Tag: Business

Check Out the Latest Business Credit Cards No Annual Fee

Consider Business Credit Cards No Annual Fee and What They Can Do for Your Business

Looking for business credit cards no annual fee? Look no further. We’ve got you covered.

We looked into lots of company credit cards for you. So, here are our selections.

Most of these have an ongoing annual fee of $0 (versus just an introductory fee). You can get a lot of cash with business credit cards.

And you will not need collateral, cash flow, or financials to get small business credit.

Company Credit Card Benefits

Benefits can differ. So, make sure to choose the benefit you prefer from this choice of options.

And always check rates on the appropriate site.

Business Credit Cards No Annual Fee for Fair Credit

Capital One® Spark® Classic for Business

Take a look at the Capital One® Spark® Classic for Business. It has no annual fee. There is no introductory APR offer. The regular APR is a variable 26.99%. You can earn unlimited 1% cash back on every purchase for your company, without any minimum to redeem.

While this card is available if you have average credit, beware of the APR. Nonetheless if you can pay on time, and in full, then it’s a deal.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-classic/

Business Credit Cards No Annual Fee for Jackpot Rewards That Never Expire

Capital One ® Spark® Cash Select for Business

Take a look at the Capital One ® Spark® Cash Select for Business card. It has no annual fee. You can get 1.5% cash back on every purchase. There is no restriction on the cash back you can earn. Also earn a one-time $200 cash bonus as soon as you spend $3,000 on purchases in the very first 3 months. Rewards never expire.

Pay a 0% introductory APR for 9 months. Then pay 13.99%– 23.99% variable APR afterwards.

You will need great to outstanding credit scores to qualify.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-cash-select/

Establish business credit fast with our research-backed guide to 12 business credit cards and lines.

Business Credit Cards No Annual Fee (Introductory) for Cash Back

Flat-Rate Rewards

Capital One ® Spark® Cash for Business

Take a look at the Capital One ® Spark® Cash for Business card. It has an introductory $0 annual fee for the first year. Afterwards, this card costs $95 each year. There is no introductory APR offer. The regular APR is a variable 20.99%.

You can get a $500 one-time cash reward after spending $4,500 in the initial three months from account opening. Get unlimited 1.5% cash back with Cash Select.

You will need great to superior credit to qualify.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-cash/

Flat-Rate Rewards and No Annual Fee

Discover it ® Business Card

Look into the Discover it ® Business Card. It has no yearly fee. There is an introductory APR of 0% on purchases for one year. After that the regular APR is a variable 14.49– 22.49%.

Get unlimited 1.5% cash back on all purchases, with no category restrictions or bonuses. They double the 1.5% Cashback Match ™ at the end of the initial year. There is no minimal spend requirement.

You can download transactions rapidly to Quicken, QuickBooks, and Excel. Keep in mind: you will need great to exceptional credit scores to get this card.

https://www.discover.com/credit-cards/business/

Bonus Categories

Ink Business Cash℠ Credit Card

Check out the Ink Business Cash℠ Credit Card. It has no annual fee. There is a 0% initial APR for the first year. After that, the APR is a variable 13.24– 19.24%. You can get a $750 one-time cash bonus after spending $7,500 in the first 3 months from account opening.

You can get 5% cash back on the initial $25,000 spent in combined purchases at office supply stores and on internet, cable, and phone services each account anniversary year.

Get 2% cash back on the first $25,000 spent in combined purchases at gasoline stations and restaurants each account anniversary year. Earn 1% cash back on all other purchases. There is no limit to the amount you can earn.

You will need exceptional credit scores to get approved for this card.

Find it here: https://creditcards.chase.com/business-credit-cards/ink/cash?iCELL=61GF

Boosted Cash Back Categories

Bank of America ® Business Advantage Cash Rewards MasterCard ® credit card

Look at the Bank of America ® Business Cash Rewards MasterCard ® credit card. Get an 0% introductory APR for the initial 9 billing cycles of the account. Afterwards, the APR is 12.24%– 22.24% variable. There is no annual fee. You can get a $300 statement credit offer.

Get 3% cash back in the category of your choice. So these are gas stations (default), office supply stores, travel, TV/telecom & wireless, computer services or business consulting services. Earn 2% cash back on dining. So this is for the initial $50,000 in combined choice category/dining purchases each calendar year. Afterwards earn 1% after, with no restrictions.

You will need excellent credit to qualify.

Find it here: https://www.bankofamerica.com/smallbusiness/credit-cards/products/cash-rewards-business-credit-card/

Corporate Credit Cards for Extravagant Travel

No Annual Fee

Bank of America ® Business Advantage Travel Rewards World MasterCard® credit card

For no annual fee while still getting travel rewards, check out this card from Bank of America. It has no yearly fee and a 0% initial APR for purchases during the first 9 billing cycles. After that, its regular APR is 12.24– 22.24% variable.

You can get 30,000 bonus points when you make a minimum of $3,000 in internet purchases. So this is within 90 days of your account opening. You can redeem these points for a $300 statement credit towards travel purchases.

Get endless 1.5 points for every $1 you spend on all purchases, everywhere, each time. And this is no matter how much you spend.

Also earn 3 points per every dollar spent when you book your travel (automobile, hotel, airline) with the Bank of America ® Travel Center. There is no restriction to the number of points you can get and points do not expire.

You can earn up to 75% more points on every purchase if you have a company checking account with Bank of America and qualify for Preferred Rewards for Business.

You will need superb credit scores to get this one (as in, 700s or better).

Find it here: https://www.bankofamerica.com/smallbusiness/credit-cards/products/travel-rewards-business-credit-card/

Flat-rate Travel Rewards: No Annual Fee for First Year

Capital One ® Spark® Miles for Business

Check out the Capital One ® Spark® Miles for Business card. It has no annual fee for the initial year, which after that rises to $95. The regular APR is 20.99%, variable due to the prime rate. There is no introductory annual percentage rate. Pay no transfer charges. Late fees go up to $39.

This card is terrific for travel if your costs do not come under basic bonus categories. You can get unlimited double miles on all purchases, without limitations. Earn 5x miles on rental cars and hotels if you book through Capital One Travel.

