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 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.
|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
ABOUT BOND FUNDING: 144 Bond Funding is a fast, low cost, non-recourse way to finance many type of real estate and non-real estate projects.
Start Up Businesses who require start up capital
Operating Businesses who require expansion capital
Bond Funding is an asset based financing option with a minimum funding request of $1 million to $500 million to no cap. The lending criteria requires limited capital requirements from the borrower domestically in all 50 states and internationally with flexible payment terms.
What is a Bond? A Bond is a debt obligation issued by state, cities, countries, governments which use the money to fund a project.
MOU – The borrower will have one week to review the MOU and plenty of opportunity to get their questions answered. After the one week MOU review the borrower will not be required to pay all of the 1% or 2 % down. A payment schedule will be provided after certain deliverables are completed during the pre-closing process.
1% or 2% Down
Transactions below $5,000,000 the borrower is required to pay 1% to 2% against total project cost. On Larger transactions the cost can be as low as .10%
Debt or Stock Option
The borrower has the option of debt, convertible debt, preferred convertible stock, preferred stock or stock offering.
The principal is responsible for all 3rd party reports ex. appraisals, BPO, due diligence and environmental reports.
The Bond Funding Process an Overview
Upon approval the borrower is required to submit
Proof of Funds
5 year Pro Forma
Bond Funding Guidelines
- A Review of your file
|General Funding Guide Line||Start Up or Operating|
|Minimum of $1 million
up to 100% LTV
no credit checks
or asset verification
no personal guarantee
all 50 states
Oil and Gas
Stabilized real estate
and many more
Up to 30 years amortized
Interest rates range from 5 to 8%
Low underwriting closing cost