Commercial Finance

Commercial finance typical revolves around what are considered the assets of your business and are often called “asset based loans”. The assets of your business are things such as your outstanding account receivables, open purchase orders, inventory, import/export contracts, large equipment, reoccurring credit card billings and other hard assets such as bonds or certificates of deposits, etc.

Commercial financing types are loans like invoice factoring, purchase order advances, credit card receipt advances, secured working capital credit lines, inventory flooring financing, franchise financing, and import/export letters of credit.

To get approved for commercial financing it is typically much more about your assets than it is about you or your business. For example, a commercial finance lender will look much harder at the credit worthiness of your client for that invoice receivable than they will at you. For that purchase order you want to finance, a commercial finance loan will require that the company issuing the purchase order has good credit.

If a commercial finance lender is going to approve your business for a secured line of credit they will want to know that the asset’s liquidation value is enough to pay back the loan. So if they have to sell your crane or backhoe, they want to be sure they can get paid back.

A great way to get a dollar for dollar secured business loan is to secure it with a certificate of deposit or CD. With this method you can borrow money from friends or family, or even use your own savings to secure a business loan that then makes your business much more real to other lenders because they see the credit line on your business credit reports, but they don’t see that it is secured.

Visit our website at http://www.commercefinancialinc.com