Commercial Finance – Hard Money

The Merriam – Webster Online Dictionary defines hard as:

1 a: not easily penetrated: not easily yielding to pressure b of cheese: not capable of being spread: very firm.

2 a: of liquor (1): having a harsh or acid taste (2): strongly alcoholic b: characterized by the presence of salts (as of calcium or magnesium) that prevents lathering with soap i.e.hard water.

3 a: of or relating to radiation of relatively high penetrating power: having high energy hard X rays b: having or producing relatively great photographic contrast i.e.a hard negative.

4 a: metallic as distinct from paper hard money b: of currency: convertible into gold: stable in value c: usable as currency i.e.paid in hard cash. d: of currency: readily acceptable in international trade e: being high and firm i.e. hard prices.

5 a: firmly and closely twisted i.e. hard yarns. b: having a smooth close napless finish i.e. a hard worsted.

6 a: physically fit i.e. in good hard condition. b: resistant to stress or disease c: free of weakness or defects.

7 a (1): firm definite i.e.reached a hard agreement. (2): not speculative or conjectural: factual hard evidence (3): important or informative rather than sensational or entertaining i.e. hard news. b: close searching i.e. gave a hard look. c: free from sentimentality or illusion: realistic i.e. good hard sense. d: lacking in responsiveness: obdurate unfeeling i.e. a hard heart.

8 a (1): difficult to bear or endure i.e.hard luck or hard times. (2): oppressive inequitable i.e.sales taxes are hard on the poor.

9 a: characterized by sharp or harsh outline, rigid execution, and stiff drawing b: sharply defined: stark i.e. hard shadows.

10 a (1): difficult to accomplish or resolve: troublesome i.e. hard problems.

As used in this article, hard money is intended to convey the idea that because of the current economic conditions, many financing needs will be more difficult to accomplish. They will require great exertion and effort to overcome the economic obstacles of the current economy. Compared to 2006 and 2007, periods of relatively easy money, to obtain financing today you will have to have firm, definite facts to support your financing needs. And the cost of money will be more difficult to bear. Hard money is harder to find, harder to obtain and harder to repay. Nevertheless, hard money may be an economic necessity as a means to an end to grow a business or complete a real estate transaction.

Why is 2008 a time of hard money? This is a difficult question to answer. If you ask 3 experts you probably will get three different answers. It may be the economic equivalent of The Perfect Storm- a True Story of Men against the Sea. The phrase “perfect storm” refers to the simultaneous occurrence of events which, taken individually, probably would be far less powerful than the result of their rare combination. These occurrences are rare by their very nature, so that even a slight change in any one event contributing to the perfect storm would lessen its overall impact. The stock market crash of 1929 and following depression exemplifies a perfect storm of economic consequence.

What are these events today? 1) The Mortgage Melt-down. Major financial institutions in the United States are incurring billions of dollars in losses due to the loss in valuation of their investments in mortgage securities. The consequence for borrowers is that these institutions are less inclined to take risks when loaning money for fear of additional losses. And their regulators are demanding that regulated lenders raise their credit standards for borrowers to qualify for a loan. 2) The devaluation of the American dollar versus other world currencies. The U.S. government is spending ginormous amounts of money in excess of what it collect in revenue due to the political compulsion to spend taxpayers’ money, the war in Iraq, Hurricane Katrina (and other natural disasters) and the war on terrorism. This makes our currency less valuable. It makes importing to the U.S. more expensive. The American people have less money to spend on goods and services, and their money buys less than it did a year ago because prices of necessities such as gasoline are higher. 3) The current tendency of Federal and State governments to reduce funding for social services, health services and education because of inadequate revenues; this hurts individuals and businesses who have less money to spend on products and services which creates additional drags on our economy. 4) The diminishing value of residential real estate all across the United States. This is related to the mortgage meltdown and the fact that many people incurred debts that they cannot repay. The real causes of these events are complicated and beyond the scope of this article. Suffice it to say that these are hard times and hard times create needs for hard money loans.

