Bank Lending and Credit

Four Key Secrets to Funding Your Business

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Courtesy of Walter Good, Chief Marketing Officer of BusinessFundability.com, fromScore.org.----- Each year, over 1,000,000 new businesses incorporate, yet 9 out of 10 of these businesses will fail in the first 5 years. The leading cause of this business failure is the lack of preparation and timely access to adequate funding and credit. You can change the odds in your favor. Here are four key funding secrets that every business owner should know: Secret #1 -- If you wait until you need funding and credit, it’s usually too late. Most business owners don’t understand the need to prepare in advance for access to funding -- that is, to maximize the “fundability” of the business in the eyes of lenders. This means having several critical components in place: 1. You have created a business entity that is credible to lenders. 2. You can clearly state the assets of the business. 3. You can present company finances in a way that maximizes your creditworthiness. 4. Your business is “compliant” with lender criteria. 5. You have existing relationships with a funding advisor who understands your business model and will work with you to achieve lending goals. Secret #2 -- Credibility is the key to your business’s success. You may not know this, but every day your business is being reviewed by bankers, potential partners, prospects, and clients who are deciding if your company is “credible” enough to do business with. In today’s market, credibility is a critical differentiator between you and your competitors. If you are looking for money but don’t have financial credibility or an existing credit-asset foundation, you are probably out of luck (note that over 90% of all business loan applications are rejected). You can’t afford to be unprepared! Lenders have strict underwriting guidelines that require them to check your business’s creditworthiness -- is it a fundable business? Every business owner should understand these compliance guidelines and ensure that their business is in compliance long before actually seeking a loan. Secret #3 -- What you don’t know CAN hurt you -- and lenders often want to keep you in the dark! Would you be surprised to learn that many financial consultants, bankers, and loan brokers do not want you to know all of your options regarding building commercial credit for your business? They do NOT want you to know that the more business credit you build, the less personally liable you will be to these same financial services companies! They prefer that your business is financed with credit secured by your personal credit pledge. Don’t fall into the trap of securing your business’s credit and debt with your personal assets and savings. Rather, learn how to leverage your business to secure debt and grow a credit asset independent of your personal credit! Secret #4 -- Running a business should NOT put personal assets at risk! In view of Secret #3, as a top priority, you should build a credit line into your business that is not tied to your personal credit. We call this a Business Credit Asset™. Yes - business credit is actually an *asset* to your business, whereas personal credit debt is a liability. Most small business owners do not realize this, and therefore are putting their family’s personal assets at risk every day. Don’t make this mistake! There is a right way to structure your business that will offer security for you and your family’s assets, and will further create business assets that result in enhanced, long-term business value. Building business credit and protecting personal assets should be top priorities. Establishing this financial foundation will not only accelerate your business goals, but is also some of the best disaster insurance you can acquire! The time to start making your business FUNDABLE is today.-----Explore more at score.org
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SBA.Gov Online Courses for Financing Your Business

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 Online Courses for Financing Your BusinessKnowledge about the finances of your business is essential to its success. About These CoursesSeveral free online courses are offered by the SBA to help prospective and existing entrepreneurs understand basic finance and accounting principles. These self-paced courses are easy to use and understand. They will take about 30 minutes to complete. You can, however, exit a course at any time. Because most of the courses offer audio explanations, it is recommended that your computer speakers be turned on.Before entering a course, you will be prompted to complete an online registration form. The registration process is simple, asks only a couple of questions and will take less than a minute to complete. Available Free CoursesFinance Primer: Guide to SBA’s Loan Guaranty ProgramsHow to Prepare a Loan PackageIntroduction to Accounting   
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TransUnion

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TransUnion is a global leader in credit information and information management services. For more than 40 years, we have worked with businesses and consumers to gather, analyze and deliver the critical information needed to build strong economies throughout the world. The result is two-fold: 1) Businesses can better manage risk and customer relationships 2) Consumers can better understand and manage credit to achieve their    financial goals Get your free credit score and learn more about TransUnion's credit education resources at TransUnion.com
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What Affects Your Credit Score?

