Assumption of Mortgage
An obligation undertaken by the purchaser of property to be personally liable for payment of an existing mortgage. In an assumption, the purchaser is substituted for the original mortgagor in the mortgage instrument and the original mortgagor is to be released from further liability in the assumption, the mortgagee's consent is usually required.
The original mortgagor should always obtain a written release from further liability if he desires to be fully released under the assumption. Failure to obtain such a release renders the original mortgagor liable if the person assuming the mortgage fails to make the monthly payments.
An "Assumption of Mortgage" is often confused with "purchasing subject to a mortgage." When one purchases subject to a mortgage, the purchaser agrees to make the monthly mortgage payments on an existing mortgage, but the original mortgagor remains personally liable if the purchaser fails to make the monthly payments. Since the original mortgagor remains liable in the event of default, the mortgagee's consent is not required to a sale subject to a mortgage.
Both "Assumption of Mortgage" and "Purchasing Subject to a Mortgage" are used to finance the sale of property. They may also be used when a mortgagor is in financial difficulty and desires to sell the property to avoid foreclosure.
Amortization
A payment plan which enables the borrower to reduce his debt gradually through monthly payments of principal.
Adjustable-Rate Mortgage (ARM)
A mortgage where the interest rate is not fixed, but changes during the life of the loan in line with movements in an index rate. You may also see ARMs referred to as AMLs (adjustable mortgage loans) or VRMs (variable-rate mortgages).
Balloon Mortgage
A short-term fixed-rate loan which involves smaller payments for a certain period of time and one large payment for the entire amount of the outstanding principal. Usually they have terms of 3, 5, and 7 years.
Biweekly Mortgage
A mortgage which requires a payment for half the monthly amount every two weeks. As a result the loan amortizes much faster than a loan with normal monthly payments. For example, a 30 year fixed rate loan will be paid off in approximately 19 years.
Blanket Mortgage
A mortgage covering at least two pieces of real estate as security for the same mortgage.
Bridge Loan
An interim loan is made to finance a buyers new residence if the buyer is unable to sell his/her current residence but needs money to close the transaction.
Capital Gains
Profit earned from the sale of real estate. The new tax code does not tax the profits from the sale of a home if the proceeds are used to buy another house costing at least as much as the sales price of the old one.
Saturday, November 17, 2007
Government loans
FHA Loans
The Federal Housing Administration (FHA), which is part of the U.S. Dept. of Housing and Urban Development (HUD), administers various mortgage loan programs. FHA loans have lower down payment requirements and are easier to qualify than conventional loans. FHA loans cannot exceed the statutory limit. Go to FHA Programs page to get more information.
VA loans
VA loans are guaranteed by U.S. Dept. of Veterans Affairs. The guaranty allows veterans and service persons to obtain home loans with favorable loan terms, usually without a down payment. In addition, it is easier to qualify for a VA loan than a conventional loan. Lenders generally limit the maximum VA loan to $203,000. The U.S. Department of Veterans Affairs does not make loans, it guarantees loans made by lenders. VA determines your eligibility and, if you are qualified, VA will issue you a certificate of eligibility to be used in applying for a VA loan.
RHS Loan Programs
The Rural Housing Service (RHS) of the U.S. Dept. of Agriculture guarantees loans for rural residents with minimal closing costs and no downpayment. Visit our page RHS programs for details.
Ginnie Mae which is part of HUD guarantees securities backed by pools of mortgage loans insured by these three federal agencies - FHA, or VA, or RHS. Securities are sold through financial institutions that trade government securities.
State and Local Housing Programs
Many states, counties and cities provide low to moderate housing finance programs, down payment assistance programs, or programs tailored specifically for a first time buyer. These programs are typically more lenient on the qualification guidelines and often designed with lower upfront fees. Also, there are often loan assistance programs offered at the local or state level such as MCC (Mortgage Credit Certificate) which allows you a tax credit for part of your interest payment. Most of these programs are fixed rate mortgages and have interest rates lower than the current market.
Conforming Loans
Conventional loans may be conforming and non-conforming. Conforming loans have terms and conditions that follow the guidelines set forth by Fannie Mae and Freddie Mac. These two stockholder-owned corporations purchase mortgage loans complying with the guidelines from mortgage lending institutions, packages the mortgages into securities and sell the securities to investors. By doing so, Fannie Mae and Freddie Mac, like Ginnie Mae, provide a continuous flow of affordable funds for home financing that results in the availability of mortgage credit for Americans.
Fannie Mae and Freddie Mac guidelines establish the maximum loan amount, borrower credit and income requirements, down payment, and suitable properties. Fannie Mae and Freddie Mac announces new loan limits every year.