What exactly is hard money? Here are seven examples:

1) A commercial real estate loan where the borrower receives funds based on the value of the property, usually 50% or less, at an interest rate higher than a bank would charge. This is the most commonly understood type of hard money. In this financing, neither the income from the property or the borrower demonstrably supports the repayment of the loan.

2) A real estate loan to buy a residential property where the borrower cannot prove their income. This may be accomplished with financing from a seller, the only party willing to take the risk of non-payment.

3) A small junior lien on income producing commercial real estate where the first lien is very large. For example, a million dollar second lien behind a ten million dollar first lien. Most lenders simply do not want to consider a loan of this type because of the potential liability for repayment of the first lien. It is ten times the risk of the secondary loan.

4) Most loans to people with less than excellent credit. Many loans are based on credit scoring. If you do not have a credit score that is high enough for the lender’s requirement, you simply do not get their loan and you may or may not be able to find a hard money loan to accomplish your objective.

5) Accounts receivable financing to construction contractors, medical providers and sellers of agricultural products. Most factors do not offer to these sectors of the economy because of the risks and complexities that are involved.

6) Purchase order financing for items with gross margins less than twenty percent. The twenty percent margin is a benchmark for sufficient profitability in a transaction to pay all financing costs and create profits for the business after all costs are paid. During hard economic times margins are squeezed. It is a vicious cycle.

7) Loans to businesses that are particularly negatively affected by the current economy. For instance, a loan to build a new lumberyard is impacted by the downturn in new real estate construction and a lower need for lumber. Most banks would simply decline to consider such a loan. The same is true for developers seeking to build new housing tracts or office building developments. This is not a good time to try to start a new mortgage brokerage company; although it may be a good time to be a hard money lender provided that you are very, very careful in assessing your transactional risks.

What do all of these situations have in common? In times of easy money these situations would be less costly to finance and more likely to receive funding. Today, the lender’s answer to your request for funding is more likely to be a polite but strong “no way”. Many lenders have effectively (if not actually) shut their doors. Many lenders will simply decline to lend on hotels/motels, gas stations, owner/user properties, properties with any environmental issues. Borrowers who do not have FICO credit scores above 680, with substantial net worth and income will find it is very difficult to obtain many types of loans. Fortunately, the door for accounts receivable financing is still wide open.

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Commercial Finance – The Mortgage Meltdown

Banks lend money to people and businesses. The money is used for investment purposes and consumer purchases like food, cars and houses. When these investments are productive the money eventually finds its way back to the bank and an overall liquidity of a well functioning economy is created. The money cycles round and round when the economy is functioning effectively.

When the market is disrupted financial markets tend to seize up. The liquidity cycle may slow, freeze up to a degree or stop completely. This is true because banks are highly leveraged. A well capitalized bank is only required to have 6% of their assets in core capital. It is estimated that the residential mortgage meltdown will cause credit losses of about $400 billion dollars. This credit loss is about 2% of all U.S. equities. This hurts the bank’s balance sheets because it impacts their 6% core capital. To compensate, banks have to charge more for loans, pay less for deposits and create higher standards for borrowers which leads to less lending.

Why did this happen? Once upon a time after the great depression of the 1930′s a new national banking system was created. Banks were required to join to meet high standards of safety and soundness. The purpose was to prevent future failures of banks and to prevent another disastrous depression. Savings and Loans (which still exist but call themselves Banks today) were created primarily to lend money to people to buy houses. They took their depositor’s money, lent it to people to buy homes and held these loans in their portfolio. If a homeowner failed to pay and there was a loss, the institution took the loss. The system was simple and the institutions were responsible for the building of millions of homes for over 50 years. This changed drastically with the invention of the secondary market, collateralized debt obligations which are also know as collateralized mortgage obligations.

Our government created the Government National Mortgage Association (commonly known as Ginnie Mae) and the Federal National Mortgage Association (commonly known as Fannie Mae) to purchase mortgages from banks to expand the amount of money available in the banking system to purchase homes. Then Wall Street firms created a way to expand the market exponentially by bundling up home loans in clever ways that allowed originators and Wall Street to make big profits. The big stock market firms were securitizers of mortgage-backed securities and resecuritizers who sliced and diced different parts of the groups of home loans to be bought and sold in the stock market based on prices set by the market and market analysts. Home loans, packaged as securities, are bought and sold like stocks and bonds.