Get an initial bonus of 50,000 miles. That’s the same as $500 in travel. But you only get it if you spend $4,500 in the first 3 months from account opening. There is no foreign transaction cost. You will need a good to exceptional FICO rating to qualify.

Earn 50,000 bonus miles if you spend at least $4,500 within 3 months of your rewards membership enrollment date.

Find it here: https://www.capitalone.com/small-business/credit-cards/spark-miles/

Establish business credit fast with our research-backed guide to 12 business credit cards and lines.

Business Credit Cards No Annual Fee for Fair to Poor Credit Scores, Not Calling for a Personal Guarantee

Brex Card for Startups

Look into the Brex Card for Startups. It has no annual fee.

You will not need to give your Social Security number to apply. And you will not need to provide a personal guarantee. They will take your EIN.

Nevertheless, they do not accept every industry.

Also, there are some industries they will not work with, as well as others where they want more paperwork. For a list, go to https://brex.com/legal/prohibited_activities/.

To establish creditworthiness, Brex checks a company’s cash balance, spending patterns, and investors.

You can get 7x points on rideshare. Get 4x on travel. Also, get triple points on restaurants. And get double points on recurring software costs. Get 1x points on everything else.

You can have poor credit, (even a 300 FICO) to qualify.

Find it here: https://brex.com/lp/startups-higher-limits/

Establish business credit fast with our research-backed guide to 12 business credit cards and lines.

Company Credit Cards with a 0% Initial APR– Pay Zero!

Blue Business® Plus Credit Card from American Express

Take a look at the Blue Business® Plus Credit Card from American Express. It has no annual fee. There is a 0% initial APR for the first year. Afterwards, the APR is a variable 13.24– 19.24%.

Get double Membership Rewards® points on everyday business purchases like office supplies or client dinners for the first $50,000 spent annually. Get 1 point per dollar after that.

You will need good to exceptional credit scores to qualify.

Find it here: https://creditcard.americanexpress.com/d/bluebusinessplus-credit-card/

American Express ® Blue Business Cash Card

Also have a look at the American Express ® Blue Business Cash Card. Note: the American Express ® Blue Business Cash Card the same as the Blue Business® Plus Credit Card from American Express. Yet its rewards are in cash as opposed to points.
Get 2% cash back on all qualified purchases on as much as $50,000 per calendar year. Afterwards obtain 1%.
It has no annual fee. There is a 0% initial APR for the first 12 months. After that, the APR is a variable 13.24– 19.24%.
You will need great to outstanding credit to qualify.
Find it here: https://creditcard.americanexpress.com/d/business-bluecash-credit-card/

The Very Best Small Business Credit Cards No Annual Fee for You

Your straight-out perfect business credit cards no annual fee will depend upon your credit history and scores.
Only you can pick which features you want and need. So, do your research. What is exceptional for you could be terrible for another individual.
And, as always, make certain to establish credit in the recommended order for the best, quickest benefits.

The post Check Out the Latest Business Credit Cards No Annual Fee appeared first on Credit Suite.

How to Use Equipment Financing and Leasing In Your Business

It’s hard to grow any business, whether new or established, without the necessary equipment. However, some of it can be expensive. For a new business specifically, affording equipment can feel impossible. Still, you need that equipment to make money, which lends itself to a frustrating cycle. The answer may be equipment financing and leasing.

Equipment Financing and Leasing Is a Great Option for Both New and Established Businesses

Equipment financing is when you use a loan or lease to purchase or borrow hard assets for your business. You can use it to buy or lease any physical asset. This can include items like an industrial freezer in a restaurant or an oven or a company car, you name it.

A recent report, the Equipment Leasing and Finance Association (ELFA) survey, found that 80% of American businesses lease a portion of their equipment. The list of companies using leasing includes everything from Fortune 500 companies to mom and pop shops.

Benefits of Equipment Financing and Leasing

There are many benefits to equipment financing and leasing. For example, you will pay a set amount each month, which makes budgeting easier.  Also, you can build business credit if your creditor reports your payment to the business credit reporting agencies. The equipment is the collateral. That means you do not have to potentially sacrifice any other assets.

Find out why so many companies use our proven methods to get business loans.

In addition, it’s easy to upgrade equipment after your lease ends.  This can be helpful if your equipment is something like a computer which quickly becomes obsolete. 

What’s the Catch? 

Of course, nothing is perfect.  You may have to make a large down payment.  Furthermore, you will often need to have good personal credit in order to qualify.  If your financed equipment becomes outdated, your business is stuck with it until the end of the lease or loan. Sometimes, leases can end up actually costing more than purchasing. When the lease ends, you  have to get  a new lease or to make other arrangements. Whereas, if you buy the equipment outright you can sell it if you want. 

Types of leases

There are a few different types of leases. Which one will work best for you will depend on a number of factors. 

Fair Market Value Leasing

This is also called an FMV lease. With an FMV lease, you make regular payments while borrowing the equipment for a set term. When the term is up, you have the option to return the equipment or purchase it at its fair market value.

$1 Buyout Lease

This is a type of capital lease in which you pay off the cost of the equipment plus interest over the course of the lease.  At the end, you owe only $1.  Then, when you pay the $1 you fully own the equipment. This is similar to a loan in structure, and cost as well.

10% Option Lease

This lease is the same as a $1 lease, except at the end of the term you can buy the equipment for 10% of its cost.  These leases typically have lower monthly payments than the $1 buyout option. 

How Much Can a Lease Cost?

Of course it varies, but here is an example. Say the total cost of the equipment you are leasing is $25,000.  If it is a 10% option with a 36 month term, with an interest rate of 15%, it looks like this: 

  • Monthly payment is $780
  • Total cost of the lease is $28,079
  • The cost to purchase at the of the lease is $2,500
  • And the total Cost of Equipment is $30,579

Find out why so many companies use our proven methods to get business loans.

In this case,  you would be paying an extra $5,579 over the course of the lease. That is over 1/5 added to your total cost for the equipment. If you bought the equipment outright you would pay $25,000. Of course, you would then be out  $25,000 cash all at once.  When you are leasing equipment, you pay out over the life of the lease and thus keep more working capital actually working for your business. 

