Check out this great article on financing a business from BusinessNewsDaily...

Today there was a great article on BusinessNewsDaily.com, "7 Ways to Finance a Small Business" By David Mielach, Staff Writer.

What makes this article great is not only its inciteful synopsis of the 7 ways to finance, but also the breakdown of each one including advantages and disadvantages. According to Mr. Mielach, the 7 ways to finance are...

• Small Business Administration Loan


• Friends and Family


• Home Equity Loan


• Credit Cards


• Angel Investors


• Venture Capitalists


• Strategic Investors

The only one he may have missed, is of course financing the purchase of an existing business through use of retirement funds. Other than that, this is a great read for both buyers and sellers alike to educate themselves. It is definitely worth a read.

Click here to read the full article.

Seller Financing -- How a Broker Can Help

Another important factor relating to the asking price is the amount of cash involved in the sale. There is an old saying that the higher the full-price, the lower the down payment - and vice-versa. The sale of almost any business involves some seller financing. The smaller the down payment, the higher likelihood of a quick sale. No seller wants to take back his or her business because the buyer wasn't successful. On the other hand, a buyer wants to make sure that the business will not only pay for itself, but also provides sufficient income for his or her family's needs.

What it all boils down to is that the seller wants the buyer to be successful and the buyer wants to buy a successful business. With the amount of capital required in today's market to buy a business, sellers should feel optimistic that they are dealing with successful buyers.

Read on to find out more about four important ways a Broker can help in this process...

• A Valuable Service
• Maintaining Confidentiality
• The Future of the Business
• What Buyers Think

to read the full article... click here.

Check Out... Small-business lending rises 30 percent in Indiana

By Franscesca Jarosz
IBJNews (IBJ.com)
Nov. 13, 2010

The amount of money banks loaned through U.S. Small Business Administration programs shot up close to 30 percent in Indiana this year - a sign that the state's small businesses have slowly started coming back to life.

Small companies are taking out more SBA loans not just to fund operating costs, but also for capital projects such as expansions. Entrepreneurs also are investing in startups, which accounted for about a quarter of the SBA loans issued in the fiscal year 2010 that ended Sept. 30.

To read more... click here.

Check out... SBA Program Proves a Hit, but Now It Is in Limbo - WSJ.com

By Ruth Simon
August 5, 2010
WSJ.com


Pinnacle Bank made just two loans through the Small Business Administration in 2007 and 2008. So far this year, the Orange City, Fla., bank's total is nine, to borrowers from an auto dealer to a computer-equipment wholesaler to a bakery.

"The SBA program ios the only way we can continue to lend right now," says David Bridgeman, president of Pinnacle, which has two branches and assets of $213 million, including about 600 loans. For many of the $3.4 million in loans Pinnacle made through the SBA in 2010, the bank has to set aside capital against only the 10% slice that isn't guaranteed by the U.S. government.

The 7(a) program, the SBA's largest loan program, is hardly a cure for the credit shortage affecting the many borrowers. The agency is involved in less than 10% of all small business loans, and some banks won't participate because of red tape. Lenders must follow the SBA's rules when making 7(a) loans, which can be used for working capital, fixed assets and other business expenses. The term of the loan can be as long as 25 years.

Last year, Congress temporarily sweetened the 7(a) program by increasing the SBA guarantee to 90% of any given loan from as little as 75% previously. Lawmakers waived fees costing borrowers as much as 3.5% of the loan amount, as well as costs charged in a separate SBA program providing structured financing for fixed assets.

But the sweetened program is now in limbo, drawing from borrowers and lenders, as lawmakers haggle over broader small-business legislation...

to read the full article... click here.

check out... "Getting an SBA Loan: 5 Things You Need to Know"

Getting an SBA Loan: 5 Things You Need to Know

Getting a business loan is tough -- especially these days. But the Small Business Administration can still be a great lending partner. How to cut through the red tape and secure an SBA loan.

Chasing a Small Business Administration loan these days is a little like going to a carnival and expecting to win one of those giant stuffed animals. It might happen, but the odds are probably against you. As Christine Reilly, the president of small business lending for CIT, points out, about a year ago, the federal government tinkered with the formula for getting an SBA loan, and for a brief shining time, even during the Great Recession, SBA loans were semi-easy to come by.

Of course, it's still possible to get an SBA loan -- Reilly is the first to admit it -- and it can be a great way to infuse your company with cash. But how can you navigate the red tape and make sure all the effort pays off? Here are five things you need to know.

• Know the lingo.
• Document everything.
• Got collateral?
• Do your homework. Seriously.
• You are not a risk taker

to read the full article … click here.

The SBA Has a Deal for You

It's called a 504 loan. Here's what you need to know about it.
By Marshall Eckblad
WSJ.com: Small Business
June 21, 2010

The government is trying to entice more small businesses to tap one of its loan programs. Before applying for one of these loans, though, there are some fine points borrowers should consider.

The Small Business Administration's 504 loan program lets companies take out fixed-rate financing to buy property, build or expand facilities, or refinance some existing mortgages. The borrower typically needs to put down just 10% of the transaction's total price.

With the weak economy deterring many small businesses from expanding in the past couple of years, demand for these loans plummeted: Last year, the SBA approved $3.8 billion in 504 loans, down 28% from 2008 and 40% from 2007. Hoping to spur expansion among small companies, the SBA is offering inducements like lower rates and no-fee deals.

To read the full article... click here.

Purchase a Business With Your 401K!

By: David Gorman (bio)
Senior Business Broker, Sunbelt Indiana

Why? Because there are NO penalties, that’s right. This 401k Rollover program lets you use your 401k and other retirement funds to invest in a business – TAX AND PENALTY FREE. This is a safe, proven plan based on long standing provisions of the Internal Revenue Service (IRC § 6501). By using pre-tax retirement dollars to fund your business, you gain equity in your business and improve cash flow from day one. Use the funds to receive a salary during startup, while accelerating profitability by eliminating or reducing interest or debt. Application, creation, and funding is fast; typically (2-3 weeks or less). You can even set aside tax deductible retirement savings up to $200,000/yr.

The benefits of using your 401k:
-Minimize debt
-Enhance cash flow
-Stimulate business growth
-Build equity
-Take full advantage of tax benefits