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Courtesy of TransUnion Wondering when judgments and bankruptcies will no longer appear on your credit reports? Check the dates on records in your credit report. Generally, here's how long judgments and bankruptcies remain on a credit report:BankruptcyGenerally, Chapter 7, 11 and 13 bankruptcies appear as public record items on your credit report for up to 10 years after filing. Chapter 13 bankruptcy records are sometimes taken off sooner, 7 years after filing, depending on the credit reporting company’s policy. When you receive an Order of Discharge in bankruptcy, your creditors should mark those accounts that were discharged as "Included in Bankruptcy" and they will stay on your report for up to 7 years.Charge-off accountsGenerally, if a delinquent account is charged-off, the charge-off record appears on your credit report for up to 7 years.Closed accountsGenerally, negative or derogatory information about delinquent accounts remain on your credit reports for up to 7 years. Positive closed accounts (without late payments or other delinquencies) may appear for longer than 7 years.Collection accountsGenerally, accounts sent to collections will be listed on your credit report for up to 7 years, beginning 181 days from the most recent delinquent period before the collection activity. A collection account’s status should change to "paid collection" once you've paid off the entire amount. If you settle with the collection agency for less, your credit report may list the account as "settled for less than full balance."InquiriesWhen a creditor or lender checks your credit in connection with an application, you'll usually see a "hard inquiry" on your credit report. Generally, these stay on your report for as long as two years, and may lower your credit score slightly. When a creditor reviews the credit report of an existing customer, or when you access your own data online, a "soft inquiry" typically shows up on your credit report. Soft inquiries don't lower your credit score or appear to businesses checking your credit.JudgmentsGenerally, most court judgments, including small claims, civil and child support, stay on your credit reports for up to 7 years from the date they were filed.Late paymentsGenerally, if you make a payment late, the delinquency could appear on your credit report for up to 7 years.Tax liensUnder federal law, city, county, state and federal tax liens could stay on your report indefinitely. Generally, after the lien is paid, the record of it stays on your credit reports for up to 7 years from the payment date.
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VIDEO: How Do I Get Out of Debt?

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Courtesy of TransUnion Credit Reporting Agency If you’re struggling with debt, this quick video from TransUnion has some tips to help get you on the path to lowering the amount of debt you carry, which could significantly improve your credit-worthiness, reduce the loan rates you receive and save you a lot in interest payments. Debt management or debt reduction doesn't have to be painful. It's benefits are vast and lowering the amount of debt you carry may reduce the loan rates you could receive and save you a lot in interest payments. The following video explains how it just takes a few easy steps and a little dedication to take charge of your debt.
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Equifax Credit Reporting Agency

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Equifax empowers businesses and consumers with information they can trust. With a strong heritage of innovation and leadership, we leverage our unique data, advanced analytics and proprietary technology to enrich the performance of businesses and the lives of consumers. Dispute inaccurate credit details here
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Experian Credit Reporting Agency

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Experian provides consumers and businesses with the information they need to make better financial decisions. As a top credit reporting agency, we are dedicated to helping people get their credit reports, find out their credit scores, prevent identity theft, manage their credit rating, become educated on basic consumer credit information and control the economic aspects of major life events. Experian also strives to help companies develop a credit history, manage credit risk, prevent fraud and grow their business with targeted mailing lists. Experian prides itself on being a leader in credit education. Ask Experian is the credit reporting industry’s first online consumer credit advice column. 
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Step-By-Step Mortgage Guide

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Courtesy of Freddie Mac With Your Step-by-Step Mortgage Guide, you will find just about everything you need to help homebuyers navigate the mortgage process so that they take the right steps to purchase their home. 1. Overview of the Mortgage Process  2. Understanding the People and Their Services  3. What You Should Know About Your Mortgage Loan Application  4. Understanding Your Costs Through Estimates, Disclosures, and More  5. What You Should Know About Your Closing 6. Owning and Keeping Your Home  7. Glossary of Mortgage Terms   
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Building Better Credit

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Courtesy of Freddie Mac Good credit is an increasingly important part of a consumer's financial power, but good credit is no accident.  It's the result of discipline and planning.  Start today, and your good credit will pay off with better loan terms, lower interest rates, and greater financial opportunities in the future . . . download full booklet below.
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Prosper.com: The Online Marketplace for People to People Lending

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Prosper is the world's largest peer-to-peer lendingmarketplace, with more than 1,280,000 members and over $322,000,000 in funded loans.Prosper allows people to invest in each other in a way that is financially and socially rewarding. On Prosper, borrowers list loan requests between $2,000 and $25,000 and individual lenders invest as little as $25 in each loan listing they select. In addition to credit scores, ratings, and histories, investors can consider borrowers’ personal loan descriptions, endorsements from friends, and community affiliations. Prosper handles the funding and servicing of the loan on behalf of the matched borrowers and investors.Prosper was co-founded by Chris Larsen, co-founder of E-LOAN. Prosper has raised $74.5 million in venture capital and is backed by financial and technology luminaries including, Jim Breyer of Accel Partners; Tim Draper of Draper Fisher Jurvetson; Jerome Contro of Crosslink Capital, CompuCredit; Omidyar Network; Capital One Co-founder Nigel Morris of QED Investors; Court Coursey of TomorrowVentures; Larry Cheng of Volition Capital.
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