What Everyone Should Know Before Getting A Payday Loan

A fair number of individuals do not trust lenders that tack on excessive interest rates. The thing about payday loans is that they do have high interest rate. You are going to want to take note of that. The following tips can give you guidance on protecting yourself whenever you need to take out a payday loan.Never take out a loan for more money than you can reasonably pay back with your paycheck. There are many lenders that tend to offer more than what you’re asking since you’ll struggle to pay them right away. That means that can harvest more fees from you when you roll over the loan.Prior to agreeing to a payday loan, it is important that you aware of and agree to all the terms. Even if you need the money badly, you need to know what you are getting into, and make sure you are not falling for a scam.Try and pay off your loan as quick as possible. Paying in installments might be convenient, but you’ll be paying huge fees for the privilege. A good way to pay it down fast is to pay back more than you owe each month.Prior to agreeing to any loan, read the contract thoroughly. Some companies are phonies and are only after stealing your money.Make sure you’re dealing with a reputable lender prior to submitting any information about yourself. Look at reviews online to see what previous borrowers have said. Make sure the privacy policy is available to you.For those considering payday loans, make sure you know when you plan to repay it. The interest rates on these types of loans is very high and if you do not pay them back promptly, you will incur additional and significant costs.Beware of any company that wants to roll finance charges to the next pay period. When this happens, your money may all be going to the fees and not to the actual loan. You could wind up paying way more money on the loan than you actually need to.The local Better Business Bureau can give you information about payday loan companies, customer complaints and how those complaints were handled. There are lots of scammers out there who want to prey on the vulnerable. Always make sure you are dealing with a legitimate and reputable company.Remember that payday loan APRs regularly exceed 600%. The interest rate will vary by state. Just because you do not see that particular number in your contract does not mean your payday lender is not that high. This might be contained in your contract.If your payday lender is located far away, make sure they do not require documents to be faxed. Some lenders want you to fax documents, which is a hassle for many people because they do not have fax machine access. Faxing can easily cost a dollar or more for each page that is faxed.Many times a more affordable option to taking a payday loan is to get a cash advance at your job. Some employers allow paycheck advances, and that can save you a lot of money and future headaches. Always try this prior to applying for a loan.Try to get a payday loan over the phone. While applying online may seem easy, it is usually better to call for more information. Not only can you ask any questions you have, you can also make sure you understand all the terms and conditions of the loan.Those aiming to apply for payday loans should keep in mind that this should only be done when all other options have been exhausted. Payday loans have extremely high interest rates that can have you paying up to 25% of your initial loan. Look into any other options you may have before applying for payday loans.Thorough research is always a must if you’re planning on applying for a payday loan. The first payday loan you come across might not be the best one. The more lenders you look at, the more likely you are to find a legitimate lender with a fair rate. Although it might require a little time investment on your part, it can really pay off in the end by saving you money. You might even see all of this information on one website.Be sure to do research on a potential payday loan company. There are a lot of con artist lenders who will promise you a loan, but only steal your banking information. Use the Internet to thoroughly research what other customers have to say about a company before signing a contract.In some circumstances, a payday loan can really help, but you need to be well-informed before applying for one. You should have found great information about getting a quick loan and what to expect, within this article.