The Federal Housing Administration (FHA), which is part of the U.S. Dept. of Housing and Urban Development (HUD), administers various mortgage loan programs. FHA loans have lower down payment requirements and are easier to qualify than conventional loans. FHA loans cannot exceed the statutory limit. Go to FHA Programs page to get more information.
VA loans
VA loans are guaranteed by U.S. Dept. of Veterans Affairs. The guaranty allows veterans and service persons to obtain home loans with favorable loan terms, usually without a down payment. In addition, it is easier to qualify for a VA loan than a conventional loan. Lenders generally limit the maximum VA loan to $203,000. The U.S. Department of Veterans Affairs does not make loans, it guarantees loans made by lenders. VA determines your eligibility and, if you are qualified, VA will issue you a certificate of eligibility to be used in applying for a VA loan.
RHS Loan Programs
The Rural Housing Service (RHS) of the U.S. Dept. of Agriculture guarantees loans for rural residents with minimal closing costs and no downpayment. Visit our page RHS programs for details.
Ginnie Mae which is part of HUD guarantees securities backed by pools of mortgage loans insured by these three federal agencies - FHA, or VA, or RHS. Securities are sold through financial institutions that trade government securities.
State and Local Housing Programs
Many states, counties and cities provide low to moderate housing finance programs, down payment assistance programs, or programs tailored specifically for a first time buyer. These programs are typically more lenient on the qualification guidelines and often designed with lower upfront fees. Also, there are often loan assistance programs offered at the local or state level such as MCC (Mortgage Credit Certificate) which allows you a tax credit for part of your interest payment. Most of these programs are fixed rate mortgages and have interest rates lower than the current market.
Conforming Loans
Conventional loans may be conforming and non-conforming. Conforming loans have terms and conditions that follow the guidelines set forth by Fannie Mae and Freddie Mac. These two stockholder-owned corporations purchase mortgage loans complying with the guidelines from mortgage lending institutions, packages the mortgages into securities and sell the securities to investors. By doing so, Fannie Mae and Freddie Mac, like Ginnie Mae, provide a continuous flow of affordable funds for home financing that results in the availability of mortgage credit for Americans.
Fannie Mae and Freddie Mac guidelines establish the maximum loan amount, borrower credit and income requirements, down payment, and suitable properties. Fannie Mae and Freddie Mac announces new loan limits every year.
New York Home Equity Loans : New York Home Equity
New York Home Equity Loans
Do you have equity in your home? Then, why don't you borrow against it to get things at a good price? Why do you want New York home equity loans? Do you seek New York home equity financing to make improvements in your home? You may need finance for a series of repairs and upgrades. You may also go for home equity loan in order to consolidate your debts into a manageable monthly payment.
You might know that a New York home equity is a good way to finance big expenses like medical expenses, a new car, education expenses and college expenses. If you want to make use of the investment opportunities, you may seek the help of home equity mortgage loans in New York. Make sure of your needs before going for NY home equity loans.
So, you understand your needs but do you understand your qualifications? Remember that you will only get qualified for a New York home equity if you completely own your property and if your mortgage is fully repaid. Does the New York home equity financing fit with your income and budget? Consider that. Is your property dear to you? Then, it would be better for you to repay your home equity loan in New York. Remember that you have pledged your home as loan collateral. Your lender could make a claim to your home if you fail to repay your New York home equity mortgage.
Have you always wanted a low rate of interest? Everybody does. Then, you should certainly have a look at the New York home equity loans as they offers a low rate of interest. The interest rate is not only low but it is also tax deductible. Consult your tax advisor regarding tax deductibility. NY home equity loans are also amortized over about 15 years vs. about four years for credit cards.
Are home equity mortgage loans just good enough for large expenses? No, you may also use home equity loans for short-term expenses.
Do you have equity in your home? Then, why don't you borrow against it to get things at a good price? Why do you want New York home equity loans? Do you seek New York home equity financing to make improvements in your home? You may need finance for a series of repairs and upgrades. You may also go for home equity loan in order to consolidate your debts into a manageable monthly payment.
You might know that a New York home equity is a good way to finance big expenses like medical expenses, a new car, education expenses and college expenses. If you want to make use of the investment opportunities, you may seek the help of home equity mortgage loans in New York. Make sure of your needs before going for NY home equity loans.
So, you understand your needs but do you understand your qualifications? Remember that you will only get qualified for a New York home equity if you completely own your property and if your mortgage is fully repaid. Does the New York home equity financing fit with your income and budget? Consider that. Is your property dear to you? Then, it would be better for you to repay your home equity loan in New York. Remember that you have pledged your home as loan collateral. Your lender could make a claim to your home if you fail to repay your New York home equity mortgage.