Credit Suite Offers Equipment Financing and Leasing

You can take advantage of our equipment financing and leasing programs if you have been in business at least one year.  Even if your credit is not the greatest, we have options that may work. Even better, approval takes as little as 24 hours.

The minimum personal credit score requirement is 550. Generally speaking, this is considered a fair credit score, and thus much lower than what many lenders will want to see. You will also need to provide details on the equipment you are getting.  You can be approved for as much as $10,000,000 in equipment financing after a quick credit review. This type of financing often affords more favorable terms than typical business financing programs and better benefits. Our equipment financing programs work for both established and startup businesses. We work with hundreds of lenders, and we can help you find the perfect one for your needs. 

Equipment Financing and Leasing Rates and Payments

You can qualify with only two monthly payments as a down payment.  Rates are affordable, and interest is 100% tax deductible.  In addition, there is no application fee. Furthermore, the time from application to funding is generally 2 weeks or less.

Interest rates range from 7% to 25%, and depending on the amount of the loan and risk factors, you may have to provide 2 years of corporate and personal tax returns.

Are There Other Options for Funding Equipment? 

Of course, we already mentioned paying cash and taking out a traditional loan. If you have accounts receivables you can do receivables financing. That’s really better for funding cash gaps. However, if you need to collect receivable to be able to afford your equipment, it could work.

Another option is the Credit Line Hybrid. This is unsecured business financing. There are no documents required, and you can get up to $150,000.  You do have to have a credit score of at least 680 and meet some other requirements. However, if you do not qualify on your own, you can take on a credit partner that does meet the criteria.  One bonus of this option is that you can purchase the equipment outright.  Since many of the cards that are part of the Credit Line Hybrid sometimes offer low introductory rates for a short time, you could save on interest.

Find out why so many companies use our proven methods to get business loans.

Is Equipment Financing and Leasing the Right Option for Your Business?

The short answer is, it depends.  That begs the question, what does it depend on. Well, first, do you need equipment?  That’s what this type of financing is best for. Then, do you need to finance equipment? If you have the cash on hand, you need to consider it carefully.  Financing can be a good idea if you would deplete your cash reserves paying cash for equipment.

Of course, you could just take out a traditional loan. However, you may have to come up with other collateral. If you need finance equipment, using that equipment as the collateral is the easiest solution. The collateralization allows for generally better rates and terms than you would get otherwise. Contact Credit Suite today to find the best option for equipment financing for your business.

The post How to Use Equipment Financing and Leasing In Your Business appeared first on Credit Suite.

5 Reasons Why You May Need an Online Business Loan

These days you can find anything online. In fact, you can even find an online business loan.  Some business owners shy away from this option because of the fear of predatory lending. It is possible to find online lenders that will work for your business though.  Is an Online Business Loan for You? So, is … Continue reading 5 Reasons Why You May Need an Online Business Loan

5 Steps to Get a Business Credit Card, Bad Credit or Not

If you have bad personal credit, you may find yourself struggling to get a business credit card. The key to getting a business credit card, bad credit or not, is business credit. 

You Can Get a Business Credit Card, Bad Credit Not Being an Issue

You’re likely aware business credit is a good thing.  You know you need it to help you fund your business.  But do you know how it helps you specifically get credit cards, even if you have bad personal credit? Furthermore, do you know how to get it? 

How Do You Get Business Credit? 

Business credit doesn’t just happen like personal credit does.  You have to work to build business credit intentionally. While not hard, it is a process, and a time consuming one at that. The sooner you start the better, especially if you need a business credit card, bad credit being an issue. 

Business Credit Card Bad Credit: Separation is Key

First thing’s first. You have to establish your business as an entity separate from yourself the owner. This means not using your own name or address. That doesn’t mean you have to get a separate phone line, or even a separate location.  

You do need separate contact information however.  You can get a business phone number pretty easily that will work over the internet instead of phone lines.  In addition, the phone number will forward to any phone you want it too so you can simply use your personal cell phone or landline if you want.  Whenever someone calls your business number it will ring straight to you. 

You can use a virtual office for a business address. This is a business that offers a physical address for a fee, and sometimes they even offer mail service and live receptionist services.  In addition, there are some that offer meeting spaces for those times you may need to meet a client or customer in person. 

business credit card bad credit Credit Suite

Learn more here and start building business credit with your company’s EIN, not your SSN. 

Business Credit Card Bad Credit: EIN not SSN

The next thing you need to do is get an EIN for your business.  This is an identifying number for your business that works in a way similar to how your SSN works for you personally.  Some business owners used their SSN for their business. This is what a lot of sole proprietorships and partnerships do.  However, it really doesn’t look professional to lenders, and it can cause your personal and business credit to get all mixed up.   You can get one for free from the IRS.

This step is vital.  When you apply for a business credit card, bad credit can get in the way mainly because your SSN signals a look at your personal credit.  If you use your EIN instead of your SSN, the lender will only be seeing the credit attached to your business. 

Business Credit Card Bad Credit: Incorporation is Not Optional

Incorporating your business as an LLC, S-corp, or corporation is necessary for separation of business from the owner, and many other things. .  It lends credence to your business as one that is legitimate. It also offers some protection from liability. 

Which option you choose does not matter as much for these purposes as it does for your budget and needs for liability protection.  The best thing to do is talk to your attorney or a tax professional.  

Business Credit Card Bad Credit: Separate Bank Account

You have to open a separate, dedicated business bank account.  There are a few reasons for this.  First it helps solidify the separation between yourself and your business.  Also, it will help you keep track of business finances. This is important for tax purposes. 

There’s more to it however.  There are several types of funding you cannot get without a business bank account.  Many lenders and credit cards want to see one with a minimum average balance.  In addition, you cannot get a merchant account without a business account at a bank. That means, you cannot take credit card payments.  Studies show consumers tend to spend more when they can pay by credit card.

business credit card bad credit Credit Suite

Learn more here and start building business credit with your company’s EIN, not your SSN. 

