Small Business Loan Solutions

Statistics show that 94.7% of all small business owners feel their only financial resources are their local banks or personal credit cards… even though their local banks often require them to pledge their personal homes & land as collateral.

Here are some tips that can save your business, regardless of your personal credit history.

First of all, getting approved for a small business loan is definitely easier than getting personal loans… regardless of your personal credit scores. Additionally, getting the right types of corporate credit is absolutely critical: if you want to protect your personal assets, minimize the risk of a personal lawsuit affecting your business, and to your ability to weather the economic changes that happen overnight.

All business owners must be much more proactive about developing relationships with the right types of lending institutions. You usually want to start your application process with out-of-state, national lenders… not your local or regional banking institutions. National lenders typically won’t require a personal guarantee or your social security number.

I’ve attached a basic roadmap you’ll need to follow, if you need a small business startup loan, a business debt consolidation loan, a bad credit business loan, or a government business loan.

Ultimately, you need to find a competent professional that can help you navigate through the process of building a strong corporate credit rating.

Finding a competent business loan expert will give you a head start on your competition & also let you focus on running your day-to-day activities… instead of dealing with the hassles of establishing a strong business credit rating. An excellent business credit score can help your company’s image, overnight.

You need to prepare yourself with these very basic questions, before you apply for any business credit.

1. How is your business structured? Is it a sole proprietorship, C-corporation, S-Corporation, Limited-Liability Corporation (LLC), Partnership, or Trust?

2. How long has your business been recognized by your State & Local government?

3. Has your company ever had derogatory information reported against it to either of the two (2) most popular business credit reporting agencies, Dun & Bradstreet or Experian?

4. Are your company permits, licenses and registrations current?

5. Does your business have a physical address, or are you trying to use a U.S. Post Office Box instead?

6. Is your business telephone number recognized by directory assistance?

7. Are your incoming telephone calls professionally answered in your business name?

8. Have you established a business checking account?

9. Have you registered & asked for an Employer Identification Number (also known as an EIN) from the IRS?

If your answer to the first question was a sole proprietorship, partnership or trust; I urge you to re-establish your company as a corporation or LLC. I’m not going to provide you with legal advice, but many CPAs and attorneys highly recommend LLCs (Limited Liability Corporations) as a way of protecting your personal assets & estate… in the event of any lawsuits being filed against your company.

As a sole proprietor, your personal assets are at direct risk of seizure or forfeiture when faced with most types of legal action. Additionally, if you are applying for business loans in a corporation’s name… most lending institutions will not require you to provide any personal guarantee!

A corporation can still face difficulties applying for business credit, if it has been in business less than 2 years or had previous credit problems reported against it. Here are some ways to fix these problems.

- Purchasing a “shelf corporation” or “aged corporation” that’s been in good standing with your State government (for longer than 2 years) can drastically improve your chances for small business loan approval.

- You can attempt to repair your business credit rating by writing dispute letters to Experian or Dun & Bradstreet, which isn’t always possible.

- Some corporate credit experts will help you find, select & purchase an established “shelf” or “aged” corporation, some of which already have strong credit ratings established… saving you a lot of hassles!

I cannot stress this enough… you MUST have a physical address (not a PO Box) if you want to establish a solid business credit rating. The same thing is said for telephone numbers & the way incoming phone calls are handled. Would you lend money to a company that does not appear to have a physical address or documented telephone number?

And, don’t forget to always keep your small business permits, licenses & registrations current… and always keep copies of these documents in case a potential lender asks for this information.

Business checking accounts are a must. Again, this proves stability to your potential lenders. Here are a couple of tips for you, in case you’ve had any checking accounts closed by a financial institution. Pay off the outstanding balance (if any) that’s being reported by the bank, or open a checking account at a bank or credit union that doesn’t use the ChexSystems credit reporting system. Most credit unions don’t use ChexSystems, and you can always find a list of banking institutions in your area that don’t use ChexSystems… by simply doing a search on Google, Yahoo or MSN.

