by ARTIS COMMERCIAL CAPITAL | Jul 11, 2023 | Blog
Are you a small business owner looking for financing options? Traditional bank loans can be difficult to get, especially if you have bad credit or lack the necessary collateral. Fortunately, there is an alternative—asset-based lending. Asset-based lending provides businesses with access to capital while allowing them more flexibility than traditional loans.
What Is Asset-Based Lending?
Asset-based lending is a form of financing that relies on the value of a company’s assets as collateral. This type of loan can be used to finance a variety of needs, including starting up a business or expanding operations. It offers businesses more flexibility than traditional bank loans because it focuses on the value of the assets rather than creditworthiness.
Easy to Obtain
One advantage of asset-based lending is that it is easier to get approved for compared to traditional bank loans. As mentioned before, banks typically require good credit and collateral, which many small businesses don’t have access to. With asset-based lending, all you need is an inventory or other assets with sufficient value—you don’t have to worry about your personal credit score or lack of collateral.
More Capital then Institutional Loans
Another advantage is that asset-based loans can provide businesses with more capital than traditional bank loans. Because the loan is secured by assets, lenders are willing to offer larger amounts of money than they would for an unsecured loan. This can be especially useful for small businesses that need extra funds to grow their business but may not qualify for a traditional bank loan.
Flexible Repayment
Finally, asset-based lending offers flexible repayment options. Unlike traditional bank loans, which require regular monthly payments over a fixed period of time, asset-based loans allow you to pay back the loan amount in installments or on an as-needed basis based on your cash flow. This makes it easier for small businesses to manage their finances without worrying about meeting strict repayment deadlines.
Getting Approved for Asset-Based Lending
To increase your chances of getting approved for an asset-based loan, make sure you have a detailed business plan that outlines how the money will be used and why it is needed. Additionally, provide the lender with accurate information about your assets—including inventory count, estimated value, and past performance data—so they can evaluate your application objectively. Finally, be prepared to pay fees associated with this type of loan; these may include appraisal costs or other setup fees.
In conclusion, asset-based lending provides small businesses with access to capital while offering more flexibility than traditional bank loans. By understanding how asset-based lending works and taking steps to increase their chances of approval, business owners can take advantage of this unique financing option to get the funding they need. Contact Artis Commercial Capital today to learn more about our asset-based lending solutions.
by ARTIS COMMERCIAL CAPITAL | Jul 4, 2023 | Blog
If you’re a business owner, you know how important it is to have access to the right kind of funding in order to help your business grow. One option that many businesses are turning to is purchase order financing. This type of financing can be used for a variety of purposes, from purchasing inventory and supplies to expanding operations or hiring new employees.
How Purchase Order Financing Works
Purchase order financing is a type of short-term financing that enables businesses to pay for goods and services they have ordered from suppliers. With this type of funding, businesses can finance purchase orders for inventory or supplies without using their own cash flow or borrowing money from a traditional lender. Purchase order financing is an attractive option for many small businesses as it provides them with the necessary funds to grow without having to wait months or years until the product is sold.
This type of financing works by allowing a third-party lender to provide funds in exchange for a portion of the total cost of the purchase order that will be paid on delivery. The lender assumes part of the risk associated with completing the project, so they will typically require some form of collateral or guarantee before approving a loan. Once the order is fulfilled, the lender will receive their portion of the total cost plus a fee for providing the funding.
Growing Your Business
Purchase order financing can be beneficial to businesses in a number of ways. It can help businesses that need funds quickly to purchase supplies and inventory without having to dip into their cash reserves or take out loans from traditional lenders. This type of financing also helps companies expand operations without waiting months or years until product sales are sufficient enough to cover such costs. Additionally, it can help businesses build relationships with suppliers by allowing them to pay suppliers on time for goods and services they have ordered.
Overall, purchase order financing is an attractive option for many small business owners as it provides them with the necessary funds to grow without having to wait months or years until product sales are sufficient enough to cover such costs. If you’re looking for a way to finance your purchase orders and help your business expand, this type of financing might be right for you. Reach out to the team at Artis Commercial Capital today to learn more about our purchase order financing program.
by ARTIS COMMERCIAL CAPITAL | Jun 27, 2023 | Blog
Investing in commercial real estate is a great way to generate passive income and build long-term wealth. However, diversifying your portfolio is essential if you want to maximize your returns and minimize risk. By investing in different types of properties, you can spread out the potential risks associated with any one property or market. The key is to understand the various types of commercial real estate investments available and how they fit into your overall strategy.