Business Credit Card Bad Credit: Starter Vendors

Now, once you have these things in place,  you need to get accounts that will report your payments to the business credit agencies. It sounds easy enough, but the catch is, you have to find vendors that will extend credit without you first having credit. 

We call these vendors starter vendors.  They will extend net terms on invoices with little requirement. They don’t check credit. Typically, they require a certain number of days in business, a minimum average balance in a business bank account, minimum annual revenue, or some combination of these things. 

Extending the credit isn’t enough however.  There are some that do this, but there are far fewer that will actually report those payments.  You need vendors to report payments to the business credit reporting agencies, thus building your business credit score. 

The Snowball Effect

Of course you are wondering what any of this has to do with applying for a business credit card, bad credit being in the way. Here’s how.  Once you have several of these starter vendor accounts reporting, your score will be strong enough to support store credit. 

A business store account is usually issued for that specific store or website specifically.  Their limits are usually on the lower side as well.  However, after you get a few of them and use them responsibly. Your score will grow even strong. These are cards from places like Home Depot, Staples, or Best Buy. 

Then, you should qualify for fleet credit. These are cards from places like Shell that are used specifically for gasoline and automotive repair and maintenance.  

After a few of those are reporting your consistent, on-time payments, you should have a strong business credit score and be able to apply for standard business credit cards that are not limited by where you use them or what you use them to buy. By using your EIN and not your SSN, you can get a business credit card, bad credit on your personal credit report and all. It’s all a big snowball effect. 

business credit card bad credit Credit Suite

Learn more here and start building business credit with your company’s EIN, not your SSN. 

In the Interim

In the meantime, you can give your business credit building efforts a kickstart with a card like the Brex card for startups.  It  is one of the few true options if you are looking for a business credit card, back credit not being an issue.  Even a FICO as low as 300 may qualify.  There is no annual fee, and you can apply with your EIN rather than your SSN.  There is no personal guarantee requirement. 

The only catch is, not all industries qualify, and some industries require more paperwork than others.

You could also try getting accounts that you already have a relationship with to report to the business credit reporting agencies. This could be vendors you work with already. Maybe ask them if they will consider net terms and reporting payments. If you already make your payments consistently on time, they may be willing to do so without a credit check. 

You could also consider asking utilities that you already pay regularly to report your payments.  They may say no. They don’t have to do it. But they might, and if they do it can only help your business credit grow faster. 

A credit line hybrid can be another great option to help speed things along. You have to have a 680 or better personal credit score, but you can take on a credit partner if you don’t meet that. The account still reports to your business credit, so you can keep building your score. And, you can get up to $150,000 unsecured financing for your business. 

An Expert Can Help You Through the Steps 

It sounds easy enough to do all of this on your own.  However,  there are some steps that are easier than others. Specifically, it can be very difficult to find starter vendors that will report to your business credit. For this and other difficult steps, it can be very helpful to have a business credit expert help you out. It’s definitely worth considering. 

 

The post 5 Steps to Get a Business Credit Card, Bad Credit or Not appeared first on Credit Suite.

Don’t Let Accounts Receivables Sink Your Business

Accounts receivables are a necessary part of many businesses. A lot of potential customers can be lost if you do not allow businesses to pay invoices with net terms, whether 30, 60, or 90 days.  However, you can lose a lot of money if you don’t collect on those receivables.  How do you offer the benefit, without suffering the consequences?

How to Manage the Double Life of Accounts Receivables

Accounts receivables really can lead a double life of sorts. On the one hand, they lure in customers with their appeal.  On the other hand, they can cause major cash gaps simply by their nature. Those gaps can fill with unpaid obligations quickly if there is no bridge over them. 

Bridging the Gap of Accounts Receivables

So, the question becomes, how do you enjoy the benefits without the gaps. The answer is accounts receivable financing. In fact, this answers more than one question.  Not only is it a way to bridge cash gaps, but it is also a way to fast access to cash for other needs.

For example, you may not have an unmanageable cash gap, but rather you need to take advantage of special pricing on a bulk purchase. Maybe you do not want to exhaust your cash on hand, or you do not have the cash on hand. Either way, you can leverage your accounts receivable to finance more than just cash flow issues due to slow collections. 

How Does Accounts Receivables Financing Work?  

Credit Suite can help you get up to $10 million in account receivable financing.  Up to 80% of receivables can be advanced within 24 hours.  Interest rates range from 8% to 12% currently. The minimum credit score requirement is 500, and the receivables must be from another business or government agency, not an individual.  You also have to be in business for at least one year.. In addition to an application, you’ll need to provide a breakdown of existing receivables and a sample invoice.

Find out why so many companies use our proven methods to get business loans.

This is an ideal way to access fast cash for your business for a number of reasons, especially if your credit isn’t the best. Not only that, but the interest rates are much more reasonable than that of most credit 

cards.

Merchant Cash Advance

If you accept credit cards as payment, you have another, similar option to accounts receivables financing. 

It’s called a merchant cash advance.  Our merchant financing program is a good fit for businesses that accept credit cards and need fast, easy financing.  You can get up to $500,000 without collateral and a minimum credit score as low as 500.

You only have to turn over bank statements to prove cash flow.  The lenders we work with do not ask for other documents such as financials, business plans, resumes, or any of the other documents traditional lenders typically ask for.

Just  4-6 months of your bank and merchant account statements is all it takes. They just want to see consistent deposits and annual revenue of $50,000 or higher. Also, you do have to have been in business for 6 months or more.

They will also look to see if there are a lot of Non-Sufficient-Funds showing on your bank statements, or low chargebacks on your merchant statements.  More than 10 deposits in a month going into your bank account is a key positive factors

Lenders want to see that you manage your bank and merchant accounts responsibly and have a fair number of consistent credit card transaction deposits each month.

What if You Do Not Have Accounts Receivables or Accept Credit Cards?

Maybe you don’t have accounts receivable. That may mean you do not have the cash gaps that can come with them, but you might still need cash access anyway.  There are other options. One of the most flexible but least known types of business financing is the Credit Line Hybrid.

