Loans
Some
New, Some Unusual. Some Same Old
SBA Loans
The
SBA provides various programs for the most part they guarantee the loan which is made
by the
lender.
The
main loans they offer
are the 7(a) which is probably the most popular. Also the 504 and
disaster
assistance loans are available.
We
will focus our
attention on two little heard of SBA loan programs. The Micro-loan 7(m)
and the
newest loan SBA has to offer called the Patriot
Express.
Patriot
Express:
This loan is for Veterans, Disabled Veterans, National Guard and
Reservists, current spouse and widowed spouses.
It
is offered through a
nationwide network of participating lenders, it offers fast turn around
times
with regard to loan approvals. These loans can be used for almost any
business
purpose (including start-up).
Patriot
Express loans
are
available up to $500,000 and the SBA will guarantee from 75 to 85%
depending on
the size of the loan. Loans over $350k require all collateral be taken
as
security. Interest rates run 2.25% to 4.75% over prime.
Micro-loan 7(m): These loans can solve working
capital problems or be used to purchase
inventory. The loan itself can be for as much as $35,000 but is not
available
in all states.
Typical applicant : Is a
small business or non-profit daycare
Personal Unsecured Loans
Prosper.com: Is a pool
of individuals like you and me; who invest various amount of money into
your
loan request. Interest rates depend on your credit but even people with
bad
credit do get loans here.
The loans
are:
- Unsecured loans
- Fixed interest rate that never
changes for the length of the loan
- Loans are for 36 months
- No pre-payment penalties
Prosper is a
highly reputable company which has been featured on many of the major
news and
financial magazines. They have funded $139 million in loans and have
over
700,000 members.
Home
Equity Loans
Home
equity Loans: In my
opinion this is the worst thing you can do. Why? Because this is putting
your home at risk; If your home-based business or franchise fails you
not only
lose your business, you lose your home. This puts you and your family
with no
place to live and for me that is too much to risk.
Personally I
would much rather try any of the other methods before this but that’s
just my
opinion. I put it out there because it is an option and many people do
use it
but Beware
it comes with a heavy price tag if it doesn’t work.
Please
Note: I am talking
strictly about your personal residence. If you have investment property
then
that’s a different story and I would certainly consider a loan against
an
investment property as a viable means of raising capital for your
home-based
business or franchise.
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