You know the story: Small time entrepreneur starts a company in his garage and almost overnight the company takes on the stock market into an industry dominated. OK, so this is the exception and not the rule. Most small business owners probably have different motivations for the creation of their company, but the majority of wealth is also likely to be one of the reasons for it. However, most small businesses are missing a great opportunity to use their stores to their personal growthWealth outside of their normal business.
The owner of a small business is to keep running normally on the day to day activities or grow his business: sales, accounting, collections, inventory, etc. Some have aspirations to be rich, but most settle into the daily routine, focus, lack of Focus is really needed to develop prosperity.
However, these average entrepreneur can start on the path to true wealth building that goestheir businesses, but also creates this wealth because of the economy, not make the transactions. In fact, the creation of wealth can be put on autopilot and get the transformation of a normal business expense into a powerful tool. This amazing opportunity is better achieved through the purchase of one or more objects using revenue funding only for the small business owner.
The theory is simple: The acquired business property is first used to house the business,But it should also consider the possibility of business, third-party earn rental income. As part of an estate plan to acquire the use of the business and a portfolio of income properties is overlooked some, but effective means of generating income in retirement that is guaranteed against serious inflation.
First, a business owner has to decide whether it is better to own than rent for business use. In a later section, I discuss the "Lease vs.Own choice, but for now I have to believe that an entrepreneur wants to buy property a program that will focus complementary to follow his personal wealth. Let me give you some background information before it in each step of the strategy.
There are three types of third party financing, which may be in the acquisition of property for small businesses or used. These are: Small Business Administration (SBA) in the amount of programs, conventional real estate financing and conventional smallCorporate finance.
The SBA programs for businesses in two versions: 7a (http://www.sba.gov/services/financialassistance/sbaloantopics/7a/index.html) and 504 (http://www.sba.gov/services / financialassistance/sbaloantopics/cdc504/index.html). If you require an extensive knowledge of the individual, the SBA offers, then click on the links above. In summary, it must be, here are the programs:
THE 7A
This is the SBA's flagship loan and is used for almost any company:Inventory, equipment, real estate, etc. It helps qualified small businesses obtain financing when they might not be eligible for business loans through normal lending channels. It is also the Agency's most flexible business loan program, since financing under this program can be guaranteed for a variety of general business purposes.
Loan must be used for most sound business purposes including working capital, machinery and equipment, furniture and fixtures, land and buildings(including purchase, renovation and new construction),), leasehold improvements and debt restructuring (under special conditions. Loan maturity is up to 10 years for working capital and generally up to 25 years for fixed assets.
The 504
The second option provided by the SBA is the "504" program. This program offers long-term, fixed-rate financing for small businesses of real estate or machinery or equipment for expansion or modernization of purchase. A 504-project is a "two loans"Program, which constitutes a first lien from a private lender to and a second lien from a Certified Development Corporation (CDC) are secured. The second lien is funded by a 100 percent SBA-guaranteed bonds. The two loans typically combine to deliver purchased as much as 90% of the cost of real estate by a small business owner, and the remaining 10 percent equity from the borrower. The program helps to expand small businesses and subject to working capital.
For a recentPress release from the SBA on the popularity and use of the two programs can be found here:
http://www.sba.gov/idc/groups/public/documents/sba_homepage/sba_news_07-71.pdf
In the next article I will cover other financing alternatives for small businesses and then begin to develop, the Wealth Building proposition for small businesses.
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