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  1. loanuniverse

    S Corp

    Just a little edit, I realized I typed the answer too fast and made a mistake. Apparently, you can not edit your posts.
  2. loanuniverse

    S Corp

    The personal information will not be needed or required to incorporate. Most states will require that the officers and the registered agent are disclosed, and that information is readily available for anybody to look up. There are a couple of states where all you need is to have a registered agent that will act as a proxy. One thing to remember is that the officers of the corporation do not necessarily have to be the officers of the corporation. The reality is that in order to do a lot of things, your name will need to appear in the corporation documents. Example: Most banks will require a certified copy of the incorporation articles. Costs vary from state to state. From less than a hundred dollars to a few hundred. Annual fees are also required to remain active. Your best bet is to google your state specific information. Make sure you go to .gov sites for your info. Forms are readily available online and you should be able to file yourself. The true question, is why do you want to incorporate? The only reason to do so in my opinion is if you are going to be doing actual business and you want to benefit from the legal protection of a separate entity. If it is just for the purpose of getting credit, then you are talking about some expensive and limited vendor credit.
  3. This is a bit long, but might be helpful Your best bet like I said in my original post would be to contact other banks that might be interested in doing the deal. There is still a lot that I do not know about the request and there are questions that a banker will probably ask, but these are my thoughts in no special order. You mentioned that the credit history might not be up to par for the bank that has financed trucks for him before. This is troublesome specially since this bank did business with him before, and now is not interested in doing business. This bank should know him best. I am also concerned because it is hard to quantify what “not up to par” means? Does it mean a 550 credit score or a 670 credit score? From looking at some small business lending credit procedures, I can tell you that the sweet spot is around the 650 score for a lot of a lenders. If you have less than that you might not even qualify for some loans, and if you do there will be a higher rate associated with the financing. Bottom line regarding credit score: He needs to get it to 650. That would be the first thing to do since small business lending relies a lot on personal credit score. Now lets work on the loan. If this were my business or I was tasked with getting the debt refinanced, I would try to get an SBA loan from a local bank lender. I would do that by approaching the banks and asking for their SBA lender. Your goal here is not only to lower the rate, but to stretch the principal repayment by resetting the amortization. If you can make a good case for the useful life of the truck being 10 years, you might get another 7 years to repay. Of course this does not have a chance unless the ability to repay is there so you would need to be familiarized with “traditional cash flow” and “debt service coverage” calculations. Heck, if this was my company I would prepare an easily digestible memo for the lender outlining the following: - Introduction to the company, its history and the contracts that it has. The goal here is to put the company in the best possible light not only about current operations, but the near future. - The request {amount, amortization requested, ask for a good rate which would be about 6% for a term loan between 5 and 7 years} - A listing of the trucks with the vin #s and their estimated market values. Make sure to note what their expected useful lives are to support the longer amortization. I might even attach some pictures. - A calculation of the company’s debt service under the current rate and a 6% rate. You might or might not get a 6% rate, but it is a good place to start. This is to point out to the lender the positive impact on your cash flow that the transaction would have. Remember that the two keys to make this happen are a personal credit score over 650 and a debt service coverage of at least 1.25X
  4. No borrowing relationship with his bank, just checking and payroll... His interest rate was ridiculous with the builder of the trucks, his personal credit was not up to par for the bank that has financed 8 other trucks that we have.. if we can refinance we would save aprox. 900 per month per refinanced truck.... The ability to repay is not a problem, just wanted to free up some cash flow...as stuff runs lean when we get paid once a month and payroll is every two weeks.... so freeing up about 4-5 grand would be ideal
  5. This is exactly the type of loan that a small business bank does. The only thing out of the ordinary is that he needs/wants to refinance these five trucks halfway through the term. Is there a reason why his current bank is not interested? Is there a borrowing relationship with that bank already? If it is just a case of the current bank not wanting to do that type of loan, and not a case of the current bank being concerned about the ability to repay then you might be able to find another bank to do the deal. It will be a matter of contacting a couple.
  6. I do not think they do. Did you give a guarantee?
  7. When you invest in those Peer to Peer lending sites, you are actually giving unsecured loans to the companies. Your return might be tied with the performance of specific loans, but in case of financial trouble by the company you will be just another unsecured creditor. This means that your position is similar to that of a bondholder. I am not sure about the financial performance of lendingclub, but I know Prosper is loosing money and will need to sell more equity to survive in the near future. If you are going to be investing in Non Rated bonds, you better be compensated accordingly.
  8. You want it to be liquid and you want it to be safe. FDIC insurance is your friend. While rates are low for CDs, for that kind of money it actually makes more sense to open one of those money market accounts that pay a bonus. Check out https://www.everbank.com/ they are running a special that pays 1.25% just make sure you read the small print in case they have an early closure penalty. I did not read the small print.
  9. If you are going to put something, it should be the truth. The only thing that I could recommend is that date of incorporation does not mean that this is the date the business started. If you were in business before that date, that would count. But do not lie.
  10. The website seems to still be under construction, which is concerning. Specially since there are some important pages that are missing information. It also seems as if they match you with someone with good personal credit in order for your request to get qualified. I see some potential pitfalls in that approach as the person who is providing the good score will most likely have to guarantee whatever deal they get you.
  11. There is always a chance, but I disagree with it being a huge chance. I think there are other places that might get affected first. Even if they stopped the whole Roth IRA program tomorrow, can you imagine the chaos if they did not grandfather the existing accounts.
  12. More than likely that credit card debt is personally guaranteed by you in spite of it being in the business name. I would thread carefully when dealing with negotiators/consolidators/advisors that say that they can lower the debt. Lots of horror stories around.
  13. I like the idea, but $100 a month in stocks means that you would have to bundle several months unless you want transaction costs to eat your returns. Also the small amount makes it difficult to diversify. How about an ETF that invests in preferred stock {diversification would lower risk} http://finance.yahoo.com/q?s=PFF
  14. D&B has become a profit center whose sole mission is to sell to small business owners these credit builder solutions instead of focusing on creating good reports for the lenders. I swear to God they are persistent and annoying. Every time that I look up my own company on their iupdate {previously eupdate}, they follow up with 5 calls trying to tell me how my business file is incomplete and it might be costing me both business and credit. If you want to build a paydex, follow the instructions here and apply to all of the vendors that provide terms. Eventually you will get rated.
  15. I think it won't let you use something like SERVICE TECH, INC. because the name is taken by a dead corporation according to their records. I think as long as you meet the following, you should be able to get it approved. Just search it before applying search result

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