Have you always wanted a low rate of interest? Everybody does. Then, you should certainly have a look at the New York home equity loans as they offers a low rate of interest. The interest rate is not only low but it is also tax deductible. Consult your tax advisor regarding tax deductibility. NY home equity loans are also amortized over about 15 years vs. about four years for credit cards.
Are home equity mortgage loans just good enough for large expenses? No, you may also use home equity loans for short-term expenses.
New York Interest Only Mortgage
New York Interest Only Mortgage
You know the traditional mortgages. They require you to pay some principal along with the interest. But, New York interest only mortgage is different. It do not require you to pay some principal amount in the early years of the loan. Since you have to pay back the principal after the time period, you may wonder if New York interest only mortgage is really useful.
New York interest only mortgage programs are certainly useful if you are the right person for it. How do you determine if you are the right person? What will you do if you come into some money? Would you invest it in the right place? If you are a disciplined investor, you may go ahead and try your luck in interest only mortgages in New York. Interest only home loans will leave you with some money in the initial years. So, you should invest the money for home improvements and college tuitions? Well, they are the standard examples but you may use it for anything.
Do you know that an average homeowner stays in his house between five and seven years? Are you so attached to your home that you are going to stay there your entire life? Then, you are not the right person for interest only mortgage. But, if are similar to the average homeowner, you may apply for an interest only home loan in New York.
Have lenders asked you questions about your financial stability? It is for a good purpose. Are you expecting a salary hike in the next few years? New York interest only mortgages are awaiting you. Your income is to remain the same for the next few years? Then, it would be difficult for you to take up an interest only mortgage loan in New York. You may also take up interest only mortgage loans if you have credit card debts.
New York interest only mortgage could either be fixed or adjustable rate mortgages. Do you know about the most popular interest only product in New York? It resembles the five-year adjustable rate mortgage where you have to pay only the interest for the first five years.
You know the traditional mortgages. They require you to pay some principal along with the interest. But, New York interest only mortgage is different. It do not require you to pay some principal amount in the early years of the loan. Since you have to pay back the principal after the time period, you may wonder if New York interest only mortgage is really useful.
New York interest only mortgage programs are certainly useful if you are the right person for it. How do you determine if you are the right person? What will you do if you come into some money? Would you invest it in the right place? If you are a disciplined investor, you may go ahead and try your luck in interest only mortgages in New York. Interest only home loans will leave you with some money in the initial years. So, you should invest the money for home improvements and college tuitions? Well, they are the standard examples but you may use it for anything.
Do you know that an average homeowner stays in his house between five and seven years? Are you so attached to your home that you are going to stay there your entire life? Then, you are not the right person for interest only mortgage. But, if are similar to the average homeowner, you may apply for an interest only home loan in New York.
Have lenders asked you questions about your financial stability? It is for a good purpose. Are you expecting a salary hike in the next few years? New York interest only mortgages are awaiting you. Your income is to remain the same for the next few years? Then, it would be difficult for you to take up an interest only mortgage loan in New York. You may also take up interest only mortgage loans if you have credit card debts.
New York interest only mortgage could either be fixed or adjustable rate mortgages. Do you know about the most popular interest only product in New York? It resembles the five-year adjustable rate mortgage where you have to pay only the interest for the first five years.
Friday, November 2, 2007
Equity Financing
Equity Financing
Most small or growth-stage businesses use limited equity financing. As with debt financing, additional equity often comes from non-professional investors such as friends, relatives, employees, customers, or industry colleagues. However, the most common source of professional equity funding comes from venture capitalists. These are institutional risk takers and may be groups of wealthy individuals, government-assisted sources, or major financial institutions. Most specialize in one or a few closely related industries. The high-tech industry of California's Silicon Valley is a well-known example of capitalist investing.Venture capitalists are often seen as deep-pocketed financial gurus looking for start-ups in which to invest their money, but they most often prefer three-to-five-year old companies with the potential to become major regional or national concerns and return higher-than-average profits to their shareholders. Venture capitalists may scrutinize thousands of potential investments annually, but only invest in a handful. The possibility of a public stock offering is critical to venture capitalists. Quality management, a competitive or innovative advantage, and industry growth are also major concerns.
Different venture capitalists have different approaches to management of the business in which they invest. They generally prefer to influence a business passively, but will react when a business does not perform as expected and may insist on changes in management or strategy. Relinquishing some of the decision-making and some of the potential for profits are the main disadvantages of equity financing.
You may contact these investors directly, although they typically make their investments through referrals. The SBA also licenses Small Business Investment Companies (SBICs) and Minority Enterprise Small Business Investment companies (MSBIs), which offer equity financing. Apple Computer, Federal Express and Nike Shoes received financing from SBICs at critical stages of their growth.
