’re applying for SBA loan, well SBA even says in their website that you should have good credit in all three in this area to get approved, so again you’re higher level loans, you’re credit lines that are $250,000 they’re going to want to see good credit in all three of these areas, plus collateral based lending or something that’s just looking at your cash flow really won’t require that you be good in the all three this areas to actually get approved. So your bank rating is what your bank credit is actually called, is mostly based on the amount of money you keep in your bank account over the last 90 days, so a high 5 account is needs you have about seventy to hundred thousand in there, mid 5 is that you have forty to seventy in there, a low 5 gets you ten to thirty nine thousand, this is where you want to be, to have a good bank credit you should have a 5 score, and a 5 score starts with you keeping an average balance of 10 grand or more on your bank account, somebody said this to me your there they go you know. I keep of much money on my bank account to have good business credit I said actually that doesn’t help your business credit at all, it helps you bank credit and we have that discussion, so it’s important to know that having a bunch of money in your bank account doesn’t help your personal or your business credit scores, but it is completely what your business banking scores based on, what your bank rating is based on, and here’s how its break down beyond that, you could have afford depending on, you know if you have a thousand dollars average of the account to 7,000 you’re in the 4 you don’t want to be in a 4, you want to be in a 5, so again does this matter are you applying with a bank for bank financing they yes it does, if you’re going to collateral base financing like account receivable financing or equipment financing not so much, but if you try to go to your bank and get an SBA loan yeah it matters a lot, because they you’re getting money in your bank, so one thing you they’re going to look out is their own internal bank credit scoring system to see where you stand, if you’re in the high 5 you have a good chance to get approved, high 5 really its really god chance, 4 not so much . So funding approval time frame, the higher dollar amount or line in secure, the longer it going to take to underwrite, no matter what type of financing you’re applying for. Loans usually 30-90 days or more, credit lines usually take about 30-90 days or more, advances are very fast seven days or less, credit cards usually takes three weeks or less to actually secure, so gives you an idea time frame, so if you want fast money advances are your first, if you want the second fast credit cards, all credit cards we talked about our best, if you, you know really have good financial, good everything you want more money and you want to weighted out than 30 to 90 days for loans and high limit credit lines. Due diligence checks, just talked about this today and tell you what happened, all lenders will due diligence check on you and your application they will look to see if you have other outstanding loans you neglected to mention on your app, they will check to make sure your lease or mortgage is in good standing, we just had one list decline, we got the person to the entire process and they doing due diligence check at
the end they contacted the landlord the landlord will said heck know this guy doesn’t pay me, he’s 3 months behind and when he does pay, his sporadic his payment, denied done, whole underwriting process was done, guy was going to have money tomorrow and the deal just got pulled either yesterday or today, because his landlord trashed him, and the lenders review, so they do these due diligence checks and this is exactly why don’t count your chickens before they hatch, don’t go try to spend the money you think you’re going to get, because it’s not done until the money is in your bank account, and one of the last thing they do is, is do due diligence check, and I’ve seen many of deals get denied hear, one company got all the way to the end, they went to their website, the website said they were going out of business, done declined, it’s crazy how many obvious thing that we see that the person thinks that they can get away with it, doesn’t, but these due diligence checks were always come at the very last, and if there’s anything outstanding you lie you misled them, you have outstanding loans they don’t know about, your defaulting on your mortgage or lease payments, any those type of things can lead to this, they will look to see if you’re going out of business like I said on the website, they’ll even look at your online reputation like, you know if you’re going out of business, then, you know a good chances are good that you stop delivering your services and all a sudden you’re DDB and Ripoff report, starts getting bad, so they will check this stuff out, there will be a trauma and reputations are you going out of business, how’s your mortgage lease at good standing, and this checks done in the very end, so you got to make sure that your solid in these area. The purpose of this check is to find hidden risk they couldn’t find on the application, and the other purposes is to see if you left information off the application intentionally if you lie to them basically, so make sure you disclose everything you are asked to otherwise lenders will find out about, I never sees to amaze me, we do a lot of advances for clients, and one of the biggest thing we sees, they have an outstanding advance that they don’t acknowledged on the application they have, the lenders know about that immediately and declines the application because a customer lied, don’t try to keep this stuff from the lender, okay and this is why it’s good to have a middle man involved like, what I like about our finance division is they work between the customer and the lender, so they can help the customer make sure that they’re putting the right things on the application, that their disclosing what needs to be disclosed and the customer can openly talk to them about what’s going on and get advice and consultation, about how to proceed whereas if you just going with the lender direct is kinda hit or miss, you have to just give them the info and hope it pans out well, but you got to make sure you disclose everything you asked to otherwise the lenders will find out about it, this check usually take about 1-3 days to complete, it usually happens same day at the very end of the process. So what type of financing should you apply for now that I’ve done an extremely good job of completely confusing you, with a lot of different kinda financing, now let’s get to the nuts and bolts, what should you actually be applying for, well there’s a lot of different type of financing out there, as we talked about, so many options that you might not even know where to start so let’s take a look at some of these available options. First let’s talk about your bank, because when I ask business business owners where they go when they need money, this is what they say, I go to my bank, but according to Department of Revenue which would be surprise to find, is that only 1.1% of all business funding comes from conventional banks, such as SBA loans, and this still blow me away, this is what we are trying to trying the industry, we want to be the name that when you think about business financing, you think about us, because nowadays when you think about business financing your credit, you think about going to your bank, but the problem is they only account for a little over 1% business financing it takes place, they’re not the best source of business, so if you go to try to get that kind of money, you’re probably going to get denied so you’re bank can help you with credit lines in loans but you have to have financials and good credit and collateral for approval, okay you