In the quest to do more and more business, the standards to get a loan were lowered to a point where, at least in some cases, if a person wanted to buy a house and could assert they could pay for it they received the loan. Borrowers with weak or poor credit histories were able to get loans. There was little risk to the lender because unlike the earlier days when home loans were held in their portfolios, these loans were sold and if the loans defaulted the investors or purchasers of these loans would take the losses i.e. not the bank making the loan. The result today is tumult in our economy from the mortgage meltdown which has disrupted the overall financial system and affects all lending in a negative way.

Who is responsible for this situation? All loan originators, including banks, are responsible for turning a blind eye to loans that were based on poor credit criteria. Under the label of “subprime” loans there were low documentation loans, no documentation loans and very high loan to value loans- many of which are the foreclosures we read about on a daily basis. Wall Street is responsible for pumping this system into a financial disaster that may grow from the current $400 billion dollar estimate to over a trillion dollars. Realtors, mortgage brokers, home buyers and speculators are responsible for their willingness to pay higher and higher prices for homes on the belief that prices would only go higher and higher. This basically fueled the system for the mortgage meltdown.

Are there any similarities to the saving and loan crisis of the 1980′s? Between 1986 and 1995 Savings and Loans (S&L’s) lost about $153 billion. The institutions were regulated by the Federal Home Loan Bank Board and the Federal Savings and Loan Insurance Corporation. These entities passed laws that required the S&L’s to make fixed rate loans only for their portfolios. The rates that could be charged for these loans were determined by the marketplace. Imagine an institution with $100 million in loans at 6% to 8%. For years the interest rates on deposits were also regulated by the government. The interest rate spread between the two allowed institutions to make a small profit.

In 1980 the U.S. Congress passed the Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA). A committee was established in Congress. Over a period of years the committee deregulated the rates S&L’s could pay on savings. Nothing was changed with respect to what could be charged for home loans. Many institutions started to loose huge amounts of money because they had to pay market rates of 10% to 12% for their savings, yet they were stuck with their old 6% to 8% loans. Some executives in the savings and loan business referred to this committee as the damned idiots in Washington.

Many books have been written about these events. There is documented evidence of substantial wrongdoing by S&L executives who were trying to invest funds to save their institutions, sometimes for personal gains. Some were sophisticated criminals. Congress recognized their mistake in 1982 when the Garn-St.Germain Depositary Institutions Act was passed to allow S&Ls to diversify their activities to increase their profits. It also allowed S&L’s to make variable rate loans. It was too little too late. After bankrupt institutions were liquidated by the government, the surviving S&Ls were assessed billions of dollars by the Federal Deposit Insurance Corporation to replenish the fund that insures the depositors of all U.S. banking institutions.
The mortgage meltdown and the savings and loan crises are similar with regard to the presence of greed and criminal activity. They are very different with respect to the fact that the S&L crises originated from a broken government mandated regulatory system and the mortgage meltdown has been caused primarily by a system that went wild with greed.

This has impacted non-bank lenders such as private commercial finance companies that provide hard money real estate loans, purchase order financing and accounts receivable financing. Most of these firms have raised their prices and their origination standards for safety and soundness of operations.

The bottom line: Bank lending can be replaced by other sources such as commercial finance companies to some degree. Hard money, purchase order financing and accounts receivable financing will help some businesses grow during these difficult times. But for the average borrower, businessman, or business owner these are difficult economic times, caused by the mortgage meltdown, which are here to stay for several years.

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Commercial Financing – The Benefits of Off-Balance-Sheet Financing

There are two different categories of commercial financing from an accounting perspective: on-balance-sheet financing and off-balance-sheet financing. Understanding the difference can be critical to obtaining the right type of commercial financing for your company.

Put simply, on-balance-sheet financing is commercial financing in which capital expenditures appear as a liability on a company’s balance sheet. Commercial loans are the most common example: Typically, a company will leverage an asset (such as accounts receivable) in order to borrow money from a bank, thus creating a liability (i.e., the outstanding loan) that must be reported as such on the balance sheet.