Small business credit ratings are tracked using your business name, business address and employer identification number (EIN). You can apply for & receive an EIN at the IRS’s website (irs.gov). You can also call the IRS, but be prepared for long waits.

Then you’ll want to obtain a D-U-N-S number from Dun & Bradstreet, the largest business credit reporting agency. You can apply for this without any fees at Dun & Bradstreet’s website, and you’ll usually receive this number within thirty (30) days. Do not apply for this number until you’ve prepared your self thoroughly, because any information you give to them… goes into your credit file… permanently.

After you’ve obtained your D-U-N-S number, you’re probably ready to start establishing some vendor credit. Vendor credit is where many business owners start establishing business credit ratings. Simply go to staples.com, officemax.com or officedepot.com to get started. Then, you’ll also need to fax your business telephone bill & the credit application to them… on your business letterhead (which you can create using your favorite word processing software if you don’t have expensive stationery). They usually don’t require any personal guarantees (if you’ve followed the outline above), and you’ll usually receive a starting credit line of $750.

This is critical & I repeat… critical! Always pay your invoices before the grace periods begin… especially on unsecured credit cards or vendor credit lines. Dun & Bradstreet will lower your credit score for every day a creditor reports your bill as unpaid while you’re within your grace period. Whereas, personal credit scores are not lowered unless you are 30+ days past your due date.

Dun & Bradstreet reports what’s known as a Paydex score (your corporate credit score), and a score of 80 is very good… with 100 being the highest score you can achieve. Your Paydex score is issued once you’ve established a known vendor/credit relationship with at least five (5) creditors.

There are shortcuts that will help you get much more than $750 a lot faster. When using a business credit expert, most small business owners (even startups) can be approved for vendor credit lines of $25,000-$50,000 and open credit lines of $50,000, $250,000, $500,000 or more… in as little as 45-60 days… by using their knowledge of the application process & “shelf” corporations.

Now, it’s your choice. Are you going to go against the grain & try to establish business credit on your own (which could prove costly to your business health, growth & survival)? Or, will you choose to utilize a corporate credit expert… allowing you to remain focused on your daily business needs?

Most business owners make the mistake of trying to do this on their own… usually trying to find grants, investor “angel” money, or falling back onto the “personal credit card sword”. Don’t be a casualty like the rest. Learn more about how you can use the tools that informed, educated millionaire businessmen have used for years.

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What Are The Focus Areas in Small Business IT For 2008?

2008 will be here before you know it, are you ready with what the market will throw at you in a couple of months. With 2008 just around the corner, now is a good time to start the discussion of what needs to be the focus areas in 2008 for the small business IT professional and small business specialist.

In 2007 we experienced a tremendous amount of innovation in the small business technology world. Innovation included releases of a new desktop operating system, new productivity suites of applications and enhanced methods to share information and communicate with each other. 2008 will be no different! The excitement around new versions of the Windows Server operating system that will scale from the smallest of business requirements right through to the largest of enterprises offerings. Plus we will see new innovation with how business manage, share and secure corporate data and how applications are written that deliver solutions to today’s global economy.

However, I personally do not feel that our focus be totally on the ones and zeros around all of this new technology. Small business owners, managers and users today do not care about what the technology specifications are, they have business needs that must be addressed and they need to be running all the time. Downtime, breakdowns and complicated solutions are not an option in today’s one world market.

Where will today’s IT professional or small business specialist be focusing their efforts for the upcoming year in order to grow their business sustainably in 2008? Here are some ideas to kick start the planning processes for 2008:

Focus on people – Small Business does business with those who they trust and can establish a relationship with. It is not about the speeds and feeds any longer, small business owners don’t care about how fast something runs or how much memory is in a laptop. Meeting business needs is no longer expectable by throwing technology at a problem, it is now about exceed expectations and having their technology investments work. The systems or software most of the time is transparent to the end user.

