Sources  •  Specialties  •  Types  •  Other Sources  •  Costs  •  LTV/C  •  Duration  •  Buying Businesses  •  Submittal Requirements  •  More  •  Contact Prosper Systems  Home  •  Resume  •  Brief (Refer and Participate)  •  Group (Join)  •  Blog (Follow by eMail)  •  Development & Finance (CCCC)  •  Buying/Selling (Large Projects/Assets)  •  FREE Overview REVIEW  •  Project Services  •  Referral Income (to 20%)  •  PS Introduction (for referrals)  •  Schedule a Call (with Video options)  •  Contact Us Finance Options - Debt and Equity FREE Informational LIST

"We Consult on ALL these options, and Structure, help Prepare then Deliver to the BEST Financial Resources."
(We usually share points and fees with DEBT providers.)  LUCRATIVE REFERRAL PROGRAM.

Start with our COMPLIMENTARY Overview Review

  Sources

• Conventional Banks
• Government (SBA, HUD)
• Community Banks
• Credit Unions
• Non-Bank Lenders
• Alternative Lenders
• Bridge Lenders
• Local Family Offices
• Insurance Companies
• Pension Funds
• Incubators
• Community Collaboratives
• High-Net-Worth / Private Individuals

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Specialties

• Cash Flow Lenders
• Equipment Lenders
• Vehicle Lenders
• Real Estate Lenders

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Types

• Conventional (50%-80% Loan to Value, LTV - or Cost, LTC)

• Small Business Administration (SBA - up to 90% LTV or LTC on Commercial Real Estate or general business development; good interest rates; waiving fees and first $9,000 in payments through Sepember 2021).

• EMERGENCY LOANS and GRANTS available - see Emergency FINANCE Options page for DETAILS

• Housing and Urban Development / Federal Housing Authority (HUD/FHA insured - multifamily - health care, elderly, special needs - several, complex programs)

• Second (remaining 10%-35% LTV or LTC; higher interest rate; though most CRE lenders don't like to or are not allowed to take or work with a second position)

• Using Investment Capital for the 10%-30% loan down payments, optimizes your profit perspective - Contact Us for the most-lucrative solutions

• NEW:  Factoring Invoices / AR & Payroll Financing (up to 97%, as an Operating Expense vs Debt)

• Lines of Credit
  • Revolving Seconds on home or assets; higher interest rate than fixed
  • Under $30K; community banks and credit unions; unsecured, no/low documentation; higher interest rate after promo period
  • Under $300K; services available to float one application to several lenders; some focus on those using the same higher credit bureau reducing inquiry hits; about 10% fee from proceeds; higher interest rate after promo period
  • Note: 0%-interest promotional credit cards are available - but may accrue interest - and normally charge double-digit interest on balance after 0% term
  
  
• Participation (discounted equity purchases after completely paid off)

• Mezzanine (lender can convert to an equity interest in case of default, subordinate to senior lenders; higher interest rate)

• Convertible Note (considered an equity play)

• Syndicated Loan (combines sources to reduce risk,or for very large loans)

• Hard Money (based on asset value versus individual credit score; short term; higher interest rate)

• CrowdFinance (many, often small, contributors, generally through an online portal)
  • Debt or Equity - equity portals require SEC registration
  • Donation or pre-purchase of products or services
  
  
• Contact Us for creative combinations to accomplish 100% financing

"We Consult on ALL these options, and Structure, help Prepare then Deliver to the BEST Financial Resources."
(We usually share points and fees with DEBT providers.)  LUCRATIVE REFERRAL PROGRAM.

Start with our COMPLIMENTARY Overview Review

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Other Sources

• Suppliers (who profit from your existence or growth)

• Customers
• Give a discount for a year for upfront cash
• Commit to a subscription model for a year
• Government contract with big payment up front


• Grants (Government, Veteran Benefit, Non-Profit, ...)

• Sponsorships (for sponsors' exposure on buildings/vehicles/marketing/websites, at events, ...)

• Government Programs that fit into local/national leadership agendas

• Owner Carry
  • Seller finances the Buyer
  • 1-2 years to launch project or business
  • Longer if mutually beneficial
  • The note can be sold for the lump sum Seller may need or prefer
  
  
• Loan Assumptions

• Public Offerings - Initial and Subsequent

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Costs - approximate

• Interest
• 3% - 12%
• Up to 15% for "hard-money" and high-risk loans
• Possible adjustment proportional to the Loan-to-Value (LTV) Ratio and Duration


• Fees - not all levied
• Initiation/Consulting - 2-6%, minimum $2000
• Origination - 1-3%
• Bank Participation (SBA) - 0.5%
• Total - 0-6%
• Obtain estimate as early as possible
• Possible negotiation based on volume and intermediaries


• Pass-Throughs
• Business Credit Report
• Verifications
• Appraisals
• Survey
• Title
• Recording
• Inspection
• Travel
• Permits
• Legal - 0.05%, minimum $2000
• Negotiated Code/Habitability Maintenance


• At Closing
• Down Payment
• Property Taxes
• Prorated Interest
• Liens
• Balance of Current Loan(s)

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Loan-to-Value (LTV) and Loan-to-Cost (LTC) - approximate

• Normal
• 50% - 80%
• Based on current or after-updated / repair / rehab value


• Government
• Up to 90%
• SBA, HUD/FHA


• Refinance
• Up to 100%
• Conventional, Private, Government

  Duration

• Asset-only, 1-2 years

• 5-25 years, though may amortize for longer

  Buying Businesses

• Set up Lenders in advance based on the collateral to be acquired

• Be their salesman or consultant for equity and subsistence compensation until you own the company
• Start implementing your growth policies in advance
• You'll also learn quickly if you want the company


