Financial Dose for Business

The goals of businesses have undergone much evolution from the times when entrepreneurs were content with anything that they received above the capital invested. Businesses now want to expand their reach globally, riding on the wave of technology.

Nevertheless, technology does not come cheap. A huge amount of capital is required to buy the latest in technology. Businesses generally have two options. The first will be to purchase the latest technology. This however suffers from the disadvantage that it creates a fixed charge on the balance sheet. If the case is of a new start up, this can mar its performance from the very beginning.

The next option is a secured business loan. A secured business loan is a loan where the businessperson can have funds to finance any project. It is more beneficial than the former because it does not eat into the resources base. Moreover, the loan is taken for a larger period. Thus, the businessperson can continue his operations without thinking of the repayment.

Secured business loans are advanced against collateral. Larger loans require larger collateral. Lenders get the rights to plants or machinery or any tangible asset of value. This will act as guarantee for the loan. The collateral is safe and the borrower can get the rights back after the loan has been paid in full. However, the opposite is also true. The loan company will seize the asset on which the loan had been secured to retrieve the payment.

It is generally difficult to get secured business loans. Most online lenders offering personal loans may not be offering good deals on business loans. The first step should obviously be to contact the bank through which the regular business dealings take place. Since they know the business and its credit well, they offer the loans in a lesser time.

Capital is a very important part of the business. Many businesses have failed because of inadequate funds. Businesses have to make hasty decisions. Even small delays can result in losses of millions pounds. Making a survey of the time loan companies take to approve the loan application will be beneficial in deciding when to start the loan process.

Loans are available for all kinds of businesses, whether small, medium, or large. The repayment period may differ according to the loan taken. Long-term loans are available for a period of about 25 years. Short-term loans are repayable within a year.

If you are a small organization, it will be better to look for a lending organization that caters to your kind of business. Bigger lenders too, may be contacted, but may not service small business with the same zeal as they would to a bigger enterprise.

The secured business loan makes the business liable for its repayment. The principal amount of loan grows with interest. This makes a serious planning for the loan very necessary. The first thing to do would be to question the actual need for the loan. There are certain needs that can be postponed or make the need redundant. This would save the organization the extra liability of the secured business loan.

Deciding well in advance the use to which the capital will be put to, will be the next priority. Businesses must resort to loans finance only for projects that aim to bolster the vision of the business. Taking loans for frivolous reasons will affect its performance. Taking too many loans will also affect the debt to equity ratio. This means that the extent of loans and other sources of finance is greater in the capital.

Apart from the traditional monthly payment type, borrowers can repay the secured business loan through a variety of methods. Borrowers can pay equal monthly installments and pay the remaining amount through a final balloon payment. Interest only payment will require a monthly payment of interest and a final balloon payment to pay off the remaining amount. There are many more features available on the secured business loan to help businesses grow.

Andrew baker has done his masters in finance from CPIT. He is engaged in providing free, professional, and independent advice to the residents of the UK.He works for the personal loan web site http://www.ukfinanceworld.co.uk for any type of uk secured loans and unsecured loan please visit http://www.ukfinanceworld.co.uk

In The News:

20 Email Marketing Services and Tools  Small Business Trends
Where Is Amazon Going Now in 2021?  Small Business Trends
Keeping small business in business  Santa Clarita Valley Signal

Public Relations: Antidote for Small Business Failure

When small businesses fail, the wreckage is often assigned to... Read More

How to Find a Microenterprise Loan for Your Business

If you're looking for start-up capital for your business, but... Read More

Postcards Make It Rain Referrals

One of the simplest ways to expand your marketing efforts... Read More

Keep TRACK of your Business Relationships and Gain Profits

How do you know when an alliance needs to be... Read More

11 MONSTROUS Small Business Marketing Mistakes and How To Avoid Them

Increase your profit potential by identifying ? and avoiding ?... Read More

Drivng Home the Point - An Outsourcing Story in China

A few years ago, I visited Beijing for the first... Read More

Hosted PBX, Is It Right For You?

"Order Now!" "Your Business Will Fail If You Don't Have... Read More

Dont Let Your Small Business Fall in the FDCPA Trap

When someone owes your small business money, you certainly feel... Read More

Keeping Business Alive

Who is responsible for maintaining the business relationship?Nurturing a business... Read More

Competition in the Mobile Car Wash Industry

We have all seen the mobile washing units cruising our... Read More

Using Business Broker In the Franchising Industry for Franchise Sales

Franchising companies often use Business Broker to help attain sales... Read More

Top 10 Lessons for Small Business Success - As learned From My Twin 3 Year Olds

Small business success is very similar to learning to walk,... Read More

Employee Relations Manual Sample Outline

Most smart entrepreneurs and all large corporations have Employee Relations... Read More

Due Dilegence 101 Or What You Do Not Know Can Kill You! - Part 1

Introduction: This article is written as a general discussion on... Read More

Why is My Restaurant Not Full Every Monday Night?

In a quest for customers and to keep those customers,... Read More

Marketing a New or Small Business on a Budget

There are almost as many opinions and views on marketing... Read More

Window Cleaning Business Future Challenge With Self Cleaning Glass

Self-cleaning glass has been talked about a lot, with such... Read More

Practical Money-Saving Tips For Small Businesses

One of the primary concerns all small businesses have is... Read More

How to Manage Your Pipeline

How is your pipeline structured?I assume most of you have... Read More

Franchising Pros and Cons

Last week's question from Anthony R. on how to choose... Read More

Its Spring - Time For A Compensation Program Tune Up

Now that winter has passed, the annual ritual of spring... Read More

How to let go of your EGO

When does your ego get in the way?Let's go back... Read More

Franchise Territories for Mobile Businesses; Why Limitations

In franchising an individual desirous of their own business will... Read More

Window Cleaning Business Case Study

How do window cleaning franchise businesses start? It is a... Read More

Start a Technical Writing Service

Technical writing services are employed to explain the details of... Read More