Finding practical ways to increase business’s capital is one of the main concerns for most business owners. Usually, this means going to a commercial broker to secure a loan. However, another highly viable method is to turn assets into cash, like property. And if you do, then capital gains tax needs to be considered.
Long-term loans have their uses. However, it is hard to ignore the potential that property of genuine value might have. This is especially true when that property is unused or is being poorly used. Hence, if you want to downsize your business, then selling off a poorly performing retail store and moving to a better location may be the best move. Whatever the reason, it is important that capital gains tax is kept in mind.
Applying for a small business loan can be a stressful undertaking. All too often, applicants have a negative attitude caused by different stories that relate disappointment and frustration to the experience. But being one of Australia’s links to leading commercial loan brokers, we at CommercialLoans.com.au know that these dark clouds are not quite as dark as the taletellers would have you believe.
It’s true that there are some challenges in securing necessary funding. However, the idea that a small business loan is next to impossible to get is far off the mark. In fact, according to the Australian Bankers’ Association, 89% of small businesses said that they did not see access to finance or the capacity to finance further growth in their business as an issue. There are other sources too, like the expert commercial lending brokers and independent lending institutions that are around to help.
Credit score is one of the most significant figures in your financial life. It is a three-digit number generated by an algorithm using a variety of information in your credit report. Banks use credit score as a means to predict risk, measuring a client’s likelihood to become delinquent on credit obligations in the coming months after scoring.
Different banks use different credit-scoring models, with the FICO credit score being the most popular. A higher number indicates lower risk, helping you gain a higher chance of approval. Some of the factors used in determining a business credit profile include credit history, available credit, and how often you pay bills.
If you are seeking for a commercial loan, it may be useful to understand how banks set commercial interest rates, which plays a big role in determining what your payment scheme will be, and the total amount you will have paid when you have settled everything. Let’s look at how commercial loan rates are set by the banks.
When you first look at the banks’ system of determining the rates, it might appear very simple. The bank earns a profit that comes from the difference of the money that is paid to them in interest on loans and the interest that they pay customers who deposit money into the bank.