• Other options
• Owner Carry
• Profit Participation


• Build relationship so Seller wants you at the helm, not an impersonal Buyer from a different region or culture

• Preparation
  • Coordinate clearly with key employees
  • Seller could finance equipment, real estate, cash-flow, etc to maximum - loans assumed on purchase
  
  

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Submittal Requirements - not all requested by each Source - We Sequence, Streamline and Optimize Applications

• Project
  • Name
  • Description (one paragraph, include remainder)
    –––––– optionals follow ––––––
  • Location
  • Govt Approvals (permits, planning commission, etc)
  • Franchise (disclosure documents)
  
  
• Request
  • Purpose (acquisition - full/partial, refinance, cash out; asset, business)
  • Amount (us$)
  • Down Payment (us$, max)
  • APR (maximum; fixed or floating)
  • Owner carry (% range; agreement)
    –––––– optionals follow ––––––
  • Term (years)
  • Use of Funds (RE, construction costs, equipment, cash out etc; schedule, by year)
  
  
• Business Documents (attachment or online link)
  • Overview ("Brief"/"Teaser;" condensed Executive Summary) Reviewed, No Charge/Obligation
    –––––– optionals follow ––––––
  • Executive Summary (condensed Business Plan)
  • Pitch Deck (PPT or PDF with video or script; 10 slides of Executive Summary, to be presented in 20 minutes, in 30-point type)
  • Business Plan
  • Private Placement Memorandum (for Equity only, based on Business Plan)
  
  
• Financials (entry, attachment or online link)
  • Profit and Loss statement (2021 YTD; if 2020 tax returns not filed, 2020 P&L)
  • Balance Sheet (<90 days old)
  • Debt Schedule (business; current)
  • Financial Projections (3-10 years)
    –––––– optionals follow ––––––
  • Sales Tax Rates (if any sales income)
  • Tenant financial statements (single-tenant properties)
  • Invested to date (us$M)
  • Planning to invest in future (us$M)
  • Income (last 2-3 years; business and personal with 20%+ interest)
  • Tax Returns (last 2-3 years; business and personal with 20%+ interest)
  • Operating statements (3 years)
  
  
• Sponsor (duplicate for each individual or entity with 20%+ interest)
  • Full Name
  • Credit Rating (personal/business; source; actual/estimate)
  • Bio / Resume (for new ventures)
  • Industry background (properties/businesses owned/managed, etc.)
    –––––– optionals follow ––––––
  • Foreclosures, bankruptcies, criminal issues (explanation)
  • Net Worth (us$M)
  • Liquidity (% immediately available)
  • Proof of Funds (for transaction costs, down payment; statement)
  • Passport
  • Accept recourse (full or partial)

  We Sequence, Streamline and Optimize Applications

• Collateral (duplicate for each; make entry, attachment or online link)
  • Type (RE, vehicle, equipment, patent, precious metals, gems)
  • Address (include county)
  • Estimated value (source; appraisal)
  • Year (built, last renovated)
  • Size (square feet/units)
    –––––– optionals follow ––––––
  • Purchase price
  • Date of purchase
  • Mortgage/Lien balances (statements and amortization schedules)
  • Seasoning complete (if not, date)
  • Pictures (number to sequence)
  • Insurance policies (fire, theft, flood, loss, liability, etc)
  • Other information (enhance value, clarifications)
  
  
• Real Estate Collateral (personal, commercial)
  • New Purchase (LOI, Agreement, Contract)
  • Owner occupied (%)
  • Tenants (individuals, business & type, government subsidized, etc)
  • Rent Roll (if tenant occupied; include extension/termination options, rent steps)
  • Annual Income (rents, vending, etc)
  • Expenses (taxes, insurance, maintenance, utilities, management, etc)
    –––––– optionals follow ––––––
  • Historical occupancy (3 years)
  • Historical sales per square foot (retail properties, 3 years)
  • Annual NOI (Annual Income less Expenses)
  
  
• Startups (if in business for less than 12 months; special category and documentation requirements)
  • Business Type (real estate, technology, product, etc)
  • Business Documents (see Documentation above)
  • Location (virtual, home, office, facility; base address)
  • Initial Funding (LOCs, credit cards, 2nd mortgages, F&F, suppliers, customers, associates, notes, seed, etc)
  • Legal Structure (sole, partnership, LLC, Sub-S, C-Corp, non-profit)
  • Trade Name
  • Govt Approvals (zoning, permits/registrations/licenses)
  • Patents (submitted, approved)
    –––––– optionals follow ––––––
  • Initial Costs (inventory, deposits, equipment, real estate, office setup, accounting, hiring, etc)
  • Business Costs (space, marketing, total payroll, prof services, insurances, vehicle, maintenances, travel, etc)
  • Payroll Registrations (W-2, 1099, work comp, disability; local, state, fed)
  • Payroll Compliance (employees, independent contractors)
  • Insurances (officers, fire, vehicle, liability, etc)
  • Accounting System (method, software)
  • Tax Identification
  • Personal Income Requirements (years 1, 2, 3-5)
  • Professionals (attorney, accountant, bookkeeper, consultants)
  • Groups (LinkedIn, Facebook, Meetup, clubs, chambers)

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More

• Investopedia.com - CRE Loans

• Customer-Funded Business

• Debt-Lender Ranges

• Equity-Funder Ranges

• Additions / Suggestions appreciated

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PROSPER SYSTEMS, LLC (.biz)  •  Kenton H Johnson (.com), Founding Member  •  COMPLIMENTARY Overview Review

LUCRATIVE REFERRAL PROGRAM

PS INTRODUCTION (for Info and Referrals)