Business Loan Strategies to Buy a Business Opportunity

When buying a business opportunity that does not include commercial property, borrowers should realize that business loan options will be significantly different when compared to a business purchase that can be acquired with a commercial property loan. This problematic situation occurs because of the normal absence of commercial real estate as collateral for the business financing when buying a business opportunity. In terms of arranging the business loan, efforts to buy a business opportunity are almost always described by commercial borrowers as excessively confusing and difficult.

The comments and suggestions in this report reflect business financing conditions that are frequently offered by substantial lenders willing to provide a business loan to buy a business opportunity throughout most of the United States. There are likely to be circumstances in which a seller will privately fund the acquisition of a business opportunity, and it is not our intent to address those business loan possibilities in this report.


Buying a Business Opportunity – Length of Business Financing to Anticipate

Business financing conditions to buy a business opportunity will frequently involve a reduced amortization period compared to commercial mortgage financing. A maximum term of ten years is typical, and the business loan is likely to require a commercial lease equal to the length of the loan.


Expected Interest Rate Costs for Buying a Business Opportunity

The likely range to buy a business opportunity is 11 to 12 percent in the present commercial loan interest rate circumstances. This is a reasonable level for business opportunity borrowing since it is not unusual for a commercial real estate loan to be in the 10-11 percent area. Because of the lack of commercial property for lender collateral in a small business opportunity transaction, the cost of a business loan to acquire a business is routinely higher than the cost of a commercial property loan.


Down Payment Expectations to Buy a Business Opportunity

A typical down payment for business financing to buy a business opportunity is 20 to 25 percent depending on the type of business and other relevant issues. Some financing from the seller will be viewed as helpful by a commercial lender, and seller financing might also decrease the business opportunity down payment requirement.


Refinancing Alternatives After Buying a Business Opportunity

A critical commercial loan term to expect when acquiring a business opportunity is that refinancing business opportunity financing will routinely be more problematic than the acquisition business loan. There are presently a few business financing programs being developed that are likely to improve future business refinancing alternatives. It is of critical importance to arrange the best terms when buying the business and not rely upon business opportunity refinancing possibilities until these new commercial financing options are finalized.


Buying a Business Opportunity – Lenders to Avoid

The selection of a commercial lender might be the most important phase of the business financing process for buying a business. An equally important task is avoiding lenders that are unable to finalize a commercial loan for buying a business.

By eliminating such problem lenders, business borrowers will also be in a better position to avoid many other business loan problems typically experienced when buying a business. The proactive approach to avoid problem lenders can have dual benefits because it will contribute to both the long-term financial condition of the business being acquired and the ultimate success of the commercial loan process.

Copyright 2005-2007 AEX Commercial Financing Group, LLC. All Rights Reserved.

Too Intimidated to Invest?

One of the biggest factors that most newcomers to the financial world have to overcome is feelings of intimidation when it comes to investments. For decades, investment portfolios and the stock market have belonged to a very small percentage of the population: the wealthy, the heavily business-oriented, or those with a degree in economics. It has long been a field in which knowledge is power, and power translates to a nice, fat bank account.

Unfortunately, this type of thinking leaves few options for those with smaller savings accounts, no working knowledge of the finance world, or an inability to trust the traditional system with their hard-earned funds. The sad truth is that many people avoid seeking the help of a financial advisor for both personal and financial reasons – none of which should be a barrier to a sound future.

Investment Myths

You have to have thousands of dollars set aside to begin investing. One of the biggest barriers to investing is that people believe in the old adage that you have to have money to make money. After all, how can you even begin to think about investing if you can’t even save enough money to get started? Although there are certain types of accounts that require a minimum investment, you can also start small. You may get a lower return to start out with, but small investments in bonds, common stocks, and IRAs are typically easy to do, don’t require huge funds, and allow you to learn as you go so that you can grow more comfortable with investing as you are able to save more money.

I won’t be able to access my money in an emergency. Another common financial fear is that your money will be tied up in investments so that you won’t be able to access the funds in the event of a medical or family crisis. While there are some types of accounts that will charge you a heavy fee for early removal of your money (like CDs), there are other types of accounts that won’t (likemoney market accounts). The trick is to determine the best types of investments for you and your lifestyle – there is no right or wrong way to do it. In many cases, it’s best to work with a financial advisor who can help you create a portfolio that is a good balance of long-term savings and shorter-term options that will give you more freedom with your money.

I might lose all my money. When investing in the stock market, there is always a chance that your savings will be lost or drastically reduced. However, this isn’t very common, and it usually happens to those who rely only on high-risk investments. When you invest moderately and under the guidance of a financial advisor who will spread your money out in several different types of accounts, you stand a very good chance of making money over the next ten, twenty, thirty, or even forty years. The trick is to view investing as a long-term plan; you might not become independently wealthy by next year, but you will have something to fall back on when you’re ready to retire.

The benefits of investing are too large to ignore, even if you don’t have a large savings account, are currently in debt, or know virtually nothing about finances.

Your best first step is to meet with a financial advisor who can help you determine what you should do first and how you can begin to get a better control of your future. The best financial advisors will look beyond the figure in your bank account and work with you to make sure you are comfortable every step of the way.

Risks Versus Returns on Coin Investments

Risk has an inverse relationship with returns. The riskier you are willing to go, the higher the returns. But, being in risky situations all the time is not safe. It may catch up to you one day or another. But how can you get the returns you want without all the risk? This is where good strategy can eliminate all your worries. If done correctly, you could achieve maximum returns without the any risks!

When you cut off all the risks, the returns are always low. Sometimes too low. So investors usually diversify their portfolios to lower their risks. This usually lowers their risks without sacrificing returns. What they usually do is put a certain percentage in extremely risk investments, then another chunk in medium risk investments, and most of it into safe investments. What they want to achieve is the highest return possible. But they always lose a lot of money in some of their riskiest investments. And then they lose some in the medium risk investments. The safe investments are usually safe. They could easily make more money if they do not lose money in their riskiest investments. But, this is inevitable because they were called risky investments for a reason. Their problem lies in the fact that their safest investments always give the lowest returns.

It’s a bit different with coin investments. In coin investments, the riskier coins usually have negative returns. So this means that you have to pick safe coins to invest in. But the same underlying problems still remain. Safe coins usually yield mediocre returns. I consider any coin that yields 6% a year or less is not a good investment. It doesn’t seem bad so why would I consider it a low return? Because it is an average of 6% over a couple of years. You would have to wait a couple of years for the coin to appreciate in value. You will get your 6% per year, but you don’t know when. I think if you have to play the waiting game, you should at least get 7.5% per year or more. That’s why I consider 6% a low return.

But if you know some good strategy, you might be able to get your high returns while cutting off all the risk. To counter the low returns and cut off all the risks you must diversify your portfolio in a certain way. All you have to do is buy high grade key dates to get your high returns. To cut off the risks you have to buy a different key date every time you buy an investment coin. So if you had 20 coins in your portfolio, you should have 20 different coins. Every single time you buy a different coin, your coin portfolio becomes more diverse. And the more diverse your portfolio is, the less risk there is. Sometimes I think that if this is done correctly, there will be almost 0% risk.