Reasons For Selling A Business

A business sale is not a “one size fits” all situation. The details that apply in a specific situation will not all be the same. Before proceeding further, it’s important to step back a bit and look at the big picture for business sales in a variety of circumstances. Not all business sales are for the same reasons, and the circumstances of the sale can have a big impact on how a sale should proceed.What KIND of Buyer is it?Before considering the various sale situations, it helps to consider the KIND of buyer. In almost all cases the buyer will be either another company or an individual.If the buyer is another company then it is likely the buyer will be able to run the business successfully. The buyer’s ability to pay may be fairly secure. Training the buyer may not be critical, but assistance with customer retention after the sale may be critical. The buyer may be more sophisticated, or at least have more sophisticated advisors. Consideration for the sale may include some form of performance based incentives (i.e., an “earn-out”).If the buyer is an individual, training the buyer may be even more important than assisting with customer retention. Since the buyer’s ability to run the business successfully may not be as certain as it would be if the buyer were another company with a proven track record, the cash and/or collateral the buyer brings to the table may be a major factor in the sale.The Most Common Sales SituationsThese are the most common sales situations. Whether you are a buyer or a seller, one of these situations most likely fits you. Additional details applicable to each are covered later in subsequent articles.Very Small Business – This is the most common business sale situationSometimes referred to as “Mom & Pops”, “Main Street Businesses”, etc.
Most of these businesses do not actually sell.
This is usually a sale to an outside individual (an “External Sale”).
Sometimes (although rarely) the sale will be to an insider (an “Internal Sale”).
It is rare to have an employee with both the interest and the ability.
The person needed can sometimes be recruited.
Can often be creatively structured as a win/win, even if the buyer has little money.Somewhat Larger Small Business – External SaleMore likely to sell than a Mom & Pop, but many never do.
Internal Sale
Easier to structure than for a Mom & Pop, but still difficult to find the right successor.
Family Sale
The IRS has insanely complex rules designed to make sure they get all the tax revenue they think they are entitled to. Which is A LOT.
Will most likely need an appraisal to support the price.DivorceOften VERY contentious, with expensive appraisal and attorney fees, and the eventual price and terms set by a judge.
Can sometimes be greatly simplified with advance legal planning (such as Shareholders Agreements).Partner BuyoutCan also be contentious.
Can sometimes be greatly simplified with advance legal planning (such as Shareholders Agreements).Sale for Health ReasonsIf the seller is in ill health but not clearly dying
Time is not as critical as for a dead or dying seller.
Potential buyers may try to take advantage of the situation.
The seller’s help with the post-sale transition may be affected.
If the seller is still alive but clearly dying
A sale planned to occur upon death can sometimes be arranged.
This has the potential to save a LOT of tax.Seller (business owners) has passed awayThe company may be in turmoil.
Can be VERY difficult to find a buyer.
Tax issues can be VERY complex.Financially Distressed SaleIf the business is in trouble, the buyer will need to see a way to fix the problem, or a sale will not happen.
Often involves simply liquidating the assets and walking away.
May be forced by the company’s lenders.Sale to a Large BuyerLikely to be fairly sophisticated buyers.
Likely to include an “earn-out” as part of the “price”.
Publicly traded buyers
May involve tax-advantaged strategies involving the buyer’s stock.
Large, closely held buyers
May be easier to attract than a publicly held buyer.Start-upsOften done with personal funds.
If funding is from family and friends, then their ownership must be decided.
If Venture Capital is involved, then complexity goes way up.
Usually only available if the upside potential is very high.
Initial Public Offerings (“IPO’s”)
Basically, this is selling part of the company to the public in the form of company stock.
Often involves venture capital at an earlier stage.
VERY complex.Employee Stock Option Plan (ESOP)Very complex and expensive.
Can have significant tax advantages.
Might have motivational effect on employees.
Not as popular as initially expected when these were created.Very Small BusinessesThese businesses are sometimes referred to as “Mom & Pops”, “Main Street Businesses”, etc. Although each company is small with only a few employees, they represent a huge part of the goods and services available in our economy, and are the embodiment of the American Dream for many people.Attempted sale of these businesses is the most common business sale situation. Unfortunately, most of the time they never actually sell. Some estimates are that only one in seven of these businesses will actually sell once they are listed for sale. Many more simply shut down once the owner decides to move on to something else.Unrealistic expectations on the part of the seller, particularly the value of the company, are one of the reasons blocking sale of many of these companies.The value of these companies is NOT the value of the company to the seller, which may be quite high. Instead, the maximum value is limited by the cost a potential buyer would incur to start a similar business instead. That means the value may be determined by the value of the equipment, plus something extra for the “running start” available to the buyer from buying the existing business instead of starting a similar operation from scratch.Formal valuation approaches based on the net present value of expected future cash flow, net of reasonable compensation to the owner, often do not apply. Instead, rules of thumb based on some multiple of sales plus the value of the equipment acquired are often used. These rules of thumb have even been published in a book, theBusiness Reference Guide, The Essential Guide to Pricing Businesses and Franchises, compiled annually by Tom West and available through Business Brokerage Press and available on the web at www.bbpinc.com. (One of the authors of the article you are reading right now is one of the contributors to this book.)It is important to remember that these rules of thumb are GENERAL rules, and may not be valid for a specific situation. It is also important to remember that these rules of thumb were developed based on businesses that actually sold. That means they are biased in favor of the most attractive businesses offered for sale. The businesses that never sell have very little impact on these rules of thumb.Ultimately, the value of these businesses is determined just like the value of any other business: What a willing buyer and willing seller agree on. Both sides must see it as