An unsecured business loan is a loan that is granted by a lending institution that requires no collateral from the borrower. Most unsecured business loans fall below the range of $50,000. With an unsecured loan, a business owner receives the loan after they have convinced the lending institution that their business is a wise investment; one that shows considerable promise in the future. The borrower agrees to pay back the principle of the loan and any interest accrued overtime. Unsecured business loans are often used by business owners to make improvements to the business or to pay off business related debts.
Usually, a business owner will apply for an unsecured business loan before the business is established, or after the business has been functioning for a while. Loan money is often used to purchase new equipment, or for the purposes of business expansion. Secured and unsecured business loans are excellent financial resources, especially when a business owner is in a financial bind and in need of new equipment or funds to expand a business. Unsecured business loans are a way to keep a business thriving and the business owner can use the money from unsecured business loans can be used to improve how the business functions overall.
There are several differences between the secured business loan and the unsecured business loan. Each of the differences associated with secured and unsecured business loans must be considered before the borrower applies for a loan. While some of the differences between the two types of loans are minor, there are some major differences between secured and unsecured loans that should be examined: such differences can reflect on the total amount that must be repaid by the borrower. Consequently, a business owner should consider both an unsecured loan and a secured loan, view all of the advantages and disadvantages associated with each loan and weigh their options before making a final decision on which loan to apply for.
Tuesday, November 27, 2007
Wednesday, November 21, 2007
Happy Thanksgiving!
ABRAHAM LINCOLN'S THANKSGIVING PROCLAMATION - 1863
"It is the duty of nations as well as of men to owe their
dependence upon the overruling power of God; to confess their
sins and transgressions in humble sorrow, yet with assured
hope that genuine repentance will lead to mercy and pardon;
and to recognize the sublime truth, announced in the Holy
Scriptures and proven by all history, that those nations are
blessed whose God is the Lord.
We know that by His divine law, nations, like
individuals, are subject to punishments and chastisements in
this world. May we not justly fear that the awful calamity of
civil war which now desolates the land may be a punishment
inflicted upon us for our presumptuous sins; to the needful
end of our national reformation as a whole people?
We have been the recipients of the choicest bounties of
heaven; we have been preserved these many years in peace and
prosperity; we have grown in numbers, wealth and power as no
other nation has ever grown. But we have forgotten God. We
have forgotten the gracious hand which preserved us in peace
and multiplied and enriched and strengthened us, and we have
vainly imagined, in the deceitfulness of our hearts, that all
these blessings were produced by some superior wisdom and
virtue of our own. Intoxicated with unbroken success we have
become too self-sufficient to feel the necessity of redeeming
and preserving grace, too proud to pray to the God that made
us.
It has seemed to me fit and proper that God should be
solemnly, reverently, and gratefully acknowledged, as with one
heart and one voice, by the whole American people. I do
therefore invite my fellow citizens in every part of the
United States, and also those who are at sea and those who are
sojourning in foreign lands, to set apart and observe the last
Thursday of November as a day of Thanksgiving and praise to
our beneficent Father who dwelleth in the heavens."
"It is the duty of nations as well as of men to owe their
dependence upon the overruling power of God; to confess their
sins and transgressions in humble sorrow, yet with assured
hope that genuine repentance will lead to mercy and pardon;
and to recognize the sublime truth, announced in the Holy
Scriptures and proven by all history, that those nations are
blessed whose God is the Lord.
We know that by His divine law, nations, like
individuals, are subject to punishments and chastisements in
this world. May we not justly fear that the awful calamity of
civil war which now desolates the land may be a punishment
inflicted upon us for our presumptuous sins; to the needful
end of our national reformation as a whole people?
We have been the recipients of the choicest bounties of
heaven; we have been preserved these many years in peace and
prosperity; we have grown in numbers, wealth and power as no
other nation has ever grown. But we have forgotten God. We
have forgotten the gracious hand which preserved us in peace
and multiplied and enriched and strengthened us, and we have
vainly imagined, in the deceitfulness of our hearts, that all
these blessings were produced by some superior wisdom and
virtue of our own. Intoxicated with unbroken success we have
become too self-sufficient to feel the necessity of redeeming
and preserving grace, too proud to pray to the God that made
us.
It has seemed to me fit and proper that God should be
solemnly, reverently, and gratefully acknowledged, as with one
heart and one voice, by the whole American people. I do
therefore invite my fellow citizens in every part of the
United States, and also those who are at sea and those who are
sojourning in foreign lands, to set apart and observe the last
Thursday of November as a day of Thanksgiving and praise to
our beneficent Father who dwelleth in the heavens."
