“The steps you take don’t need to be big they just need to take you in the right direction”
Financial Leverage is the use of borrowed money to increase production volume, and thus sales and earnings. It is measured as the total debt to total assets. The greater the amount of debt, the greater the financial leverage.
Since interest is a fixed cost (which can be written off against revenue) a loan allows a business entity to generate more earnings without a corresponding increase in equity
In the world of commercial finance there are only two types of funds available, debt or equity.
Equity financing involves investors who invest money into a company and in return receives some percentage ownership of the company. The exact amount of ownership would typically be a function of how much they are investing versus how much the company is worth at the time of investment.
Debt financing, on the other hand, involves a lender who loans money to a company and receives a predetermined interest rate paid by the borrower as well as having the principal (the original amount of the loan) paid back over time.
A direct lender can only offer a very specific financing that may or may not be the best available for the borrowers funding request By best available we mean the most capital at the lowest interest rate with the least onerous collateral requirements. Keep in mind that because we are not a direct lender but rather a clearinghouse for hundreds of different lenders and funding sources we offer a great advantage to the commercial borrower.
Client Profiles we can work with
Principals or Companies who require Non-Traditional Financing
Any company or individual that is unable to secure commercial financing through traditional sources, particularly if funding needs are immediate. Some examples are, developmental stage companies, companies with historical and/or current losses, companies with negative net worth or tax liens, companies in Chapter 11, healthy companies that need a more aggressive lender who will provide a larger credit facility and companies where the principals have poor credit.
Individuals who have poor credit or limited capital to make an acquisition of a commercial property or operating business or project development may also find help through private funding.
Bank Turn Down
When the bank turns down a commercial loan applicant based on poor credit or too short a time in business we may also be able to arrange for funding until such time as the business becomes bankable.
We can arrange for 100% financing on large construction projects both domestically and internationally where the borrower has to meet certain specific liquidity requirements to be approved.
Additionally, we represent hundreds of equity and venture sources who may provide straight equity if required in order to enable a deal to be completed.
Revolving credit lines
General out line of Transactions we work on
Letter of Credit Financing
We can lend up to 97% against a Letter of Credit (LC) or Stand BY Letter of Credit (SBLC) provided the banking institution has a AA rating and meets our lending source requirements.
One of the lenders that we represent will lend against an irrevocable, unconditional, assignable, divisible, transferable cash backed Letter of Credit (LC) or standby letter of credit (SBLC) issued by any bank that is AA rated (might consider AA- or A+ rating) provided that the bank has a New York city branch or correspondent bank here in New York, where the LC would be held. The rate for only this specific program is 6.75% and they will lend approximately 97% against its net present value.
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|A national lender funds domestic and international loans has closed over $100 Billion in transactions with a specialty in real estate finance and development, brokerage and investment management. They will structure financing in a conventional, alternative, Bond, private placement and non bankable arrangements. The lending guidelines are very similar to the guidelines of Bond Funding.|
- Minimum of $1 million
- Interest rate of 8.5%
- Term 10 years
- All 50 states
- International Financing
- Moratorium 2 to 3 years on construction
Cash is King
“Cash Is King. An army may march on its stomach, but for companies, it’s liquidity that keeps the business going. For many companies, typical sources of liquidity, beyond cash flow from sales or other revenue, are
- Financing from banks or other secured lenders,
- from vendors that can reduce immediate liquidity needs, an
- when needed, loans from owners, investors, or other insiders.
When A Liquidity Crisis Hits. Companies in financial distress often find that their need for liquidity goes up just as the availability of traditional financing goes down.
- the borrowing base may shrink,
- the ability to get further advances may be cut off,
- and loans may go into default.
Worse, new lenders may be unwilling to make loans given the distress. For many distressed businesses, revenues may also be declining and insufficient to cover expenses without additional financing. A liquidity crunch can quickly snowball into a liquidity crisis.
Insider Loans would be an option from investors, or Lenders that would be open to making a loan.”
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