Most small or growth-stage businesses use limited equity financing. As with debt financing, additional equity often comes from non-professional investors such as friends, relatives, employees, customers, or industry colleagues. However, the most common source of professional equity funding comes from venture capitalists. These are institutional risk takers and may be groups of wealthy individuals, government-assisted sources, or major financial institutions. Most specialize in one or a few closely related industries. The high-tech industry of California's Silicon Valley is a well-known example of capitalist investing.Venture capitalists are often seen as deep-pocketed financial gurus looking for start-ups in which to invest their money, but they most often prefer three-to-five-year old companies with the potential to become major regional or national concerns and return higher-than-average profits to their shareholders. Venture capitalists may scrutinize thousands of potential investments annually, but only invest in a handful. The possibility of a public stock offering is critical to venture capitalists. Quality management, a competitive or innovative advantage, and industry growth are also major concerns.
Different venture capitalists have different approaches to management of the business in which they invest. They generally prefer to influence a business passively, but will react when a business does not perform as expected and may insist on changes in management or strategy. Relinquishing some of the decision-making and some of the potential for profits are the main disadvantages of equity financing.
You may contact these investors directly, although they typically make their investments through referrals. The SBA also licenses Small Business Investment Companies (SBICs) and Minority Enterprise Small Business Investment companies (MSBIs), which offer equity financing. Apple Computer, Federal Express and Nike Shoes received financing from SBICs at critical stages of their growth.
Financing Basics
Financing Basics
While poor management is cited most frequently as the reason businesses fail, inadequate or ill-timed financing is a close second. Whether you're starting a business or expanding one, sufficient ready capital is essential. But it is not enough to simply have sufficient financing; knowledge and planning are required to manage it well. These qualities ensure that entrepreneurs avoid common mistakes like securing the wrong type of financing, miscalculating the amount required, or underestimating the cost of borrowing money.Before inquiring about financing, ask yourself the following:
Do you need more capital or can you manage existing cash flow more effectively?
How do you define your need?
Do you need money to expand or as a cushion against risk?
How urgent is your need?
You can obtain the best terms when you anticipate your needs rather than looking for money under pressure.
How great are your risks?
All businessess carry risks, and the degree of risk will affect cost and available financing alternatives.
In what state of development is the business?
Needs are most critical during transitional stages.
For what purposes will the capital be used?
Any lender will require that capital be requested for very specific needs.
What is the state of your industry?
Depressed, stable, or growth conditions require different approaches to money needs and sources. Businesses that prosper while others are in decline will often receive better funding terms.
Is your business seasonal or cyclical?
Seasonal needs for financing generally are short term. Loans advanced for cyclical industries such as construction are designed to support a business through depressed periods.
How strong is your management team?
Management is the most important element assessed by money sources.
Perhaps most importantly, how does your need for financing mesh with your business plan? If you don't have a business plan, make writing one your first priority. All capital sources will want to see your for the start-up and growth of your business.
Personal vs. Business
Personal vs. Business
Starting up a business can be a tremendous strain on your personal finances. It can take six months or more before your new venture is profitable and can provide financial support for you and your family. Before going into business it is always wise to get your finances in order.Write a monthly household budget that accounts for your income and your household expenses. Be as conservative as possible, because it is vital to your success that you have the resources to maintain your household expenses while your business is growing. Any strain on your personal budget will put the financial success of your business at risk.It is also a good idea to check your personal credit situation. Too often, entrepreneurs think that their business credit and personal credit are separate. A business' credit is built upon the owner's personal credit. Because you have not established a business credit history, lenders and suppliers will use your personal credit history to determine your terms of credit.Your credit report determines how you will be perceived by potential lenders and suppliers. You should know what appears on your credit report because you may find errors that you will want to have corrected. To get a copy of your credit report, refer to one of the three major credit bureaus:
Equifax
Experian
Trans Union
For Additional Information:
What is Credit Scoring?
Fair Credit Reporting?
Federal Trade Commission Consumer Protection Fair Isaac FICO Scoring
Starting up a business can be a tremendous strain on your personal finances. It can take six months or more before your new venture is profitable and can provide financial support for you and your family. Before going into business it is always wise to get your finances in order.Write a monthly household budget that accounts for your income and your household expenses. Be as conservative as possible, because it is vital to your success that you have the resources to maintain your household expenses while your business is growing. Any strain on your personal budget will put the financial success of your business at risk.It is also a good idea to check your personal credit situation. Too often, entrepreneurs think that their business credit and personal credit are separate. A business' credit is built upon the owner's personal credit. Because you have not established a business credit history, lenders and suppliers will use your personal credit history to determine your terms of credit.Your credit report determines how you will be perceived by potential lenders and suppliers. You should know what appears on your credit report because you may find errors that you will want to have corrected. To get a copy of your credit report, refer to one of the three major credit bureaus:
Equifax
Experian
Trans Union
For Additional Information:
What is Credit Scoring?
