LeBron James said that the door is “not closed” on a potential return to the Cavs and that his last season in the NBA “will be played with my son.” The post LeBron says 'door's not closed' on return to Cavs appeared first on Buy It At A Bargain – Deals And Reviews.
Month: February 2022
Here’s When to Dip Into Your Line of Credit
The Best Ways to Use Your Business Line of Credit
A business line of credit (LOC) is a powerful tool to help business owners handle surprise expenses or navigate a dip in revenue. Having an LOC to draw from can be the difference between business failure and survival.
But like any money you borrow, LOCs must be repaid—with interest—so it’s important to think through the best ways to use this funding option.
Here’s what you need to know about a business LOC and how you should use it.
What, exactly, is a business line of credit?
An LOC is an arrangement by which a bank or other financial institution agrees to provide a customer—an organization or individual—access to funds up to a certain limit. The customer can draw funds up to that limit at any time and must pay interest on the amount borrowed until they repay it. After repayment, the customer can borrow those same funds again (and again) to cover further expenses.
A business LOC is different from other common business funding options in several ways. The option it most closely resembles is a credit card. This is since both of these function by allowing the borrower to draw money over and over up to a given limit. An LOC is unlike a credit card, in that an asset like a home or business property might secure it. This often leads to lower rates (traditionally 3% to 7%) and higher limits than credit cards.
Another common option for business funding is a business term loan. You might secure it with a business asset, as with an LOC. Unlike an LOC, though, a business loan is due in set installments that can range from three months to 25 years. While with an LOC, payment is typically due monthly on the amount you borrowed, and interest only accrues on what you don’t pay back on time.
What is a business line of credit best used for?
It is best to use business LOCs when you know you can back the funds relatively quickly. Hence business owners who lean on LOCs to finance regular business operations may quickly find themselves in trouble with repayment.
“A line of credit is meant to be a short-term bridge rather than a long-term fix,” says Matt Schulz, chief credit analyst at LendingTree. “It is meant to provide a consistent access to funds to help businesses push through short-term crunches, such as waiting for a client to pay an invoice or seasonal dry periods.”
When deciding whether to use an LOC for a given expense, err on the side of caution. You want to preserve borrowing capacity to maintain a safety net. But if the expense in question is the type that a safety net is made for, then borrow away. Here are five situations where you may want to consider using your business LOC.
Unexpected emergencies
An LOC can be a good way to respond quickly to a true emergency in your business. For example, a natural disaster that damages your property. Or the complete breakdown of vital equipment. You need to fix these problems right away. They may be expensive to address. But an LOC can accommodate this.
However, it’s best to think ahead about how you’ll repay the large expense quickly. This is to regain your borrowing power and reestablish your LOC safety net for the next time something comes up. In the case of a natural disaster, you may anticipate receiving insurance money that you can use to repay the LOC.
Equipment repairs
A small equipment repair is an excellent use case for a business LOC. It’s best to try to limit your use to repairs that are relatively inexpensive and quick. This is so that you don’t tie up too much of your credit limit for too long. That’s why it’s best to finance major, nonemergency repairs or the purchase of new equipment in another way, such as via a business loan.
“If you’re talking about new equipment altogether, [using a line of credit] might not be the best fit,” says Shulz. “Tying up the funds from a line of credit in a big equipment purchase means that there is less of it to use as a safety net in case cash-flow woes or other short-term financial hiccups occur.”
Ramping up
Using an LOC to help you pay for necessary expenses while you’re ramping up your business can be a good idea, assuming you’re sufficiently sure of success and anticipate being able to pay the LOC back by way of increased revenues in the near future.
Borrowing money from an LOC to start a business you’re unsure will succeed is an unwise choice. You’ll be liable for repayment even if the business fails.
Busy seasons
Some businesses have de facto busy seasons or are explicitly seasonal, which can put a strain on business resources at certain times of year. An LOC can help you cover all the expenses required to function optimally in the busy season. This is with the anticipation that revenues from those heightened sales will allow for quick repayment after higher sales ebb.
“The extra funds from the line of credit can help you handle those extra expenses while you wait for the cash to start rolling in during that busy period,” says Shulz. The key is ensuring that you have full confidence that the sales will indeed be rolling in soon.
Awaiting payment
An LOC can help when you’re waiting for payment—especially late payment—from a customer. Or when ramping up to handle an important new client. In both cases, you know money will be forthcoming, which will allow you to repay whatever you borrow very soon.
Just be sure that if you borrow from an LOC as an advance on forthcoming payment that you are absolutely certain that money will be coming along soon. You can get in hot water if you dip into your LOC only to have your client default on payment you’re expecting.
Secure an LOC before you really need it
Ideally, you should have an LOC set up before you need the money. Establishing a business LOC can require an initial investment — if the lender charges closing costs. So it may be hard to stomach setting one up before you feel you absolutely have to. But the security it provides is well worth the initial outlay.
