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How do you get a business loan for your start-up when you have bad credit or little cash flow? Collateral!
Lending is really a pretty simple business and I know you think it's not, because it seems like a big black box, but its not that tough. The things that are important in consumer world are also very important in the business world.
1. Capacity: Income, what are you and your company generating.
2. Credit: How have you paid your bills in the past. Your FICO score.
3. Collateral: Assets.
A lot of small business owners have had some hiccups, they've had some tough times. They don't have great credit, and maybe the cash flow hasn't been quite there. What do you do then? You look for collateral. That's assets. So assets come in a number of different forms. The most common is real estate. Also cars, not your broken down $500 Jalopy but a car that is worth a little bit and is not currently liened or loaned against. High-priced jewelry, art, oil and gas interests. Even your 401K and IRA. These things are all assets, so if you own them, and they are not already liened, which is a fancy lawyerly way of saying they have loans on them. They are free and clear.
Those are great things for a small business loaner. Full disclosure, I own a piece of a company called startup capital and expansion funding. We help startups and rapidly growing businesses get capital. So if you don't have good credit and your income is a little choppy, look at collateral or assets, that'll really help.
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Have questions? Book a call, and talk to Brett today:
https://clarity.fm/brettcenkus
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You can reach Brett through:
https://clarity.fm/brettcenkus
https://www.linkedin.com/in/brettcenkus
https://twitter.com/BCenkus
https://www.cenkuslaw.com
https://braatenwoods.com
https://merger-resources.com
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Brett A. Cenkus has 20+ years of experience in business law, finance, and entrepreneurship. Through Cenkus Law, PC, he provides advice and services for mergers & acquisitions (M&A), securities offerings, founders’ agreements, and other general business law issues.
Through Braaten Woods, LLC, Brett helps business owners in the lower middle market ($2MM - $25MM) position themselves for sale, find buyers, negotiate, and close M&A deals.
Brett also maintains merger-resources.com, a site packed with free articles, videos, checklists, deal diagrams, template contracts, and other tools to help pass M&A knowledge to others.
Brett regularly consults with entrepreneurs and invests his own capital as an angel investor.
From 2010-2013, Brett served as Chief Legal Counsel of a publicly-traded international oilfield services company. From 2001 to 2006, he and a partner founded and built Paragon Residential Mortgage. Bridge Investments acquired Paragon in 2006.
Brett holds a Juris Doctorate from Harvard Law School and a Bachelor of Arts degree in Economics from Messiah College in Grantham, Pennsylvania.
Brett lives in Austin with his wife, Cathryn, and his daughter, Elle. He enjoys reading, squash, classic movies, great food and wine, and the New England Patriots. [rjHRVIxnYf4] |