Fair Credit Reporting?
Federal Trade Commission Consumer Protection Fair Isaac FICO Scoring
Micro-Loans
Micro-Loans
The Microloan Program provides very small loans to start-up, newly established, or growing small business concerns. Under this program, SBA makes funds available to nonprofit community based lenders (intermediaries) which, in turn, make loans to eligible borrowers in amounts up to a maximum of $35,000. The average loan size is about $13,000. Applications are submitted to the local intermediary and all credit decisions are made on the local level.Terms, Interest Rates, and Fees:
The maximum term allowed for a microloan is six years. However, loan terms vary according to the size of the loan, the planned use of funds, the requirements of the intermediary lender, and the needs of the small business borrower. The maximum loan amount is $35,000, however, the average loan amount is around $13,000. Interest rates vary, depending upon the intermediary lender and costs to the intermediary from the U.S. Treasury. Generally these rates will be between 8 eight percent and thirteen percent.Collateral
Each intermediary lender has its own lending and credit requirements. However, business owners contemplating application for a microloan should be aware that intermediaries will generally require some type of collateral, and the personal guarantee of the business owner.Technical Assistance
Each intermediary is required to provide business based training and technical assistance to its microborrowers. Individuals and small businesses applying for microloan financing may be required to fulfill training and/or planning requirements before a loan application is considered.
The Microloan Program provides very small loans to start-up, newly established, or growing small business concerns. Under this program, SBA makes funds available to nonprofit community based lenders (intermediaries) which, in turn, make loans to eligible borrowers in amounts up to a maximum of $35,000. The average loan size is about $13,000. Applications are submitted to the local intermediary and all credit decisions are made on the local level.Terms, Interest Rates, and Fees:
The maximum term allowed for a microloan is six years. However, loan terms vary according to the size of the loan, the planned use of funds, the requirements of the intermediary lender, and the needs of the small business borrower. The maximum loan amount is $35,000, however, the average loan amount is around $13,000. Interest rates vary, depending upon the intermediary lender and costs to the intermediary from the U.S. Treasury. Generally these rates will be between 8 eight percent and thirteen percent.Collateral
Each intermediary lender has its own lending and credit requirements. However, business owners contemplating application for a microloan should be aware that intermediaries will generally require some type of collateral, and the personal guarantee of the business owner.Technical Assistance
Each intermediary is required to provide business based training and technical assistance to its microborrowers. Individuals and small businesses applying for microloan financing may be required to fulfill training and/or planning requirements before a loan application is considered.
Prequalification Program
Prequalification Program
The Prequalification Loan program uses intermediary organizations to assist prospective borrowers in developing viable loan application packages and securing loans. This program targets low income borrowers, disabled business owners, new and emerging businesses, veterans, exporters, rural and specialized industries.The job of the intermediary is to work with the applicant to make sure the business plan is complete and that the application is both eligible and has credit merit. If the intermediary is satisfied that the application has a chance for approval, it will send it to the SBA for processing. To find out whether there is a pre-qualification intermediary operating in your area, contact your local SBA office. Note: Small Business Development Centers serving as intermediaries do not charge a fee for loan packaging. For-profit organizations will charge a fee.Once the loan package is assembled, it is submitted to the SBA for expedited consideration. SBA conducts a thorough analysis of the case, using the same time frame and degree of analysis that it then helps the borrower locate a lender offering the most competitive rates. The applicant then takes the letter and its application documents to a lender for a decision.uses when processing requests under the regular method of delivery process.If SBA decides the application is eligible and has sufficient credit merit to warrant approval, it will issue a commitment letter on behalf of the applicant. The commitment letter or pre-qualification letter, indicates SBA's willingness to guaranty a loan made by a lender under certain terms and conditions. The intermediary
The Prequalification Loan program uses intermediary organizations to assist prospective borrowers in developing viable loan application packages and securing loans. This program targets low income borrowers, disabled business owners, new and emerging businesses, veterans, exporters, rural and specialized industries.The job of the intermediary is to work with the applicant to make sure the business plan is complete and that the application is both eligible and has credit merit. If the intermediary is satisfied that the application has a chance for approval, it will send it to the SBA for processing. To find out whether there is a pre-qualification intermediary operating in your area, contact your local SBA office. Note: Small Business Development Centers serving as intermediaries do not charge a fee for loan packaging. For-profit organizations will charge a fee.Once the loan package is assembled, it is submitted to the SBA for expedited consideration. SBA conducts a thorough analysis of the case, using the same time frame and degree of analysis that it then helps the borrower locate a lender offering the most competitive rates. The applicant then takes the letter and its application documents to a lender for a decision.uses when processing requests under the regular method of delivery process.If SBA decides the application is eligible and has sufficient credit merit to warrant approval, it will issue a commitment letter on behalf of the applicant. The commitment letter or pre-qualification letter, indicates SBA's willingness to guaranty a loan made by a lender under certain terms and conditions. The intermediary