in their best interest to do the deal, or it will not happen. In other words, it must be a win/win or it will not happen.One way to sell these businesses is to arrange an internal sale. The key to this is finding a person(s) who has the necessary skills and entrepreneurial drive. Entrepreneurs are often harder to find than the people with the necessary skills. For companies that do not already have that person, it may be possible to recruit them based on the possibility of their buying the company in the future.Sales of this type can be arranged even for buyers who do not bring much of their own money to the table. Finding advisors who can assist with this can be challenging as well.Somewhat Larger Small BusinessesOnce a business has grown past the “Mom & Pop” size, it may be a bit easier to sell. There is no generally agreed minimum size for this, but these businesses often have ten or more employees.Many of these businesses are only marginally profitable, and will be priced using similar methods to their smaller cousins. Those that are profitable enough will be priced based on the adjusted profits a buyer can reasonably expect in the future. The key to their sale will be the ability of the buyer to continue operating the business profitably in the future, which often means the seller will need to help with the transition.Much of the literature on buying and selling a closely held business is focused on businesses this large or larger, and assumes the buyer will be either an outside individual, or another business. Little attention is paid to the possibility of an inside sale.These businesses are easier to arrange internal sales for than their smaller cousins, although it is still rare to see this done. Finding entrepreneurs is always hard, and few advisors understand the issues enough to help.DivorceA divorce often means half the business must, in effect, be sold to the spouse who runs it. If both spouses worked in the business prior to the divorce, one of them most likely will seek employment elsewhere.The biggest question in these sales is usually price. Terms tend to be based on asset trade-offs, with cash paid for whatever value cannot be offset by other assets. Bank financing is sought as necessary to provide the cash. Appraisals are used to establish value, with a judge determining the final result if the appraisers used by each side differ in their opinion of value.Advance legal planning, including agreement on how value will be determined, can help simplify the process dramatically. Most owners are aware of the possible use of a pre-nuptial agreement but do not have one. Less well known is that a proper Shareholders Agreement can simplify the divorce issues, including valuation, by quite a bit.Shareholder/Partner BuyoutBuying out a fellow shareholder/partner may or may not be a contentious process, but it is still likely to involve disagreement over value. EVERY multi-owner business should have a Shareholders Agreement (or equivalent) to address the multitude of issues that need to be spelled out in advance in this situation. How value will be determined, as well as the terms for a buyout, is just one of the topics that should be covered in this agreement.This is a huge topic with its own article later in this series.Sale for Health ReasonsMany sales are triggered because the owner is in ill health but not clearly dying. The seller has a very good reason to want to sell, but is not under pressure to do so immediately. These sales are very similar to any other sale for a similar business except the seller may not be able to provide as much help during a transition. If an internal sale is desired there may not be enough time to recruit key employees, and longer term planning may not be an option.If the seller is facing a potentially terminal disease, the sale will be much more complex. Seller assistance post-sale is much more problematic, thus lowering the value to a potential buyer. Likewise, the business itself may be suffering from neglect by the owner because health matters take priority. The seller will be at a disadvantage in negotiations as well, since potential buyers may sense the seller HAS to do the sale.Tax planning for the seller’s heirs may play a major role for a seller facing a terminal illness. The tax issues include potential estate taxes, plus potentially dramatic differences in how the sale itself will be taxed.It is possible to plan a sale in advance, with the sale itself being deferred until the seller’s death. As a protection to the buyer, the sale generally includes a “no later than” sale date, and may include provisions for the buyer to operate the business prior to that date as well. In the right circumstances this can reduce taxes substantially, provided the sale itself is structured properly. The technical elements in the sale structure for this situation may be quite different than for a typical sale.Financially Distressed SaleSome businesses are put up for sale as a last ditch attempt to avoid bankruptcy or being forced to shut down. In some cases the business will go through a formal bankruptcy process, with the court eventually approving a plan to reorganize the business or mandating the business be liquidated if a credible plan to return the business to profitability cannot be developed.If an outside buyer is sought, the potential buyer will need to see a way to fix the problem causing the financial distress, or the buyer will not buy. Sometimes this will involve buying only the profitable parts of the business, leaving the difficult parts behind. This can also lead to unexpected legal complications on both sides of the sale, so be sure to include experienced legal counsel in the process.If no way can be found for a buyer to solve the underlying problems, or the profitable portions of the business (if any) cannot be sold separately, then the business is unlikely to be salable as a going concern. In that event the business will most likely be forced to simply sell off its assets, apply the proceeds to its liabilities, and then go away. If liabilities remain and the owner is legally liable for them, the owner may have to personally make up the shortfall.Sale to a Large BuyerLarger buyers are likely to be another company, often in the same industry. They generally have the ability to run the acquired business successfully, and are often more sophisticated that the typical individual buyer.These buyers are not typically interested in “Mom & Pop” businesses. The “price” they are willing to pay is likely to include a portion of the consideration in the form an “earn-out” based on performance of the acquired company after the sale. If the buyer is a publicly traded company, the sale may sometimes include use of the buyer’s stock to help improve the tax effects on the seller, and to reduce the cash required by the buyer.Start-upsStarting a company is often done with personal funds and does not involve sale of part of the company. If family and friends are used to help with funding then a loan will be required, or the other investors must have some equity in the company (or both).