Friday, November 16, 2007
Get A Squeaky Clean Credit Score
You are your own best resource when it comes to maintaining a good credit score. Here are 10 tips to help make your credit report shine:
Pay bills on time. Nothing ranks higher than consistent and timely payments.
Have credit cards - but manage them responsibly. Credit cards and installment loans that you pay on time will raise your score. Someone who has no credit cards tends to have a lower score than someone who has managed credit cards responsibly.
Maintain low credit card balances. Some experts advise not to use more than 50% of your limit on any one card.
Rotate and use all of your credit cards. Contrary to popular belief, a dormant account does not help your credit score.
Never use credit cards to pay other credit cards. It's better to pay down those you have. You can start with the ones with the highest interest rates or balances.
Don't open multiple accounts at the same time. Too many credit report inquiries lower your score and increase your credit risk.
Don't have credit card accounts you don't need. A lot of available credit lowers your score and increases your credit risk.
Work with your creditors. A telephone call to explain why your payment will be late may prevent a delinquency from being reported.
Know your FICO score. FICO scores range from 300 to 850. Scores of 720 and above are considered top tier. These scores enjoy the best credit options. Conversely, scores of 620 and lower fall into a higher risk category.
Check your credit report for accuracy. You can inquire about your own credit through one or all of the credit reporting agencies (Experian, TransUnion, and Equifax) without it affecting your score.
There are no tricks or quick fixes to getting a good credit score, but you can raise your score over time by demonstrating a consistent history of responsible credit use. With a higher credit score you'll be able to qualify for better interest rates, higher credit limits, and more types of credit than you would with a low score, so it's always in your best interest to manage your credit responsibly.
Pay bills on time. Nothing ranks higher than consistent and timely payments.
Have credit cards - but manage them responsibly. Credit cards and installment loans that you pay on time will raise your score. Someone who has no credit cards tends to have a lower score than someone who has managed credit cards responsibly.
Maintain low credit card balances. Some experts advise not to use more than 50% of your limit on any one card.
Rotate and use all of your credit cards. Contrary to popular belief, a dormant account does not help your credit score.
Never use credit cards to pay other credit cards. It's better to pay down those you have. You can start with the ones with the highest interest rates or balances.
Don't open multiple accounts at the same time. Too many credit report inquiries lower your score and increase your credit risk.
Don't have credit card accounts you don't need. A lot of available credit lowers your score and increases your credit risk.
Work with your creditors. A telephone call to explain why your payment will be late may prevent a delinquency from being reported.
Know your FICO score. FICO scores range from 300 to 850. Scores of 720 and above are considered top tier. These scores enjoy the best credit options. Conversely, scores of 620 and lower fall into a higher risk category.
Check your credit report for accuracy. You can inquire about your own credit through one or all of the credit reporting agencies (Experian, TransUnion, and Equifax) without it affecting your score.
There are no tricks or quick fixes to getting a good credit score, but you can raise your score over time by demonstrating a consistent history of responsible credit use. With a higher credit score you'll be able to qualify for better interest rates, higher credit limits, and more types of credit than you would with a low score, so it's always in your best interest to manage your credit responsibly.
Tuesday, November 13, 2007
Increasing the Odds of Being Approved for an Unsecured Business Loan
The first thing that a business owner must have in order to apply for an unsecured business loan is a stellar credit rating. It is imperative that the business owner check into their own credit rating and that they request their credit report. Why should a business owner check their credit report? Quite frankly, the credit report may contain errors that will affect the business owner’s ability to get an unsecured business loan approved. A business owner can request their credit report from the three top credit reporting agencies, Experian, Equifax, and Transunion, and if there is an error, can dispute it and have it repaired before applying for an unsecured loan. Besides, in this day and age, when identity theft is prominent, it is a good idea to check one’s credit report at least once every year: if the individual finds unusual transactions being reported on their credit report, it will give the individual a clue that something is amiss.
A business owner also has a better chance of being approved for an unsecured loan if they have some money stored away in a savings account. By having money saved up, it shows the lending institution that the business owner is responsible when it comes to money management. The more money saved the better. Meanwhile, an active checking account that does not display any recent overdrafts is also a sign that the business owner is fully capable of managing their finances. Finally, if a business owner has a diverse financial portfolio, it will also indicate that the business owner is one that is looking toward the future and that they are an individual that has a keen awareness of their financial position.