Basic Loan Program
7(a) loans are the most basic and most used type loan of SBA's business loan programs. Its name comes from section 7(a) of the Small Business Act, which authorizes the Agency to provide business loans to American small businesses.All 7(a) loans are provided by lenders who are called participants because they participate with SBA in the 7(a) program. Not all lenders choose to participate, but most American banks do. There are also some non-bank lenders who participate with SBA in the 7(a) program which expands the availability of lenders making loans under SBA guidelines.7(a) loans are only available on a guaranty basis. This means they are provided by lenders who choose to structure their own loans by SBA's requirements and who apply and receive a guaranty from SBA on a portion of this loan. The SBA does not fully guaranty 7(a) loans. The lender and SBA share the risk that a borrower will not be able to repay the loan in full. The guaranty is a guaranty against payment default. It does not cover imprudent decisions by the lender or misrepresentation by the borrower.Under the guaranty concept, commercial lenders make and administer the loans.The business applies to a lender for their financing. The lender decides if they will make the loan internally or if the application has some weaknesses which, in their opinion, will require an SBA guaranty if the loan is to be made. The guaranty which SBA provides is only available to the lender. It assures the lender that in the event the borrower does not repay their obligation and a payment default occurs, the Government will reimburse the lender for its loss, up to the percentage of SBA's guaranty. Under this program, the borrower remains obligated for the full amount due.All 7(a) loans which SBA guaranty must meet 7(a) criteria. The business gets a loan from its lender with a 7(a) structure and the lender gets an SBA guaranty on a portion or percentage of this loan. Hence the primary business loan assistance program available to small business from the SBA is called the 7(a) guaranty loan program.A key concept of the 7(a) guaranty loan program is that the loan actually comes from a commercial lender, not the Government. If the lender is not willing to provide the loan, even if they may be able to get an SBA guaranty, the Agency can not force the lender to change their mind. Neither can SBA make the loan by itself because the Agency does not have any money to lend. Therefore it is paramount that all applicants positively approach the lender for a loan, and that they know the lenders criteria and requirements as well as those of the SBA. In order to obtain positive consideration for an SBA supported loan, the applicant must be both eligible and creditworthy.What SBA Seeks In A Loan Application:
In order to get a 7(a) loan, the applicant must first be eligible. Repayment ability from the cash flow of the business is a primary consideration in the SBA loan decision process but good character, management capability, collateral, and owner's equity contribution are also important considerations. All owners of 20 percent or more are required to personally guarantee SBA loans.Eligibility Criteria:
All applicants must be eligible to be considered for a 7(a) loan. The eligibility requirements are designed to be as broad as possible in order that this lending program can accommodate the most diverse variety of small business financing needs. All businesses that are considered for financing under SBA’s 7(a) loan program must: meet SBA size standards, be for-profit, not already have the internal resources (business or personal) to provide the financing, and be able to demonstrate repayment. Certain variations of SBA’s 7(a) loan program may also require additional eligibility criteria. Special purpose programs will identify those additional criteria.Eligibility factors for all 7(a) loans include: size, type of business, use of proceeds, and the availability of funds from other sources. The following links will provide more detailed information on these eligibility issues.
In order to get a 7(a) loan, the applicant must first be eligible. Repayment ability from the cash flow of the business is a primary consideration in the SBA loan decision process but good character, management capability, collateral, and owner's equity contribution are also important considerations. All owners of 20 percent or more are required to personally guarantee SBA loans.Eligibility Criteria:
All applicants must be eligible to be considered for a 7(a) loan. The eligibility requirements are designed to be as broad as possible in order that this lending program can accommodate the most diverse variety of small business financing needs. All businesses that are considered for financing under SBA’s 7(a) loan program must: meet SBA size standards, be for-profit, not already have the internal resources (business or personal) to provide the financing, and be able to demonstrate repayment. Certain variations of SBA’s 7(a) loan program may also require additional eligibility criteria. Special purpose programs will identify those additional criteria.Eligibility factors for all 7(a) loans include: size, type of business, use of proceeds, and the availability of funds from other sources. The following links will provide more detailed information on these eligibility issues.