No Doc Loans from Private Lenders

Unlike banks, No Doc Loans from Private Lenders or hard money is supplied by private money lenders. The term hard money implies that it is secured by real assets, such as a property. Hard money loans are generally easier to obtain as compared to bank loans. But they come up with huge cost and risk to the borrower. Many startups or new entrepreneurs go for this option when they fail to get any bank loans. Let’s discuss some of the important concepts attached with a private money lender.

Private Lenders

Private Lenders are any individuals or firms that has an amount of money to lend to a borrower. Some hard money lenders have a large amount of cash available which a small number of people or businesses tend to borrow. Other lenders are large firms who have hundreds to thousands of clients in small businesses or individuals. These lenders are normally merchant cash advance providers that lend money to businesses on the condition of receiving a share in their future earnings.

How process works?

Hard money lenders loan money to small businesses and individuals and secure the loans as a share in the borrowing party’s returns. Obviously there are certain limitations in this process. Lenders tend to pick up only those businesses who have a solid security to offer, for example, a house which will be taken over by the lender in case of non-payment. However, another option lenders go for is asking a share in the business’s future earnings. A percentage of the business’s credit card transactions is automatically deducted in this process to provide the lenders their share of return on loan provided.

Risks associated with Private Lenders


One major advantage that money providers get after giving loans is to work along with small businesses. The loans are very easy to apply and can be received within a few days of application. Another major benefit for businesses is that they do not have to provide a proven sales or business record to loan providers. This is especially helpful for start-ups.


Due to the high risks associated with borrowing money from a lender for any startup, you need to thoroughly check the lender’s profile and lending history. Try to approach other borrowers who have worked with this lender and get to know their experiences. You can also check your local Better Business Bureau to see if there are any complaints lodged against the lender.

Facts You Should Know About Low Doc Home Loans in Australia

Low doc home loans are those loans where the Self Employed borrower is either unable to or reluctant to submit evidence of lodged tax returns. Thus these loans are classified as high-risk home loans. A low-doc home advance is riskier when contrasted with the standard home credit yet it still has its very own requirements, which you should furnish to the bank so as to get an endorsement for the advance.

The requirements for securing a low doc home loan include:

As a borrower, you should probably give plentiful verification of having an unmistakable or great credit history. On the off chance that you have 2 small paid defaults, at that point also your advance will endorse yet anything over that will meet with dismissal. The 2 small paid defaults are allowed just if the amounts are under $500 and in the event that they are telco-related.

As a borrower, you should offer at least 20% value as security, in spite of the fact that the percentage may change starting with one loan specialist then onto the next and some lenders may take over 20%.

As a borrower, you will be required to demonstrate that you have experienced a registered ABN process for a specific time frame.

If you are unable to give confirmation of pay then you will be required to fill an income verification document.

Most of the low doc home loans interest rates are risk insured. There are some lenders who may absorb a specific cost appended to your mortgage insurance premium.
Most of the low-doc home loans are accessible either through non-banks or through non-conforming lenders.

The interest rate that is offered on any of the low doc home loans is regularly higher than any of the standard variable interest rate home loans. Off late, lenders have started to offer similar rates for both variable and low-doc home loans. There are a couple of differences between a standard home credit and a low-doc home advance and they are:

Low-doc home loans won’t require verification of pay or evidence of lodged tax returns, which is required while taking a standard home credit. You will need to have your Accountant verify the income stated or supply lodged BAS statements or Business Bank Statements to confirm the income declared.

Low-doc home loans are an increasingly appealing alternative for the Self Employed Australian.