A business owner also has a better chance of being approved for an unsecured loan if they have some money stored away in a savings account. By having money saved up, it shows the lending institution that the business owner is responsible when it comes to money management. The more money saved the better. Meanwhile, an active checking account that does not display any recent overdrafts is also a sign that the business owner is fully capable of managing their finances. Finally, if a business owner has a diverse financial portfolio, it will also indicate that the business owner is one that is looking toward the future and that they are an individual that has a keen awareness of their financial position.
Monday, November 12, 2007
The "Five C's" of Credit Analysis
What the Lender Will Review
Credit Analysis
Regardless of where you seek funding—from a bank, a local development corporation, or a relative—a prospective lender will review your creditworthiness. A complete and thoroughly documented loan request (including a business plan) will help the lender understand you and your business. The basic components of credit analysis, the "Five C's," are described below to help you understand what the lender will look for.
The "Five C's" of Credit Analysis
Capacity to repay is the most critical of the five factors. The prospective lender will want to know exactly how you intend to repay the loan. The lender will consider the cash flow from the business, the timing of the repayment, and the probability of successful repayment of the loan. Payment history on existing credit relationships—personal or commercial—is considered an indicator of future payment performance. Prospective lenders also will want to know about your contingent sources of repayment.
Capital is the money you personally have invested in the business and is an indication of how much you have at risk should the business fail. Prospective lenders and investors will expect you to have contributed from your own assets and to have undertaken personal financial risk to establish the business before asking them to commit any funding.
Collateral or guarantees are additional forms of security you can provide the lender. Giving a lender collateral means that you pledge an asset you own, such as your home, to the lender with the agreement that it will be the repayment source in case you can't repay the loan. A guarantee, on the other hand, is just that—someone else signs a guarantee document promising to repay the loan if you can't. Some lenders may require such a guarantee in addition to collateral as security for a loan.
Conditions focus on the intended purpose of the loan. Will the money be used for working capital, additional equipment, or inventory? The lender also will consider the local economic climate and conditions both within your industry and in other industries that could affect your business.
Character is the general impression you make on the potential lender or investor. The lender will form a subjective opinion as to whether or not you are sufficiently trustworthy to repay the loan or generate a return on funds invested in your company. Your educational background and experience in business and in your industry will be reviewed. The quality of your references and the background and experience levels of your employees also will be taken into consideration.
Credit Analysis
Regardless of where you seek funding—from a bank, a local development corporation, or a relative—a prospective lender will review your creditworthiness. A complete and thoroughly documented loan request (including a business plan) will help the lender understand you and your business. The basic components of credit analysis, the "Five C's," are described below to help you understand what the lender will look for.
The "Five C's" of Credit Analysis
Capacity to repay is the most critical of the five factors. The prospective lender will want to know exactly how you intend to repay the loan. The lender will consider the cash flow from the business, the timing of the repayment, and the probability of successful repayment of the loan. Payment history on existing credit relationships—personal or commercial—is considered an indicator of future payment performance. Prospective lenders also will want to know about your contingent sources of repayment.
Capital is the money you personally have invested in the business and is an indication of how much you have at risk should the business fail. Prospective lenders and investors will expect you to have contributed from your own assets and to have undertaken personal financial risk to establish the business before asking them to commit any funding.
Collateral or guarantees are additional forms of security you can provide the lender. Giving a lender collateral means that you pledge an asset you own, such as your home, to the lender with the agreement that it will be the repayment source in case you can't repay the loan. A guarantee, on the other hand, is just that—someone else signs a guarantee document promising to repay the loan if you can't. Some lenders may require such a guarantee in addition to collateral as security for a loan.
Conditions focus on the intended purpose of the loan. Will the money be used for working capital, additional equipment, or inventory? The lender also will consider the local economic climate and conditions both within your industry and in other industries that could affect your business.
Character is the general impression you make on the potential lender or investor. The lender will form a subjective opinion as to whether or not you are sufficiently trustworthy to repay the loan or generate a return on funds invested in your company. Your educational background and experience in business and in your industry will be reviewed. The quality of your references and the background and experience levels of your employees also will be taken into consideration.
Wednesday, November 7, 2007
Nationwide Unsecured Loans
Nationwide Unsecured is the United States' premier consulting organization when it comes to unsecured loan options. Where other companies fail,
Nationwide Unsecured succeeds. Whether the client needs the funds for business, start up, or personal reasons,
Nationwide Unsecured has the solution.
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