“It can definitely be smart to get that line of credit before you really need it,” says Shulz. “Remember that you don’t have to use it when you get it. You’re only charged interest on the amount that you actually use.”
In a best-case scenario, you establish your LOC and never have to borrow against it. But you’ll sleep easier at night knowing it’s there.
Katherine Gustafson is a freelance finance and business writer specializing in content marketing and thought leadership. Her work has appeared in finance and business publications such as MagnifyMoney, StudentLoanHero, Forbes, and Business Insider.
The post Here’s When to Dip Into Your Line of Credit appeared first on Credit Suite.
ESPN's Voepel, Walt Frazier, Ebersol win Gowdy
ESPN’s Mechelle Voepel, Hall of Famer Walt “Clyde” Frazier and longtime NBC executive Dick Ebersol were named the Naismith Hall of Fame’s Curt Gowdy Award winners.
The post ESPN's Voepel, Walt Frazier, Ebersol win Gowdy appeared first on Buy It At A Bargain – Deals And Reviews.
Hight tops Funny Car qualifying in NHRA opener
Robert Hight topped Funny Car qualifying Friday night in the NHRA Camping World Drag Racing Series’ season-opening Lucas Oil NHRA Winternationals.
The post Hight tops Funny Car qualifying in NHRA opener appeared first on Buy It At A Bargain – Deals And Reviews.
Kodable (IK12) is hiring a senior game developer to help us teach kids to code
Article URL: https://angel.co/company/kodable/jobs/1983277-senior-game-developer-unity
Comments URL: https://news.ycombinator.com/item?id=30388182
Points: 1
# Comments: 0
2 Philadelphia teens, 12-year-old boy charged in beating death of elderly man during carjacking
Two teenagers and a 12-year-old boy have been charged in the Dec. 2, 2021, beating death of an elderly Philadelphia man in the city’s Mayfair neighborhood.
NYC Mayor Eric Adams subway safety plans calls for outreach workers, including school nurses
New York City Mayor Eric Adams announced Friday a plan to dispatch teams composed of outreach workers, cops and mental health experts to combat homelessness and rampant crime in the subways.
5 Cash Flow Based Lending Options to Take Your Business to the Next Level
Cash flow based lending options can be great for fast funding. Both PayPal and Square offer these types of options. Credit Suite has similar options as well, including:
- Revenue Based Lending
- Purchase Order Financing
- And Accounts Receivable Financing.
Using these types of funding allows you to get the funds you need based on income and without good credit. Repayment is typically based on cash flow as well, meaning the more you make, the faster you repay the loan.
Cash Flow Based Lending Options Can Help You Fund Your Business Fast
Cash flow based lending options are those that are extended based on a company’s expected cash flows. This refers to the amount of cash that goes in and out of a business within a specific period of time. The amount of cash flow is what lenders use to make approval decisions. Repayment comes from this amount as well.
Typically, you will need to have a few years in business to qualify. You may also need to meet a certain minimum credit score requirement. Mostly, you will need to prove historical cash flow, and present your accounts receivables and accounts payables. This is how the lender will determine how much to loan to your business.
There are a number of cash flow based lending options available. Some service providers offer this type of funding, such as PayPal and Square. There are also funding types through other lenders that are closely related, such as those that rely on your accounts receivable or open invoices.
Here’s a little about each one to help you decide if this type of funding is right for you.
#1: PayPal Working Capital Loan
You can get a loan from PayPal if you already have a PayPal business account. There is no personal guarantee requirement, and loan amounts and eligibility depend on your sales via PayPal. Also, applying will not result in a credit check.
To be eligible, you must:
- Have a PayPal Premier or Business account for 90 days or more
- Process at least $20,000 in annual PayPal sales if you have a Premier account, or at least $15,000 in annual PayPal sales if you have a Business PayPal account
- Pay off any existing PayPal Working Capital loan
Repayment is automatic as a percentage of each PayPal sale. As a result, the amount you repay each day changes with your sales volume. The more you sell, the more repayment progress you’ll make that day. On days without sales, you’ll make no payments. Yet, there is a minimum repayment requirement every 90 days.
Depending on the loan terms you choose, you have to pay at least 5% or 10% of your total loan amount, that’s the loan plus the fixed fee, every 90 days. The 5% minimum applies to loans estimated to take 12 months or more to be repaid, based on your business’ past PayPal sales and other factors. The 10% minimum applies to loans that should only take 12 months or less to repay.
#2: Square
You can get similar business loans through Square, and they also will not affect your personal credit score. Eligibility is based on a variety of business factors, including its payment processing volume, account history, and payment frequency. Square will send a customized offer to users based on their card sales through Square, up to $250,000. There is no interest per se. Rather, you’ll pay an ongoing flat fee.
The fixed fee is the difference between the total owed amount and the initial loan amount. The fixed fee will never change, regardless of how quickly or slowly you pay off the loan. Just like PayPal, if sales are up one day, you pay more. Consequently, if you have a slow day, you pay less. A minimum of 1/18 of the initial balance must be repaid every 60 days.