Invest in Different Property Types
One of the best ways to diversify your commercial real estate portfolio is to invest in different types of property, such as office buildings, retail stores, multi-family dwellings, and industrial spaces. By investing in a variety of property types, you reduce the risk associated with any one particular market or sector. Investing in multiple properties can also provide the benefit of cash flow diversification, allowing you to spread out your income across various types of investments.
Invest in More than One Location
Another way to diversify your commercial real estate portfolio is to invest in different geographic locations. By investing in properties located in diverse economic climates and regions, you reduce the risk associated with any particular market or location. Investing in different markets can also provide the benefit of diversifying your tenant base, allowing you to spread out income across various types of renters.
Invest in Development Projects
Finally, it’s important to diversify your commercial real estate investments by investing in different stages of development. Investing in both newly-constructed and existing properties could yield higher returns over time because these investments can take advantage of different tax benefits and depreciation schedules. By investing in properties in various stages of development, you reduce the risk associated with any one particular market or sector.
Diversifying your commercial real estate portfolio is essential to maximizing your returns and minimizing risk. By investing in different types of property, geographic locations, and stages of development, you can spread out the potential risks associated with any one market or sector, allowing you to maximize your return on investment. Artis Commercial Capital provides financing to property investors that want to expand and diversify their portfolios. Contact our offices today to explore your options.
by ARTIS COMMERCIAL CAPITAL | Jun 20, 2023 | Blog
Mezzanine financing is a form of debt capital that can be used to finance commercial real estate investments. It provides an alternative source of funding for property investors who are not able to secure traditional bank loans or other forms of conventional financing. Mezzanine financing has become increasingly popular in recent years as it offers the potential for higher returns than traditional methods and can help bridge the gap between equity and debt when there isn’t enough capital available from either source alone.
An Overview of Mezzanine Financing
Mezzanine financing typically involves a loan secured on the value of a property, but with a repayment structure that is more like equity than debt. The lender will usually require some form of security, such as a second mortgage or a lien on the property, and if the borrower defaults on the loan then the lender can take possession of the property. A mezzanine loan can provide a significant amount of capital for the borrower and often offers high returns for the lender, which is why it has become an attractive option for both sides.
Mezzanine financing is seen as a riskier form of lending by banks and similar lending channels, which is why commercial and private lending firms offer this solution. The repayment terms are also less flexible and typically require more frequent payments in order to reduce the lender’s risk. This can make it difficult for some borrowers, especially those with limited cash flow or high levels of debt, to keep up with their repayments. For these reasons, mezzanine financing is typically reserves for high-net worth property investments.
Mezzanine financing can be a great option for property investors looking to finance their next project. It provides access to capital that isn’t available through traditional channels, and it’s often the only way to bridge the gap between equity and debt when there isn’t enough of either source alone. Contact Artis Commercial Capital today to learn more about our equity financing solutions.
by ARTIS COMMERCIAL CAPITAL | Jun 13, 2023 | Blog
Commercial real estate financing is an important and often complex part of the industry. Knowing the difference between small balance and large balance financing can make all the difference when it comes to securing a loan for your project.
Small Balance Financing
Small balance loans are typically used for smaller commercial real estate projects such as purchasing a property, refinancing an existing loan, or making improvements to the property. These loans usually range from $1 million and below, with interest rates that can be fixed or adjustable, depending on your needs and creditworthiness. Smaller balances are often easier to secure than larger loans and they often come with more flexible terms, such as lower down payments and longer repayment plans.
Large balance loans are typically used for projects that require a much larger amount of capital, usually over $1 million, and often ranging into the billions of dollars. These loans can be used for anything from renovations to constructing an entirely new building. The interest rates on these types of loans tend to be higher than on small balance loans, and the repayment plans are often longer with more stringent terms. Large balances also require a greater amount of collateral, such as existing property or other assets, making them more difficult to secure.
The type of loan you choose will ultimately depend on your particular needs and situation. If you are looking for a short-term solution or need more flexibility in the repayment options, then a small balance loan may be best. Artis Commercial Capital provides financing solutions for both small and large development projects. Whether you need $1 million or your project requires funding in the billions of dollars, we have you covered. Contact our team today to learn more.
