Self-Directed IRA & Small Business Financing Blog

We are excited to announce that Guidant has added more services to its small business and franchise financing business unit.

Introducing: Unsecured Credit for Start-Up (and Existing) Businesses

The programs allows us to obtain up to $150,000 for small business or franchise start-up capital. The initial rates will range 0-8% and the amortization will range between 10-20yrs with NO penalty early pay-off. In my opinion, this makes our program even more attractive than the SBA when it comes to debt financing. The financing will be taken out in the name of the new business so that it doesn’t show up on your personal income statement/balance sheet. It makes it a great funding option for down-payments and so on! The type of financing is based on the individuals personal financials but is primarily credit driven.

WHO QUALIFIES?

• Have a credit score (FICO) of 700or higher.
• Have their average credit utilization under 50%.
• Home ownership is a plus – but not required.

In addition, the more household income you have, the better.

It is essential to understand that this program is a process. Just as you cannot develop an 800 credit score overnight, a business’s credit must also be “developed”. With a strategic plan it is possible to obtain an 80 Paydex (800 FICO equivalent) credit rating for your company within just one year. But waiting a year to get working capital just isn’t practical. We address this immediate need with working capital credit lines and use the business owner’s credit to jump start the process. The goal of the program is to meet your funding needs today and help you prepare for the future. The path to these results can only be achieved by following a systematic, planned design. That process is summarized as follows:

Week 1: Credit Analysis – our team provides a comprehensive review of your credit file in order to qualify whether or not we can provide a guarantee. We also determine if there is any “window dressing” that would enhance the appeal to commercial bank underwriters. Our credit analysis ensures that our clients will get the most approvals at the highest limits with the best terms possible.

Weeks 2-3: Initial Applications – our applications result in lines that DO NOT APPEAR on your personal credit. Many lines are at 0% for the first year, allowing for a revenue ramp up period from the new capital investment(s). The applications are stated income and your business is not required to furnish financials for the applicants.

Week 4: Bank and Supply Lines Applications – bank line applications are submitted after the initial applications. These are reserved for businesses that have been operating for at least 6 months. New start-ups will have bank line applications submitted 6 months from business card applications. Most supply lines are not personally guaranteed, therefore these accounts report much more aggressively to business credit reporting agencies. Vendor accounts are actually more important in developing the company’s credit rating.

The initial capital should be funded by this time assuming the client is working with our lending partners in a timely fashion. As part of their original consulting agreement with us, the program will continue as follows to enable the franchisee to establish business credit that is substantial enough to get “take-out” financing 12-18 months down the road:

Weeks 3 – 24: Credit Liquidation and Utilization Consultation – our lenders consult with client on how to strategically liquidate credit lines to minimize fees and interest. Our target is to find capital at 0% for 12-15 months. We will consult client on how to strategically utilize cash and supply lines in order to maximize business credit rating and minimize interest while systematically requesting credit line increases. The goal is to double the limits within one year.

Weeks 5 -24: Dunn and Bradstreet DUNS number application / Paydex acquisition - an application for a DUNS number is filed with Dunn and Bradstreet. With the appropriate combination of trade lines and seasoning of the business credit profile the scoring models can then assign a rating. If this program was followed faithfully and payments made on accounts as agreed a Paydex score of 80 or higher can be achieved within 6-12 months. Once the 80 Paydex score is obtained your business will be offered additional unsolicited, PREAPPROVED credit offers.

This is the ultimate goal: continuous credit offers made by banks on the best terms. The business will no longer need to seek credit…. banks will find them!

The fee that our company will require for our services allows us to impart our knowledge and insulate your business from potential pitfalls. The cost of errors in credit development can be disastrous and when time is money - very expensive. Guidant’s team eliminates all of the guess work and presents a winning strategy in the mysterious world of business credit development. In addition, we believe this will help fill the void left by the SBA in funding deals under $150,000!

Guidant Financial Group is the leading provider of Self-Directed IRAs and helps thousands of people use their retirement funds to make investments outside of the stock market each year.

Join us for a special webinar as Rik Croasdale, a recognized expert on self-directed IRAs, will be sharing:

The webinar will happen on Thursday, Mar 19, 2009 from 10:00 AM - 11:00 AM PDT (PST).

You can CLICK HERE TO REGISTER.

Many individuals come to Guidant because our self-directed IRA LLC allows account holders to gain checkbook control over their retirement funds...making foreclosures a possibility. Last we knew, IOU's weren't acceptable forms of payment at a foreclosure auction.

We blogged about the markets reaching a 6-year low on February 19th.

We then blogged about how the market reached a 12-year low yesterday.

Could we be blogging about an 18-year low next week? Maybe.

Our thought? Sure. Now may be a great time to buy stocks. It also may be a great time to buy real estate, tax liens or even to originate private loans. Unfortunately, if you don't have a self-directed IRA, you might not have so many options to diversify.

Self-directed IRA investors often call Guidant in hopes of gaining insight into where our clients are investing their retirement dollars. While we cannot discuss the particulars of client transactions or recommend any specific investments, we can share we have seen a rising interest (again) in domestic real estate – primarily rental properties.

Recently, we have heard many that see opportunity because of tighter credit markets. It is harder to get qualified for loans than just six months ago and because there are fewer buyers, more inventory sitting on the market. More inventory means that sellers are more likely to negotiate – making this a buyers (or investors!) market. Today, many investors feel they can buy real estate at lower prices and charge a premium to rent the same place.

You may consider diversifying some of your retirement assets in to different markets and different assets. The beauty of self-directed IRAs is that you get to make that choice.