A credit line hybrid is unsecured business financing.  It allows you to fund your business without putting up collateral, and you only pay back what you use.

Find out why so many companies use our proven methods to get business loans

Unlike accounts receivables financing, you do need good personal credit to qualify for the Credit Line Hybrid on your own. Your personal credit score should be at least 685.  In addition, you can’t have any liens, judgments, bankruptcies or late payments.  Furthermore, in the past 6 months you should have no more than 4 credit inquiries, and you should have less than a 45% balance on all business and personal credit cards.  It’s also preferred that you have established business credit as well as personal credit.

However, there is a way around those requirements if you don’t meet them. You can take on a credit partner that meets each of these requirements.  Many business owners work with a friend or relative to fund their business.  If a relative or a friend meets all of these requirements, they can partner with you to allow you to tap into their credit to access funding. 

Top Ways to Use Funds from A/R Financing, Merchant Cash Advances,  and The Credit Line Hybrid

The Credit Line Hybrid is an option if you do not have accounts receivable or do not accept credit card payments. However, if you qualify for more than one, you can combine them for even more powerful business funding. 

You can use each one separately or together to do any of the following, and more!

  • Pay off higher interest debt to lower monthly payments.  
  • Bridge a cash gap due to slow collections or seasonal issues. You could never have to worry or stress about large invoices being paid slowly or slow business in the off season ever again.
  • Cover bills during a global pandemic. Can you relate?
  • Purchase inventory in bulk to take advantage of promotional pricing. 
  • Grow and expand your business by adding equipment, adding on to your building, or even opening a new location.
  • Fund updates and repairs. Don’t let the little things, or big things, slide because you can’t pay for it.

Find out why so many companies use our proven methods to get business loans

That said, the Credit Line Hybrid does have one bonus that the accounts receivables funding and merchant cash advance does not.  The Credit Line Hybrid reports to your business credit report, in turn helping you build a stronger business credit score. 

Why Does Your Business Credit Report Matter? 

If you made it here from a quick search about accounts receivables financing, you may be asking yourself what on earth a business credit report has to do with anything. The quick and dirty is, a strong business credit score can increase fundability and allow you to access even more funding for your business. 

Fundability is the overall ability of your business to get funding.  Not sure where you stand or what kind of funding you can get? Try a free consultation.

Accounts Receivables Financing Can Be a Lifeboat for Your Business

Accounts receivables can truly be a blessing or a curse. They are a great tool to help you draw more business. The ability to pay later is a huge benefit, and it can make the difference between a potential customer lost and a new customer.

However, if collections become an issue, the curse can kick in.  Accounts receivables financing is a great way to overcome the curse and keep the blessing. That’s not the only way to use this kind of financing though. 

Your accounts receivables can be leveraged to get funding your business can use to not only survive, but to thrive. If you do not qualify, a merchant cash advance or the Credit Line Hybrid can help as well.  If you qualify for all three, you can get triple the funding to grow even more!

The post Don’t Let Accounts Receivables Sink Your Business appeared first on Credit Suite.

Business Bankruptcy Basics

Is a Business Bankruptcy in Your Business’s Future?

If your business is having issues, business bankruptcy might be on your mind. But before you go ahead, there are some things you should know.

Business Failures

No one likes to think about it, but there’s a chance your business just plain won’t catch on. Maybe no one will buy your products or services, or expenses like rent could drive you out of business, or mismanagement could do your business in.

According to the SBA, about 20% of all businesses fail within their first year. About half survive for five years. But at about the eighth year or so, survival rates tend to flatten out.

Business Failures and the Economy

Before Covid-19, a bad economy didn’t really impact survival rates. Per the SBA, a boom or a bust economy didn’t really change things. But in July of 2020, per the New York Times, the number of small business failures was likely over 100,000.

Business Failures and Industries

Before Covid-19, the SBA said industries didn’t matter too much when it came to business failure rates. But food services and hotels tended to do better then. Not so during the age of Covid-19. Lockdowns and the need to work from home have taken their toll.

Business Failures, Industries, and Covid-19

Per Business Insider, the hardest hit industries are:

  1. Hotels, restaurants, bars, amusement parks, and casinos
  2. Sporting events, the performing arts, and scenic transportation (boat tours, etc.)
  3. Home furnishings stores and clothing stores
  4. Motion picture and sound recording
  5. Dental offices, and
  6. Laundry and other personal services

Business Failures: The Reasons Why

Before Covid-19, FreshBooks said these are the top reasons why a business might fail:

  1. Not enough demand
  2. Lack of cash
  3. Dysfunctional team
  4. Competition
  5. Pricing issues

Business Futures During Covid-19

According to the National Academy of Sciences, a July 2020 survey of over 5,000 small businesses (not just science-based) revealed, if a business had more cash on hand, its ownership was more confident they would stay in business. Then again, nearly all of the entrepreneurs surveyed believed the crisis would be over before January 1, 2021.

Business Bankruptcy

Bankruptcy is a process a business goes through in federal court. It is designed to help a business eliminate or repay its debt under the guidance and protection of the bankruptcy court. Business bankruptcies are often described as liquidations or reorganizations. This depending on the type of bankruptcy an entrepreneur takes.

3 Types of Business Bankruptcy

There are three types of business bankruptcy:

  1. Chapter 7
  2. Chapter 11
  3. and Chapter 13

These types depend on organizational structure.

Chapter 7 and Chapter 11

Corporations and partnerships are legal business entities separate from their owners, although corporations are more truly separate than partnerships. Either type of structure commonly will file of Chapter 7 (bankruptcy protection), or Chapter 11 (reorganization). The chapters refer to the US Bankruptcy Code.

Demolish your funding problems with 27 killer ways to get cash for your business.

Chapter 7: Liquidation

This one may be the best choice when the business has no viable future. It is typically for when the debts of the business are so overwhelming that restructuring them is not feasible. Chapter 7 bankruptcy can be for sole proprietorships, partnerships, or corporations. It is also appropriate when the business does not have any substantial assets.

If a business is a sole proprietorship, and an extension of an owner’s skills, it usually does not pay to reorganize it. Hence Chapter 7 is appropriate.

