This content has been marked as final. Show 12 replies
Lets speak, I may be able to help you.
Send me an email with this post and I will respond.
NRU, This is interesting. I would like to know how your clients have a 700 FICO credit and higher with LLC's and
C-Corps but cannot supply
the banks with W-2's.
I can be of help if you send details to " firstname.lastname@example.org "
Although my scenario is not exactly same, but is similar.
Here is my scenario, I have been running a small IT staffing firm, which is 7 years old, I have managed to run the business for 2 years initially but later could not continue for various reasons. Lately been reviving everything and plan to move forward aggressively.
Our staffing firm works with clients on Contracting Basis. Because the employees who work with us work on a contract basis, their salary/bills are paid after our client pays us, or we generally have enough time before we could pay them. We are looking to get some Line of Credit to meet any adverse delay in payments.
Since there has not been any revenue generated recently, I believe for me to get a loan based on the company financials is difficult, so I would prefer to use my personal credit.
Although this line of credit is requested, the idea is we donot want to use the line of credit, but have it on our account for a period of 6 months. We donot want to have access to those funds, we would just need the Line of Credit appear for us for 6 months and whenever we plan to use the funds the bank can review our financial history or qualify us and then only release any portion of that funds.
Do the banks provide a $100K to $200K Line of Credit, on persnal credit history and which bank could be ideal to work with.
It basically sounds like you are looking to finance your receivables during those times when your clients pay later than you need the money to cover your business expenses. This is commonplace.
I'd go to a local bank and see if they can help you with a revolving line of credit. Tell them that you're looking to borrow against your accounts receivable.
If your personal credit is good, you might be able to get this kind of loan by pledging the receivables as collateral and personally guaranteeing the loan. If the lender is adamant that they won't make the loan to the business but only to you, personally, then take the money personally and loan it to the business.
Eventually your business will grow to the point where the bank should get more comfortable making the loan to the business directly, but it will probably be quite some time before they are willing to release you from the personal guaranty.
If you would prefer not to borrow the money personally and you still need financing for your receivables, you might try factoring, but this sort of financing is relatively expensive.
I would not give one red cent to anyone who could not give 2 years of tax returns. Your clients want a credit handout with nothing to back it up?
Just because someone can provide tax returns doesnt mean they will pay you on time so you shouldn't cancel someone out for tax returns make them put up property. That will weed out the good and the bad and then you have something to go after if they dont pay up.
I am not addressing ability to pay..I am addressing how they manage their affairs. I do not understand nor will I ever how those who cannot and will not manage their affairs (by filinf tax returns and managing their finances) expect the 'establishment' to somehow give them preferential treatment. Which is basically what you are asking for on behalf of your clients.
I do not think it's a question of how they handle their affairs. I don't think anyone is suggesting that these people don't have tax returns (that is, that they don't prepare or file them). Rather, I think these people simply don't show enough taxable income to qualify through traditional means for the loan they seek.
There is quite a difference.
Some lenders feel that they can quantify risk and a borrower's ability to repay through means other than tax returns. For example, if someone has a high credit score, it's not altogether unreasonable to assume that that person handles their financial affairs reasonably well. Whether they can continue to do so is another topic.
Or, some lenders might be more concerned with good collateral as opposed to someone's income. If you own a $300,000 house free and clear, you'll probably have little trouble finding someone to loan you $100,000 against it (or even as much as $200,000), even if you have no documentation whatsoever. You'll probably pay a little more, but you can get financing.
By my estimation, there are two types of people who have good incomes but low taxable income.
The first type is the person who runs his own business and deducts a lot of things that most salaried people can not deduct (meals, travel, cars, maybe a huge Sec. 179 deduction). This person has a lot of income, but through deductions (some of which may be questionable...who knows?), her taxable income is not high enough to meet a lender's formula.
The second type is the person who just doesn't run all of their income through their tax return. This is illegal, of course, but I am sure there are lenders who will look the other way in order to make the loan. The lender does not know that there is cheating going on, but it's probably likely. (Like when a cash-business owner has an $800,000 house free and clear, drives a $70,000 car, keeps $100,000 in his checking account, yet magically has only a $50,000 "income" on his tax return.)
I'm sure lenders will work with the second type, too, but you have to wonder how long it is until "The Tax Man Cometh." I wouldn't want to be associated with that borrower when things fall apart.
In any event, it's all about risk and reward, and some lenders are comfortable taking a risk without what others would call plain old prudent documentation.
Many banks have "streamlined" applications for business loans under $100K; no tax returns required. Have you not noticed that?
do email me at email@example.com
Sounds like I may be able to help you. I specialize in helping people obtain loans without personal guaranty, less paperwork, getting incorporated - all aspects of getting them the capital they need with the lowest risk to their personal assets as possible.... It is really a great program - I love what I do and it really shows when working with my clientele. They are always impressed with my financial knowledge and know how when it comes to accessing the capital they need... Let me know - LLC, C-Corp are also part of my specialty line....
I have the source to help you and your clients all i ask is that you listen to the help i need God Bless and continued success.
Go to original post
Reply to original post
I need someone who has inside access to private funding or a traditional bank who can get my clients a business line of credit ranging anywhere from 50K-100K. Alot of my clients have a 700 FICO credit and higher with LLC's and C-Corps but the problem they are running into is that they are not able to supply the traditional banks with W-2's, Tax Returns, and their whole life in order to get funding. Is there anyone out there who may have inside access to provide funding for my clients?