Thursday, November 1, 2007
Mortgage Calculators available
Mortgage Calculators available
Adjustable Rate Mortgage Calculator :
This calculator helps you to determine what your adjustable mortgage payments will be.
APR Calculator for Adjustable Rate Mortgages:
Use this calculator to find the APR on your adjustable rate mortgage.
ARM vs. Fixed Rate Mortgage :
Use this calculator to compare a fixed rate mortgage to two types of ARMs, a Fully Amortizing ARM and an Interest Only ARM.
Balloon Mortgages :
A balloon mortgage can be an excellent option for many home buyers, use this calculator to see if a balloon mortgage might fit your needs.
Bi-weekly Payment Calculator:
Using bi-weekly payments can accelerate your mortgage payoff and save you thousands in interest. Use this calculator to compare a typical monthly payment schedule to an accelerated bi-weekly payment.
Bi-weekly Payments for an Existing Mortgage:
This calculator shows you the possible savings by starting to pay your current mortgage with bi-weekly payments, instead of monthly payments.
Blended Rate Mortgage Calculator :
This calculator helps you determine the effective, or blended, interest rate you would pay if you use a first and a second mortgage to finance the purchase of a home.
Fixed Rate Mortgage vs. Interest Only Mortgage:
Use this calculator to compare a fixed rate mortgage to Interest Only Mortgage.
Fixed Rate Mortgage vs. LIBOR ARM :
Use this calculator to compare a fixed rate mortgage to a LIBOR ARM.
Interest Only ARM Calculator :
Interest only mortgages can provide you with very low monthly payments, however you are not paying off any principal during the interest only period.
Interest Only Mortgage Calculator :
Use this calculator to generate an amortization schedule for an interest only mortgage.
Maximum Mortgage :
Use this calculator to determine your maximum mortgage and how different interest rates affect your how much you can borrow.
Mortgage APR Calculator :
Use this calculator to find the APR on your mortgage.
Mortgage comparison: 15 years vs. 30 years
Use this calculator to compare these two mortgage terms, and let us help you decide which term is better for you.
Mortgage Debt Consolidation:
This calculator is designed to help determine whether using a mortgage to consolidate your debt is right for you.
Mortgage Loan Calculator :
Use this calculator to determine your monthly payment and amortization schedule.
Mortgage Loan Calculator (PITI) :
Use this calculator to determine your monthly mortgage principal, interest, taxes and insurance payment (PITI) and amortization schedule.
Mortgage Payoff :
Save thousands of dollars in interest by increasing your monthly mortgage payment.
Mortgage Points Calculator :
Should you buy points? Use this calculator to find out.
Mortgage Qualifier :
Can you buy your dream home? Find out just how much you can afford!
Mortgage Required Income :
Use this calculator to determine how much income you need to qualify for a mortgage and how different interest rates affect your required income.
Mortgage Tax Savings Calculator :
Interest and points paid for a home mortgage are tax deductible. Use this calculator to determine how much your mortgage could save you in income taxes.
Option ARM vs. Fixed Rate Mortgage :
Use this calculator see how a the minimum payment on an Option ARM Mortgage can save you money on your monthly mortgage payment.
Refinance Breakeven :
Should you refinance your mortgage? Use this calculator to determine when you will breakeven!
Refinance Interest Savings :
Use this calculator to see how much interest you can save by refinancing your mortgage!
Rent vs. Buy :
Are you better off buying your home, or should you continue to rent?
Adjustable Rate Mortgage Calculator :
This calculator helps you to determine what your adjustable mortgage payments will be.
APR Calculator for Adjustable Rate Mortgages:
Use this calculator to find the APR on your adjustable rate mortgage.
ARM vs. Fixed Rate Mortgage :
Use this calculator to compare a fixed rate mortgage to two types of ARMs, a Fully Amortizing ARM and an Interest Only ARM.
Balloon Mortgages :
A balloon mortgage can be an excellent option for many home buyers, use this calculator to see if a balloon mortgage might fit your needs.
Bi-weekly Payment Calculator:
Using bi-weekly payments can accelerate your mortgage payoff and save you thousands in interest. Use this calculator to compare a typical monthly payment schedule to an accelerated bi-weekly payment.
Bi-weekly Payments for an Existing Mortgage:
This calculator shows you the possible savings by starting to pay your current mortgage with bi-weekly payments, instead of monthly payments.
Blended Rate Mortgage Calculator :
This calculator helps you determine the effective, or blended, interest rate you would pay if you use a first and a second mortgage to finance the purchase of a home.