But before a Chapter 7 bankruptcy gets approval, the applicant is subject to a means test. If their income is over a certain level, their application does not get approval. But if a Chapter 7 bankruptcy gets approval, the business is dissolved.

Working with a Trustee in a Chapter 7 Business Bankruptcy

In a Chapter 7 bankruptcy, a trustee is appointed by the bankruptcy court. The trustee’s job is to take possession of the assets of the business and distribute them among the creditors. The order in which creditors are paid can depend on the type of debt (secured vs. unsecured).

After the assets are distributed and the trustee is paid, a sole proprietor receives a “discharge” at the end of the case. This means that the owner of the business is released from any obligation for the debts. But partnerships and corporations do not receive a discharge.

Chapter 11: Business Reorganization

Chapter 11 may be a better choice for businesses that may have a realistic chance to turn things around. It is usually for partnerships and corporations.  It is also for sole proprietorships if their income level is too high to qualify for Chapter 13 bankruptcy.

Chapter 11 is a plan where a company reorganizes and continues in business under a court-appointed trustee. The company files a detailed plan of reorganization outlining how it will deal with its creditors. The company can terminate contracts and leases, and recover assets. And it can repay a portion of its debts, while discharging others to return to profitability.

The business presents the plan to its creditors who will vote on the plan. If the court finds the plan is fair and equitable, it will approve the plan. Reorganization plans provide for payments to creditors over some time. Chapter 11 bankruptcies are very complex and not all of them succeed. It usually takes over a year to confirm a plan.

Demolish your funding problems with 27 killer ways to get cash for your business.

 Chapter 11 and the Small Business Reorganization Act of 2019

The Small Business Reorganization Act of 2019 enacted a new subchapter V of Chapter 11. The act went into effect as of February 20, 2020. This subchapter of Chapter 11 seems to favor the side of the applicant for business bankruptcy. But it only applies if the applicant wants it to apply.

For example, subchapter V does not require the appointment of a committee of creditors. And it doesn’t require for creditors to approve a court plan.

Per the US Department of Justice, the act: “imposes shorter deadlines for completing the bankruptcy process, allows for greater flexibility in negotiating restructuring plans with creditors, and provides for a private trustee who will work with the small business debtor and its creditors to facilitate the development of a consensual plan of reorganization.”

Chapter 13: Adjustment of Debts for Individuals with Regular Income

Since a sole proprietorship is an extension of its one owner, the owner is responsible for all assets and liabilities of the firm. It is most common for a sole proprietorship to take bankruptcy by filing for Chapter 13. This is a reorganization bankruptcy.

Chapter 13 is for small businesses when a reorganization is the goal instead of liquidation. The entrepreneur files a repayment plan with the bankruptcy court. This details how they are going to repay their debts. But note that Chapter 13 and Chapter 7 bankruptcies are very different for businesses.

Chapter 13 is vital for individuals whose personal assets are tied up with their business assets. This is because they can avoid problems like losing a home if they file Chapter 13, instead of Chapter 7. And Chapter 13 lets a business stay in business and pay its debts, while Chapter 7 does not.

Preventing Bankruptcy

You can’t prevent every bankruptcy. But for the ones where a lack of cash is the issue, getting access to more money can pull a business out of the hole. Many entrepreneurs may not even realize where they can get cash.

Preventing Bankruptcy: Access to More Cash

Entrepreneurs may feel their only options are to go to a big, traditional bank, or turning to their family and friends for a handout. But it doesn’t have to be that way! There are all sorts of alternative ways to get money. Let us help you navigate them and keep YOUR business afloat.

Demolish your funding problems with 27 killer ways to get cash for your business.

Business Bankruptcy: Takeaways

Many businesses fail within the first five years of operation. There are many causes, and the Covid-19 crisis has only made things worse. There are three forms of bankruptcy a business can file for, although Chapter 13 is just for sole proprietors. Chapters 7 and 11 are for sole proprietors, partnerships, and corporations

For corporations and partnerships, the choice between Chapter 7 and Chapter 11 is the choice between liquidation and reorganization. For both Chapter 7 and Chapter 11 bankruptcies, there’s the appointment of a trustee. But in Chapter 7, the trustee distributes remaining assets among the creditors. And in Chapter 11, the trustee works with a plan to reorganize the business in order to try to save it. We can help you avoid a business bankruptcy if a lack of cash is your problem. Let’s weather the storm together.

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Comparing Types of Small Business Loans

Businesses need funding. It’s that simple. You would be hard pressed to find a business owner that doesn’t know that. However, what many do not know, is that there are more options than just traditional bank loans. In fact, here are 6 different types of small business loans, and that is just the tip of the iceberg. 

7 Types of Small Business Loans and Which One Is Right for You

Knowing the different types of small business loans is only half the battle.  Then, you have to figure out which one is right for your business.  The answer will depend on a number of things. Sometimes, you may not even get a choice. You may have to take what you can qualify for.  Still, knowing your options is the first step. Then, you can work on putting your business in a position to qualify for what will work best if you aren’t there yet. 

What Types of Small Business Loans are Most Common? 

  1. Types of SBA Loans

There are several types of SBA loans.  These are small-business loans guaranteed by the Small Business Administration and issued by participating lenders, mostly banks. They can guarantee up to 85% of loans of $150,000 or less, and loans that are more than $150,000 they will guarantee up to 75%. The maximum loan amount they offer is $5 million. 

Due to the fact that these are SBA loans, meaning that they have a government guarantee, financial institutions are able to offer them at lower interest rates.

types of small business loans Credit Suite

Credit Line Hybrid Financing:  Get up to $150,000 in financing so your business can thrive.

What are the SBA Loan Options? 

Again, there are many types of SBA loans for various kinds of businesses and needs. Here are just a few. 

7(a) Loans 

This is the Small Business Administration’s flagship loan program. It offers federally funded term loans up to $5 million. The funds can be used for expansion, purchasing equipment, working capital and more. Banks, credit unions, and other specialized institutions, in partnership with the SBA, process these loans and disburse the funds.

