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10 Tips To Overcome Your Fear Of Selling
Ahh. Selling. Sometimes, this is a word that is dreaded and feared by all but the most intrepid business owners. It seems that, even though we all know we need to "sell" our products and services, many of us feel fearful or anxious about...
"As Seen Online" -- Local Businesses Finally Figure Out the Internet (and Newspapers, Yellow Pages May Feel the Pinch)
A catering company in a suburban Connecticut town eliminates its Yellow Pages advertising, which once ran to $12,000 a year, in favor of promoting its website. For a growing number of small businesses, local Internet marketing is proving cheaper,...
How to Profit From Your Ad Space in this Economic Downturn
Recent research predicts that the online ad market will decline by 25% in 2003.**
In 2004, net advertising is a buyer's market.
Everyone has seen the media spotlight focused on the big dot-coms who, dependent on ad revenues, have either...
Naming Names... How to Name your Business, Product or Service
Sometimes the best inspiration comes from hearing about the deconstruction of other company's names. For you, I am happy to share how I came up with "Slice A Day :: your slice on marketing"...
First the purpose and vision of my site was to...
Small Business Statistics | Which are the riskiest and which are the safest?
Before starting a small business of your own, you should know
the risk factors. Which small businesses are the safest to start
and which ones are considered a risky business? With a few facts
in hand you can make a better business startup...
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The Basics of Borrowing Money to Start A Business
Are you thinking about starting a business but have no money to do it with? Well, you're not alone. This article will tell you the basics of borrowing money.
A loan is money that is borrowed, and has to be paid back along with interest. If the money is borrowed from an institution such as a bank, this is called a commercial loan. Money that is borrowed from a friend or a relative is called a personal loan.
The borrower, or debtor, is the business or individual that takes out the loan. The lender, or creditor, is the source from which the money was borrowed. The term, or period, is the time that is specified during which the borrower has to use the money borrowed before he has to repay the loan. The maturity of a loan is when a loan term reaches its end. The Principal is the amount that is borrowed from the lender.
When you or your business borrows money, the lender wants to know when they will get their money back. Keep this in mind when you are looking for a lending source.
If the business is not able to repay the loan, the lending source has a right to legally come after assets to recoup it's money. The extent to which you are personally liable depends on the business structure your business is operating under.
If you are approved for a loan, that you will have to make scheduled payments (typically on monthly basis) plus interest. A loan can sometimes be set up as a balloon loan. A balloon loan will typically require smaller initial payments and one lump sum of what was borrowed as the final payment at the end of the term.
Borrowing from Institutions
Business loans generally fall into two main categories: short term and long term loans. A short term loan is a loan that is to be payed back within one year. Examples of short term loans include:
Working capital loans
Accounts receivable loans
Lines of credit
Long term loans are loans that are to be payed
back typically from one to seven years. Long term loans are typically used for:
an expansion of a business
the purchase of equipment
real estate
Most business loans that are used for starting a business are long term loans.
When you approach an institution for a business loan, it will be looking at you as the business owner as closely as it will be looking at the business itself. One of the ways lending institutions make money is by lending money and they want to be as sure as possible that they get back their money with the interest owed.
The time between applying for a loan and learning that you have been approved (or disapproved) can vary. If you are disapproved, you may be told almost instantly. If you are approved, it may take a few days though it usually takes longer. It may even take several months to learn whether you or your business has being approved for the loan.
Borrowing from Family and Friends
If you don't want to, or can't get a commercial loan, you can consider getting a private loan from family or friends. This is usually real informal. However, you need to be careful because this can lead to ruined relationships.
If you are getting a private loan, it is in the best interest of the lender to have an agreement put in writing. The written agreement should state the principal, the interest charged and the terms of repayment. This puts the lender in better position either write off the loan on his or her tax return or to legally come after you.
You are free to reprint this only if the article text link is included:
about the author
Jose Valdez is the owner/webmaster of A Guide To Starting A Business.com
Find Business Articles.com and
All Home Based Business Ideas.com
Jose Valdez is the owner/webmaster of A Guide To Starting A Business.com
Find Business Articles.com and
All Home Based Business Ideas.com
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