Fixed Rate Mortgage vs. Interest Only Mortgage:
Use this calculator to compare a fixed rate mortgage to Interest Only Mortgage.
Fixed Rate Mortgage vs. LIBOR ARM :
Use this calculator to compare a fixed rate mortgage to a LIBOR ARM.
Interest Only ARM Calculator :
Interest only mortgages can provide you with very low monthly payments, however you are not paying off any principal during the interest only period.
Interest Only Mortgage Calculator :
Use this calculator to generate an amortization schedule for an interest only mortgage.
Maximum Mortgage :
Use this calculator to determine your maximum mortgage and how different interest rates affect your how much you can borrow.
Mortgage APR Calculator :
Use this calculator to find the APR on your mortgage.
Mortgage comparison: 15 years vs. 30 years
Use this calculator to compare these two mortgage terms, and let us help you decide which term is better for you.
Mortgage Debt Consolidation:
This calculator is designed to help determine whether using a mortgage to consolidate your debt is right for you.
Mortgage Loan Calculator :
Use this calculator to determine your monthly payment and amortization schedule.
Mortgage Loan Calculator (PITI) :
Use this calculator to determine your monthly mortgage principal, interest, taxes and insurance payment (PITI) and amortization schedule.
Mortgage Payoff :
Save thousands of dollars in interest by increasing your monthly mortgage payment.
Mortgage Points Calculator :
Should you buy points? Use this calculator to find out.
Mortgage Qualifier :
Can you buy your dream home? Find out just how much you can afford!
Mortgage Required Income :
Use this calculator to determine how much income you need to qualify for a mortgage and how different interest rates affect your required income.
Mortgage Tax Savings Calculator :
Interest and points paid for a home mortgage are tax deductible. Use this calculator to determine how much your mortgage could save you in income taxes.
Option ARM vs. Fixed Rate Mortgage :
Use this calculator see how a the minimum payment on an Option ARM Mortgage can save you money on your monthly mortgage payment.
Refinance Breakeven :
Should you refinance your mortgage? Use this calculator to determine when you will breakeven!
Refinance Interest Savings :
Use this calculator to see how much interest you can save by refinancing your mortgage!
Rent vs. Buy :
Are you better off buying your home, or should you continue to rent?
Investment Loan
Definitions
Loan amount
This is the total loan amount you are planning on taking out. This amount is also used as the initial value of the appreciable asset or investment that you are making.
Loan term in years
The number of years you wish to analyze for this loan. This can be any number from one to 30 years.
Loan interest rate
The annual interest rate you are charged for this loan. This calculator assumes that your payments are made monthly and that interest is compounded monthly.
Investment rate of return
This is the annually compounded rate of return you expect from your investments. For the purposes of this calculator, taxation is not factored into the results. If you pay taxes on the interest, dividends or capital gains from these investments you may wish to enter your after tax rate of return.
The actual rate of return is largely dependant on the type of investments you select. From January 1970 to December 2006, the average compounded rate of return for the S&P 500, including reinvestment of dividends, was approximately 11.5% per year (source: www.standardandpoors.com). During this period, the highest 12-month return was 61%, and the lowest was -39%. Savings accounts at a bank pay as little as 1% or less.
It is important to remember that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect additional sales charges and fees that funds may charge.
Percent reinvested
This is the percentage of the return generated by your investment that is reinvested. For example, if your investment generates $1,000 per month and you reinvest 50% you will the value of your investment will increase by $500.
Loan amount
This is the total loan amount you are planning on taking out. This amount is also used as the initial value of the appreciable asset or investment that you are making.
Loan term in years
The number of years you wish to analyze for this loan. This can be any number from one to 30 years.
Loan interest rate
The annual interest rate you are charged for this loan. This calculator assumes that your payments are made monthly and that interest is compounded monthly.
Investment rate of return
This is the annually compounded rate of return you expect from your investments. For the purposes of this calculator, taxation is not factored into the results. If you pay taxes on the interest, dividends or capital gains from these investments you may wish to enter your after tax rate of return.
The actual rate of return is largely dependant on the type of investments you select. From January 1970 to December 2006, the average compounded rate of return for the S&P 500, including reinvestment of dividends, was approximately 11.5% per year (source: www.standardandpoors.com). During this period, the highest 12-month return was 61%, and the lowest was -39%. Savings accounts at a bank pay as little as 1% or less.
It is important to remember that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect additional sales charges and fees that funds may charge.
Percent reinvested
This is the percentage of the return generated by your investment that is reinvested. For example, if your investment generates $1,000 per month and you reinvest 50% you will the value of your investment will increase by $500.
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