504 Loans

These loans are also available up to $5 million and can buy machinery, facilities, or land. They are generally used for expansion.  Private sector lenders or nonprofits process disburse the funds.  Specifically, they work well for commercial real estate purchases.

Microloans 

Microloans are available in amounts up to $50,000. They work for starting a business, purchasing equipment, buying inventory, or for working capital. Contrary to most other SBA loan programs, financing comes directly from the Small Business Administration, with community based non-profits acting as intermediaries.

SBA disaster loans

Available in amounts up to $2 million, these funds are processed directly through the SBA as well. They are available to small-business owners that have been affected by natural disasters.

SBA Express loans

The turnaround for express loans is much faster, with the SBA taking up to 36 hours to give a decision. Necessary paperwork for application is less also, making express loans a great option for working capital, among other things, if you qualify. 

What Are the Best Government Small Business Loans? 

The 7(a) program is by far the most versatile. The funds can be used for a number of business needs. If you qualify, they are a great option. Credit Suite can help you get funding through this program. 

  1. Types of Small Business Loans: 401(k) Financing

Your existing 401(k) or IRA can help fund your business as well. The funds work as collateral for business financing. This program uses IRS proven strategies. Furthermore, you will pay no tax penalties, and you still earn interest on your 401(k). Rates are low, and this option usually has a quick closing and funding process as well. 

  1. Types of Small Business Loans: Merchant Cash Advances

If you accept credit cards as payment, you may qualify for a merchant cash advance.  The minimum credit score is 500.  Also, your business must bring in $100,000 or more per year in credit card sales.  Typical approval amounts equal one months’ credit processing volume.  So, you’ll also need 3-6 months of bank and merchant statements. 

  1. Types of Small Business Loans: Equipment Financing

This is one way to get financing to buy or lease new equipment.  Rates vary widely based on risk factors, but usually you can get approval with a credit score of 650 or better.

The lender will undervalue equipment by perhaps up to 50%. Remember, this is on major equipment only. Lenders won’t combine a lot of small equipment. You can get loans up to $2 million.

Equipment Sale – Leaseback

If you already own your equipment free and clear, you can use it as collateral for financing. The process involves selling the equipment to a lender for cash. Then, you lease it back from them. You need at least one larger piece of higher value equipment to qualify, and you can get funding in as little as 3 weeks.

types of small business loans Credit Suite

Credit Line Hybrid Financing:  Get up to $150,000 in financing so your business can thrive.

  1. Types of Small Business Loans: Credit Line Hybrid

One type of loan many business owners do not know about is  the credit line hybrid.   It allows you to fund your business with no collateral and typically very low interest rates.  No financials are required. Furthermore, it reports to the business credit reporting agencies. As a result, you build business credit, which will help you access more funding in the future. 

  1. Types of Small Business Loans: Traditional Business Lines of Credit

A traditional business line of credit is like a cross between a traditional loan and a business credit card. You go through a traditional bank and apply just like you would a loan.  It may be collateral based or not, depending on your lender’s requirements.  You may also use a guarantor to help reduce rates and get better terms if needed. 

The difference between a traditional loan and a traditional business line of credit is that the line of credit is revolving credit rather than a term loan. Like a credit card, you only pay back what you use. Also, lines of credit typically have lower interest rates than business credit cards. The trade off is, there are no rewards like cash back or air miles.

What is the Best Type of Loan for My Business?

Truthfully, the answer to this question varies. It depends on the specific situation your business is in at the specific time you need funding. The answer now may not be the answer later. However, here are some ideas of types of small businesses and situations that each option may work well for. 

SBA Loans

SBA government loans are an option for many business owners that find themselves stuck in the middle. For example, they may not qualify for a straight traditional loan, but still want to benefit from the lower rates and better terms these loans can offer. With a credit score slightly below what the banks typically require, many business owners can qualify for these government guaranteed loans.

401(k) Financing and Equipment Financing 

These types of small business loans are great for those business owners that have these assets to leverage.  They offer low rates and do not require credit scores as high as some other options. In fact, with the 401(k) financing, credit really isn’t an issue at all. The trick is, you just have to have a 401(k). If you do, and meet the requirements, these options can be a great way to get business funding

Merchant Cash Advance

This program is ideal for business owners who accept credit cards and need cash fast.  See, an MCA program is designed to help you get funding based strictly on your cash flow. As a result, you usually only have to provide your business bank statements. Generally, you do not have to submit a ton of documents.

You can get a merchant cash advance through Credit Suite. In fact, our merchant financing program is perfect for business owners with credit issues. Honestly, lenders are not looking for, nor do they require good credit to qualify. You can be approved for as much as $500,000 in financing with no collateral requirements and bad credit. 

Credit Line Hybrid

Maybe you do not do a lot of credit card business and still need funding. In that case, the credit line hybrid may be for you. You can usually get a loan of 5x the amount of your highest revolving credit limit account, up to $150,000. Honestly, this is more than what you could get on your own when applying for credit cards. Furthermore, you can get cash out on this program.

types of small business loans Credit Suite

Credit Line Hybrid Financing:  Get up to $150,000 in financing so your business can thrive.

Also, there is no impact on your personal credit with this type of financing. You need a 680+ credit score, but if you don’t meet that you can take on a credit partner who does. A lot of business owners use the good credit of friends or family to help them get the funding they need. 

Traditional Merchant Cash Advance

If you have strong personal credit and want the flexibility of revolving credit without the interest rates of a credit card, then this is for you. 

What are the Best Types of Small Business Loans? 

The answer to this question is not as cut and dry as it may seem.  There are a number of factors that make a difference. First, it depends on the needs of your business. Then, you have to consider what types of small business loans your business actually qualifies to get. 

The key to ensuring not only that you get the business funding you need right now, but that you are eligible for the best funding options for your business in the future, is to work with a business credit expert. They can guide you to the best funding now, and help you put yourself in a position to have even better options next time.

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Can I Use a 401K Loan To Fund a Business?

You can use a 401K loan to fund a business. But, just because you can doesn’t mean you should.  It appears to be a fabulous option.  Your payments will just be going back into your account, and any interest will be paid to yourself. In reality, it is a good idea, until you realize there is an even better way.  