They don’t require collateral for business loans of $75,000 or less. In contrast, for loans over $75,000, they take a security interest in your business assets. Then they will file a UCC statement with the Secretary of State where your business is organized. There is no personal guarantee requirement.
#3: Business Revenue Lending
With a similar basis for getting funding, business revenue lending is another of the cash flow based lending options.
It involves raising capital from investors, who then get a percentage of the enterprise’s ongoing gross revenues in exchange for money invested. Investors get a regular share of business income until the agreed upon amount is paid. Often, this amount is a multiple of the principal investment. It is usually between 3 – 5 times the original amount.
Since repayment of the loan is based on revenues, the time it takes to repay the loan will fluctuate. The faster revenue grows, the quicker you’ll repay the loan, and vice versa. The percentage of monthly revenues committed to repayment can be as high as 10%. Monthly payments will fluctuate with revenue highs and lows and will continue until you pay the loan in full.
Terms for the Credit Suite business revenue lending program are:
- Collateral Required: Consistent revenue verifiable through bank statements
- Loan Amounts: $5,000-$500,000
- Term: 3-36 months
- Factor: 1.10-1.45%
- Credit Requirements: 500 credit score or higher
- No recent bankruptcies
- Business must earn annual revenue of $120,000 or more per year
- You must be in business for a year or more
- The business must do over 5 small transactions each month
- Or bring in at least $15,000 monthly revenue with 6 months’ time in business
- Financial services industries are prohibited
- 6 months business bank statements required with application
#4: Account Receivable Financing
AR financing is another of the cash flow based lending options available. It allows you to use outstanding account receivables as your collateral for business financing. You can get as much as 90% of receivables advanced, and you get the balance after the invoice is paid in full.
Terms for Credit Suite account receivable financing are:
- Collateral Required: Account receivables
- Loan Amounts: $10,000- $10 million
- Term: Up to 95% of receivables can be advanced within a week.
- Rates: Starting at prime rate 2%
- Credit Requirements: Minimum 500 FICO score
- Receivables must come from another business or government agency, not an individual
- Business must be open for at least 1 year to qualify
- Medical receivables must have $1 million in annual sales or more
- Breakdown of existing receivables and a sample invoice required with application
#5: Purchase Order Financing
PO financing is also closely related. This is funding to a business with a large purchase order or contract, but the business is unable to fulfill it. A lender loans the money to complete the order, and charges a percentage for the service. The company can then fulfill its order or contract.
The difference between purchase order and accounts receivable financing is, purchase order financing involves a company lending you money to fulfill purchase orders. Accounts receivable financing involves a company buying outstanding invoices. However, when you get to the center of it all, both are based on cash flow.
Credit Suite purchase order financing requirements:
For approval, lenders will typically review your outstanding purchase orders that need to be filled. They want to be sure the purchase orders are legit and the suppliers you are dealing with are credible.
If so, then you can get approval regardless of personal credit history. Rates tend to range from 1-4%. Furthermore, in some instances, you can get 95% of your purchase order in advance.
Cash Flow Based Lending Options Can Help Take Your Business to the Next Level
The beautiful thing about cash flow based lending is, you can get funds even without a strong credit score. If you are making the sales, you can get the money. That makes it easier to fulfill orders and keep making sales, which in turn allows you to grow your business bigger and stronger than ever.
The post 5 Cash Flow Based Lending Options to Take Your Business to the Next Level appeared first on Credit Suite.
New comment by sergeEmber in "Ask HN: Who is hiring? (February 2022)"
Ember | Senior Full Stack Developer | Full Time | EU Remote
We’re Ember – A SaaS platform that allows business owners to manage their business finances and obligations, easily and in one place.
Since launching last year, we’ve established a clear product-market fit, successfully raised our £1.6m Seed round, and have become one of the fastest-growing start-ups in the UK today – with over 500 businesses running on Ember.
We’re looking for a Senior Full Stack Engineer to join our tight-knit team (currently 5 developers strong) and help us deliver on our ambitious roadmap. As a senior member of the team, you’ll also be heavily involved in helping us define direction both from a technical and product standpoint.
For more details and to apply – https://apply.workable.com/emberdigital/j/54CA7F6670/
New comment by lazyPigeon in "Ask HN: Who wants to be hired? (February 2022)"
New Delhi, India\\ Both\\ Yes\\ python, SQL, Power Bi, GIT, Data Analysis, Data Visualization \\ https://drive.google.com/file/d/1UphO3THr-u8NtlzPhRWk8Rx9dDY… \\ prateeksohlot22@gmail.com The post New comment by lazyPigeon in “Ask HN: Who wants to be hired? (February 2022)” first appeared on Online Web Store Site. The post New comment by lazyPigeon in "Ask HN: Who wants to be hired? … Continue reading New comment by lazyPigeon in "Ask HN: Who wants to be hired? (February 2022)"