Business Finance

A small business loan can be invaluable when you’re establishing your business or when an unforeseen setback occurs, but you don’t want a loan to be short-term gain and long-term pain. Here are six common mistakes businesses should avoid when it comes to commercial finance.   Mistake #1: Not getting the right loan A thriving business requires enough capital to meet expenses, expand and invest, but it’s important to know why you need the funds and what loan best suits that need. Do you need to cover short-term cash flow shortages, for example? A line of credit could help, where you can access funds up to a pre-approved limit, and only pay interest on the outstanding balance. Maybe you need new equipment? In this
Just like you, banks are in business – and they don’t succeed by making bad deals. When they consider your loan application, they’re calculating the financial risk of entering into an arrangement with you. Let’s break it down. What the bank considers For the bank, financial risk comes down to whether you can repay your commercial loan and the interest in the agreed time. According to the Australian Bureau of Statistics, as of June 2016, the exit rate across all Australian businesses was 12.3% (percentage of businesses that ceased trading). To protect itself, the bank is looking for evidence that your business won’t fall among these statistics and fail to repay the principal amount. When assessing financial risk, one of the main factors the bank
Everyone wants to pay less on their mortgage, and refinancing is one strategy to help lower your interest rates – but is it worth it? We take a look at how you can get the most out of refinancing. Why refinance? Generally, people refinance to negotiate a better deal on their home loan and pay it off sooner. Depending on your situation, you should be able to save money by taking advantage of lower interest rates, or new products that weren’t available when you first negotiated your home loan. To help put it in perspective, let’s say you previously took out a $300,000 loan at 7.5% over 30 years with monthly repayments of $2,098. If you refinanced to a new loan at 4%, you
Small business loans can be great when you need to get your brand up and running or cover unexpected expenses. However, it’s useful to understand the difference between the available options before committing to one. To help you make the right choice, here’s what you need to know about some of the more commonly used business loans.   Line of credit/overdraft A line of credit involves overdrawing on your business’s bank account up to an amount approved by your financial institution. This is commonly used for short-term capital, or as a source of cash flow to keep operations running smoothly. Pros: Flexible – use funds as needed and repay at your own pace. Allows you to establish a good credit history for future borrowing.
When people buy property together, particularly if it’s with a partner or spouse, they often register the title in both people’s names – especially if they’re going to live in the property. But other arrangements are possible, several friends might opt to own individual shares in a property, for example, or a couple might choose to have only one of their names on an investment property title. The following information provides you with a good starting point to help you on your way.  Also tax legislation and other Australian laws governing property ownership and investment are complex, so seek proper legal and financial advice before entering into any arrangement. Joint-ownership titles The two main types of joint-ownership titles in Australia are joint tenancy and
There are many perks to working for yourself, but when it comes to applying for a home loan, it seems being your own boss sends up a red flag to banks and other lenders. Why? A salaried employee has a regular, steady income and is less likely to experience the cash flow volatility of a small business owner, contractor, entrepreneur, tradesperson or freelancer. Yet by being proactive and accessing specialist advice, self-employed applicants can also enjoy a successful and hassle-free road to securing a home loan. Try these top tips for starters.  1. Seek expert advice Trying to navigate the home loan landscape solo may not produce the outcome you desire. There are many experts who can help self-employed people access a home loan,
No one likes paperwork; however, providing your broker with the right documentation will save you time and money. What information will your broker ask you to provide? When you ask to enlist the services of a broker, they will probably ask you for the following documentation: Identification, including photo ID such as driver licence Income verification documentation such as recent payslips Birth certificate, if you are applying for a government funded first home owner grant Depending on the lender or bank you would like your broker to apply to for your loan, you may also be asked to provide: A recent PAYG summary A notice of assessment from the Australian Taxation Office Tax returns Proof of your contribution toward the transaction, such as savings
Many mortgage brokers can help with your home loan and your business loan. There are several types of commercial and asset finance, so make sure you know the differences. Then you can decide which one will suit you. What is commercial finance?  Commercial finance is an umbrella term for different kinds of business loans. They’re designed to help manage your capital and cash flow. Types of commercial finance Business overdraft: Your financial institution allows you to overdraw your existing business account up to an approved limit. You can only access the overdraft after your own funds have been used. The lender charges interest on the overdrawn amount. Businesses often use overdrafts as small loans, usually to cover cash flow gaps. Line of credit: A
With so many products offered by various lenders, it can be quite perplexing trying to figure out whether or not you’ve scored yourself a good deal on your home loan. While doing your research and comparing what’s out there in the market is one of the most obvious ways to find out whether you’re sitting on a good deal, it can be a time consuming practice and an overwhelming experience for those without specialist knowledge of the mortgage sector. It’s good to shop around, and yes you can use comparison websites, but because lenders call like products different names, it can get very difficult comparing apples with apples. Brokers know the special names and pricing, so it’s worthwhile working with one as not only
A home loan is generally a long-term proposition, but in some situations it can make sense to refinance your mortgage. Read this guide to the refinancing process, and speak to a mortgage broker, before deciding whether it’s right for you. Refinancing involves taking out a new mortgage and using those funds to pay off your existing mortgage. Doing so can save money and result in significant financial gains over time.  Why you might refinance You might want a lower interest rate. The lending products market is highly competitive and interest rates can vary significantly between banks. One of the most common reasons people choose to refinance their mortgage is to secure a lower interest rate from another lender. This could assist you to pay
So you’ve decided to partner with a mortgage broker to smooth your first – or return – entry into the world of property, mortgages and loans. But before you choose your mortgage broker, it’s worth understanding the value they bring to the lending equation, and also how their commission structure works. After all, if you’re not paying the broker for their service and advice, who is? What can I expect from a mortgage broker? A mortgage broker will work with you to understand your goals and objectives, as well as your borrowing capacity, and will help you secure a loan that meets your needs from a panel of lenders. This includes reviewing a range of loan products, negotiating with panel lenders on your behalf
It’s often said that Australians are more likely to divorce their spouse than switch banks. But with plenty of competition in the home loan sector, refinancing can be a good move. You might want to refinance for a number of reasons – you can consolidate debt from high-interest credit cards into a home loan with a lower rate of interest; you can release cash from your home loan equity for other major purchases; or you might want to simply save on your repayments by moving to a loan with a lower interest rate. What’s my rate? If you aren’t 100% sure exactly how much you’re paying, how can you find a better deal? Luckily, finding out your interest rate can be as simple as

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