can goggle SBA loan approval checklist, to find in this page here, okay and that’s exactly what you can do SBA loan approval checklist and you’ll find some link called http://www.sba.gov/ content/business-loan-checklist check it out that’s everything you have to have to qualify for conventional loan or an SBA loan at your bank and if you look through that you’re probably going to find that you probably won’t meet that criteria, very few people even do. These are very hard loans to get, so try to go to your bank to get money is going to be a tough road, okay that was all that you’ll need in the approval on that page, now most business financing does that take place comes from these alternative lending sources. These lenders who have carved out niches in the business funding world they typically focus like on one aspect of your business instead of your business in it’s entirely at that one area of business strong, you can get approved, even if you’re weak in other areas this is not the same with your bank. If you go to your bank you have to be good in all areas which most companies are, but with alternative financing you could be strong in one area and be linked in others and still get approved okay a very different than SBA loans. So alternative lending is much easier to secure the conventional loans. You can usually get approved and funded much faster also the terms are also its favourable because the risk is much higher, okay but you can also often get approved when your bank says no, okay so alternative lending is much easier to secure the conventional loans you can easily get approved and funded much faster it is just I said, I don’t even know it I think I actually have to the same slide there. So we discuss several different types of funding and available based on your actual credit. Some use your and let me go back so we talk about alternative lending, that is your collateral based lending I guess I kinda bonds that in here it’s also cash financing it’s merchant advances it’s more the advance kind of funding that actual loans and credit line then you’ve got credit based financing so this is alternative this works really well if you have cash flow like bank statements verified. But if you have good credit or good credit partner and we talked about a lot of those options that work of credit so some user business credit for approvals as we talked about other issues personal okay you get go into your banking get this kind of credit you really should go to a lending source you get to fit on what you could get but there are lenders who focus on a type of financing only, and they get you multiple high limit cards we talked about earlier. Remember you got to have good credit here, or good business credit to get approved for unsecured credit based kinda programs, okay then again there’s a third type, is collateral based funding, so with collateral based funding, collateral based lenders basically lend you money because you have assets, they can approve you for money even with bad credit, even if you just opened your business, the key is that you need to have acceptable collateral to actually qualify, so that could be 401k and stocks, inventory, equipment, real estate, a book of business for insurance agents only, a car lot inventory, purchase orders and account receivables, commercial signs, graphic wraps, you know any other kind of viable form of real asset or collateral you have very well might work, vehicles are depreciating assets they usually won’t qualify, rates and terms and collateral based financing are very good like I said, I mention some earlier that one and a half 2, 3, 4 percent rate, okay it’s not uncommon to get rates of 5% or less, even with horrible personal credit, because if you default the lender just takes your collateral, so like there’s not a lot of risk with that kind of financing. Financing based on cash flow, now again I guess what I said alternative financing before, I was kinda grouping a lot of these things together, now I’m kinda getting in to specifics of that, so you’ve got again we talked about the collateral based financing we talked about credit based financing, now will talk about cash flow based financing, so most advances are forms of cash flow based financing, fastest and easiest way to get money, get approved with bad credit no collateral, but you’re going to need to show bank statements and you going to have to have 10,000 a month in monthly revenue coming in, I mean at least 6 monthly transactions typically get approved, and you can usually get about 12% of whatever your annual revenue is, okay their cash advances, so keep in mind the rates are going to be good like if you think about Amscot they deal with cash advances to, rates aren’t good on cash advances they could be 8% to 40-45% because it’s high risk money, okay but again if you’re worried about not being able to afford that, that’s not the case, you know when I talk to lender usually their collection rate is less than 10%, 9% or less so they do this in a very smart way were definitely works for most people that they secured the money for, even though the rates are higher, you usually be approved for 6-18 month payback term, one you prove yourself the first advance you get better terms, and a lot of people that get their first advance come back every 3 to 6 months to get more, more, more money, matter of fact 80% of our clients that we see do that, and that’s why you find it 70% of the industry get their first advance and come back for more money. So final thoughts, there’s a lot of money available out there for business owners, more now than really there’s ever been in the past, you just need to know what type of financing to go after, once you have an idea whether or not you want to go for collateral based lending, or cash flow based lending or credit based lending, then you’ve seen a good chance to getting approved versus bank type lending which you don’t stand a good chance getting approved, so make sure you set up your business credibly some of the things we talked about to address on the application before applying to have the best chance of getting approved, and also keep in mind we offer all this type of financing and credit discuss, so you know if we can help you with any that kinda financing let us know, we have all these different types of financing out there or you can find it individually are on your own, but again what you’ll find is most lenders out there offer one or two kinds of financing not at all, but that’s okay cause now you know what to look for, not that you know what kinda financing out there to look for, now you’ll be able to find the kinda lenders I can offer you the kind of credit that you might able to get, so hopefully excuse me kinda financing that might be able to get, so hopefully that helps you’re going to get a playback at this webinar, were you can go back and focus on the areas that kinda meant the most to you, so I know I walk to kinda fast that limited time if you able any questions so we can help you at all with getting business credit financing there’s a number 877-600-2487 you can also send me an email direct I do respond to my emails [email protected] and if you want more information on us, what we do you could check this out creditsuite.com /businesscredit that the lender introduce to our partner opportunity where you can get credit financing for your business and help customer do the same, so is in all my webinars I hope you got a lot of information out of this, that can help you get financing for your business, because we’re in the business of helping business owners succeed, so hopefully this helps you do so, and again I’m going to go and wrap this up, cause I have another webinar coming up in about 2 minutes, so if you have any questions feel free to give us a call, send us email thanks everybody very much for taking the time to attend this webinar.