Bridge loans are a form of short-term funding intended to help your business buy assets or complete projects.
A bridge loan is a form of short-term financing that is designed to help a company meet its obligations until it secures a long-term business loan. This type of business loan is commonly used in commercial real estate and other transactions where timing is key and businesses need to secure funds quickly in order to take advantage of an opportunity.
When a business takes out a bridge loan, it uses the proceeds to purchase or improve assets, or to finance its own operations. Then, once it secures long-term financing, it uses the funds from the new long-term loan to pay off the bridge. Businesses use bridge loans (which often carry interest rates several points higher than conventional long-term financing) to fill short-term funding gaps. These include asset purchases, such as real estate, equipment, and inventory.
Learn whether a business grant or business loan is better for your business.
Running a business is expensive – plain and simple. At some point, there is a good chance you will need to seek additional funding from an outside source. One way to do that is through a business grant or loan. Although the two may seem similar, there are a few key differences that will make one type the better option for your business.
The other day, I read an article that blew me away. Writing in Forbes, entrepreneur Deborah Sweeney reminds us that until 1988, women entrepreneurs could not get business loans without a male relative as a cosigner. It didn’t matter if the male relative was even involved in the business, or if he was under 18; he was essential to experienced businesswomen getting the loans they needed to grow their companies.
“As a 43-year-old female CEO, it is difficult for me to get over that in my lifetime women business owners had to rely on men to obtain a business loan,” Sweeney writes.
It’s been a terrible summer for Lending Club and other startups that make loans to consumers and businesses online.
Shares of Lending Club are down about 30% since the beginning of June. That’s when the US Court of Appeals for the Second Circuit upheld a decision that could have the lenders lowering interest rates they charge a big chunk of customers.
Now, the US Supreme Court is its only hope. It could decide whether it’ll hear their case as early as October, according to a note this week from Morgan Stanley.
If you’re good about keeping your personal and business finances separate, you may think that the only credit score you have to worry about is your own. While maintaining good personal credit is certainly important if you’re applying for business loans, you may not realize that your company has its own credit score — and it’s just as essential to monitor.
“Businesses in the eyes of the law are treated like people,” said Jeff Stibel, CEO of Dun & Bradstreet Credibility Corporation, which provides credit-building and credibility solutions for businesses. “The smallest businesses tend not to incorporate or get a credit file, so they [think they don’t] have a credit score. Whether you’re proactively trying to get your score or not, it’s very likely that you still have one.”
With traditional credit channels squeezed so much that even the bank of mom and dad is tightening its belt, social lending services have moved beyond typical peer-to-peer to target the inter-family space, as Ian Clover discovered.