Should You Take Out a 401K Loan For Business Purposes? 

When it comes to using a retirement plan to fund a business, a 401K loan isn’t the only option. Technically a distribution could work too, but that’s not wise. More about that later.  There is actually another option that many do not know about. 

Unlock the Mystery of the 401K for Working Capital Program

It’s not so much of a mystery as it is widely unknown.  This Credit Suite program offers a flexible and powerful way for a new or existing business or franchise  to leverage assets that are in a 401(k) plan or IRA. These are assets which are tied up in stocks. 

It doesn’t take long either.  In as little as 3 weeks you can actually invest a portion of these funds into your own business. Then, you not only have more control over the performance of your retirement plan assets, but you also have the working capital you need.

This type of program even has the blessing of the IRS. In fact, they  have their own name for it. It’s called a Rollover for Business Startups (ROBS). 

Will it Cause More Tax Issues Than a 401K Loan? 

No it will not.  According to the IRS, a ROBS qualified plan is a separate entity. It has its own set of requirements. The plan technically owns the business, not the individual. That means some filing exceptions for individuals might not apply to the plan. That said, always check with a tax expert when it comes to tax matters.

Find out why so many companies use our proven methods to get business loans.

Do You Qualify for a ROBS? 

Surprisingly, this type of financing is pretty easy to get. You do not have to submit financials or have good credit to get approval. In fact, all the lender will ask for is a copy of your two most recent 401(k) statements.

If the plan has a value of more than $35,000,  you can get approval. This is true even if you have really bad personal credit. You can get however much of your 401(k) is “rollable.” Sometimes, you can secure a low-interest credit line or loan for 100% of your current 401(k) value.

The plan you use cannot be from a business where you currently work. It will have to be from previous employment. Also, you can’t still be contributing to it. 

Benefits of a ROBS

The benefits of this option are many.  First, you can get 24-hour pre approval. Also, you pay no penalties for the rollover. Plus, you pay no application fees.

You can get approval even with bad credit, and the time from application to funding is 3 weeks or less. A big bonus is this type of funding will report to the business credit reporting agencies. That means you build business credit!

How Does it Work? 

It sounds kind of crazy but it works. Credit Suite business credit experts will help every step of the way.  First, we’ll help you set up a 401(k) plan in your company.  Then, you’ll invest your 401(k) funds in it. Your business then has cash, but no debt. Despite how complicated it sounds, It’s all super easy and fast on your end. We handle the hard stuff.

Also, with our program, you will get more than just the financing.  You will work with a CPA that will help you roll over a non-contributing and qualifying account. By doing this, you can cash out half, or $50,000, whichever is lower.

If applicable, they will  also structure a self-directing IRA for the rest of the fund. You will get 5 years of management and consulting services for your business.

The Question of Terms

The cost is 1% and the term is 5 years. There is a $4995  lender fee.  Remember, this includes 5 years worth of management and consulting.

Find out why so many companies use our proven methods to get business loans.

Why Can’t I Just Take a Distribution to Fund My Business with My Retirement?

Unless you are 59 ½ years old, there is an early withdrawal penalty of 10%. If you think about it, you would be paying a lot to use your own money. Don’t do that.

ROBS vs. a 401K Loan?

First of all, not all plans allow for loans.  If your plan does, the IRS will only let you borrow up to 50%, up to $50,000, before you have to start paying taxes.

Also, you would be paying interest.  That isn’t terrible, as you are paying interest to yourself. However, you will be making monthly payments, whereas with the 401K Rollover for Working Capital, there is no payment.   

This is a unique program. It allows you to tap into your existing retirement account without penalties or taxable distributions. You also avoid loans, banks, or credit checks. There is no debt and no monthly payment. 

What if You Need More Than You Can Get with This Type of Financing? 

Whether you decide on a 401K loan or you go the ROBS route, you may find you still need more.  It’s not uncommon to need other funding options to bridge the gaps between how much is available from your 401(k) and how much you actually need. 

One great option that compliments 401K financing well is the Credit Line Hybrid. You can get up to $150,000 in unsecured business financing. Similar to a 401K loan and the 401K for Working Capital program, you do not have to turn in a lot of documents.  In fact, this is considered “no-doc” financing. 

You do need to have a 680 or above credit score. However, if you do not meet this or other requirements, you can take on a credit partner that does. Many business owners piggy back off the good credit of a friend or family member until they improve their own. 

What makes this an especially good compliment to 401K financing, is that it also reports to the business credit reporting agencies. This just speeds up the rate at which you build your business credit score. 

Business Credit Score

Even though neither a 401K loan or the 401K for Working Capital Program require good credit, it’s important to understand this one thing. The 401(k) for Working Capital Program does help you build a strong business credit score.  It isn’t easy to find accounts that report your business credit report. 

Credit Suite works with business owners every day that are struggling with this.  Most account holders do not make it clear whether they do this or not.  We work with those that we know do, and this program is one of the easiest ways to get another account reporting. 

Find out why so many companies use our proven methods to get business loans.

Do not underestimate this benefit of the 401(k) financing program and the Credit Line Hybrid.  It is something that should be considered when making a financing decision.  Your business credit report can make a difference in whether you are able to get funding from another source in the future. 

Funding a Business With a 401K Loan

If your retirement fund allows for loans, and you have enough available in your account, then the answer is yes. You absolutely can. However, there is another, better option, for using your retirement account to fund your business.  Contact Credit Suite today to get started.

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Comparing Types of Small Business Loans

Businesses need funding. It’s that simple. You would be hard pressed to find a business owner that doesn’t know that. However, what many do not know, is that there are more options than just traditional bank loans. In fact, here are 6 different types of small business loans, and that is just the tip of … Continue reading Comparing Types of Small Business Loans

From Set Up to Business Start Up Loans: What You Need to Know About Starting a Business

If you are thinking about starting a business, there is a lot you need to know. Our business experts can walk you through the entire process to ensure you have the fundability you need to succeed. From how to set up your business as a fundable entity to making sure you have what lenders are … Continue reading From Set Up to Business Start Up Loans: What You Need to Know About Starting a Business