The importance of data – Having their data accessible and secured is very important to small business. Data has to be managed and controlled and combined with ease of access. Complicated file shares and network systems are no longer acceptable to the end users. Data must be accessible to enhance collaboration and sharing throughout any organization. Small Business IT firms that understand and promote the importance of data, who can offer their clients services like the SharePoint Starter Site and Exchange mail services through their mail clients, mobile telephones and web access will win in the end.

Securing Small Business – As the world shrinks in size when it comes to business, emerging threats continue to show their ugly face and threaten commerce. Securing small business will continue a challenge for the small business specialist. It must be a main focus for many of us in the IT community. Luckily, we haven’t seen a major virus outbreak for a while; however, the threats are still out there. Educating small business against the threats from social engineering, corporate espionage and also the “threat from within” must be a major focal point in 2008. As social networking gains momentum, small business needs to understand the importance of ensuring information flow is secure without jeopardizing productivity. Small Business IT Professionals that offer their clients a managed firewall service that controls SPAM, virus, spyware and other threats will have a competitive advantage of those who offer transactional firewalling solutions.

Business Process – How small business does business will be an important trend for the small business IT professional to understand in 2008. If a small business consulting firm can master how small business does business and how information flows within their clients will end up ahead in 2008. Business Intelligence services that once purely an enterprise play will start to move into the small business space. Those who master this will come out of 2008 with a definite advantage.

IT as a Service – Managed Services is all the buzz in the SMB community it has been for a number of years, however, in 2008 the focus on “as a service” will grow, firms that can offer software or hardware as a service will have a competitive advantage over those who do not, and those that can bundle their complete IT solutions as a service will win in the end. It will no longer matter how it is structured from a billing perspective, (annual, monthly, weekly or hourly) the service component is the important key and this is what small business is after.

The Complete Solution – SMB consultants that can deliver the complete solution will win in 2008. This is nothing new, small business wants a solutions partner that can offer the complete end to end offering. From systems, software, solutions and service, today’s small business client needs to be “under” one umbrella. Partnering will continue to be an advantage in the marketplace. Partnering to extend geographic service, specialty services and complete services must be on the top of your list to achieve in the early part of 2008. Those firms that can extend their service offering to other partners will have a strong advantage over those who just stick to their own small silo.

Marketing - The small business consulting firm that can market all of this effectively will hold the trump card over those that do not see the importance of marketing. There has been a lack of focus on the importance of marketing with small business partners over the past few years, while those that continued to actively market have grown faster and have separated themselves from the masses. Small Business partners must have a resource dedicated to marketing in 2008. This can be outsourced or hired in-house. One word of advice to the owners of small business firms, you are responsible for the strategic marketing direction, never outsource that component. If you are not comfortable with marketing, seek the advice of someone who can help you. There are a number of great marketing coaches and consultants that can assist you.

Strength in Peers – Teaming up with peers will continue its strong momentum in 2008. Once again, no IT firm can know everything nor do everything. This is where having a strong peer group relationship is vital to the success of your business. Information and idea sharing, technical specialties, and relationships are keys to success in the IT business. TechSelect and Heartland Technology Groups offer peer group services to firms that specialize in small business and are open to sharing information, best practices and resources with each other. Our involvement in the Heartland Peer Groups has been a key to the success of my business and offers us a competitive advantage over firms that have not engaged in this business practice.

“I think the marketing continues to present great opportunities for partners who execute, deliver great service, and provide true solutions to clients…and that’s where we’re focusing for 2008,” states Erik Thorsell, President of Minneapolis’ Success Computer Consulting. “Managed services support for network infrastructure is important, but that doesn’t get our business owner-clients excited…solutions do! If we can provide technology that solves business problems, makes work better, faster or cheaper, then we all win!”

2008 will be an exciting year in the small business space across the globe, boundaries will continue to disappear in our global economy, peer relations will strengthen, and collaboration will continue to become more and more important to small business, however, it needs to happen in a secure fashion so that small business can maintain a competitive advantage in the marketplace that they service.