Business Credit

Private Money


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Private money financing includes equity investors, private financing and Crowd funding.  Contribute money in exchange for a percentage of equity or ownership, in your company.  Thank Shark Tank, percentage of ownership based on risk, typically 20 – 60% is viable option for startups as no tax returns are typically required, the “idea” might be enough to attract an investor.  Investor will want to see value, such as a product with patents.  In many cases they would prefer to see a tested and proven concept over just an idea.

Private money often serves as SBA fall-out financing for loans that are close, but can’t qualify for SBA.  Collateral is required, although often only 10 – 30%.  Tax returns are required for two years, so no startups.  An Executive Summary is required.  Lenders are looking for average credit of 650+.  Loans can be in the millions, even billions of dollars.  Loan times take 30 – 90 days to close and receive funds.  Interest rates are usually 7%+ depending on risk