With off-balance-sheet financing, however, liabilities do not have to be reported because no debt or equity is created. The most common form of off-balance-sheet financing is an operating lease, in which the company makes a small down payment upfront and then monthly lease payments. When the lease term is up, the company can usually buy the asset for a minimal amount (often just one dollar).

The key difference is that with an operating lease, the asset stays on the lessor’s balance sheet. The lessee only reports the expense associated with the use of the asset (i.e., the rental payments), not the cost of the asset itself.

Why Does It Matter?

This might sound like technical accounting-speak that only a CPA could appreciate. In the continuing tight credit environment, however, off-balance-sheet financing can offer significant benefits to any size company, from large multi-nationals to mom-and-pops.

These benefits arise from the fact that off-balance-sheet financing creates liquidity for a business while avoiding leverage, thus improving the overall financial picture of the company. This can help companies keep their debt-to-equity ratio low: If a company is already leveraged, additional debt might trip a covenant to an existing loan.

The trade-off is that off-balance-sheet financing is usually more expensive than traditional on-balance-sheet loans. Business owners should work closely with their CPAs to determine whether the benefits of off-balance-sheet financing outweigh the costs in their specific situation.

Other Types of Off-Balance-Sheet Financing

An increasingly popular type of off-balance-sheet financing today is what’s known as a sale/leaseback. Here, a business sells property it owns and then immediately leases it back from the new owner. It can be used with virtually any type of fixed asset, including commercial real estate, equipment and commercial vehicles and aircraft, to name a few.

A sale/leaseback can increase a company’s financial flexibility and may provide a large lump sum of cash by freeing up the equity in the asset. This cash can then be poured back into the business to support growth, pay down debt, acquire another business, or meet working capital needs.

Factoring is another type of off-balance-sheet financing. Here, a business sells its outstanding accounts receivable to a commercial finance company, or “factor.” Typically, the factor will advance the business between 70 and 90 percent of the value of the receivable at the time of purchase; the balance, less the factoring fee, is released when the invoice is collected.

Like with an operating lease, no debt is created with factoring, thus enabling companies to create liquidity while avoiding additional leverage. The same kinds of off-balance-sheet benefits occur in both factoring arrangements and operating leases.

Keep in mind that strict accounting rules must be followed when it comes to properly distinguishing between on-balance-sheet and off-balance-sheet financing, so you should work closely with your CPA in this regard. But with the continued uncertainty surrounding the economy and credit markets, it’s worth looking into the potential benefits of off-balance-sheet financing for your company.

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How Asset-Based Loans From Commercial Finance Companies Differ From Traditional Bank Loans

When it comes to the different types of business loans available in the marketplace, owners and entrepreneurs can be forgiven if they sometimes get a little confused. Borrowing money for your company isn’t as simple as just walking into a bank and saying you need a small business loan.

What will be the purpose of the loan? How and when will the loan be repaid? And what kind of collateral can be pledged to support the loan? These are just a few of the questions that lenders will ask in order to determine the potential creditworthiness of a business and the best type of loan for its situation.

Different types of business financing are offered by different lenders and structured to meet different financing needs. Understanding the main types of business loans will go a long way toward helping you decide the best place you should start your search for financing.

Banks vs. Asset-Based Lenders

A bank is usually the first place business owners go when they need to borrow money. After all, that’s mainly what banks do – loan money and provide other financial products and services like checking and savings accounts and merchant and treasury management services.

But not all businesses will qualify for a bank loan or line of credit. In particular, banks are hesitant to lend to new start-up companies that don’t have a history of profitability, to companies that are experiencing rapid growth, and to companies that may have experienced a loss in the recent past. Where can businesses like these turn to get the financing they need? There are several options, including borrowing money from family members and friends, selling equity to venture capitalists, obtaining mezzanine financing, or obtaining an asset-based loan.

Borrowing from family and friends is usually fraught with potential problems and complications, and has the potential to significantly damage close friendships and relationships. And the raising of venture capital or mezzanine financing can be time-consuming and expensive. Also, both of these options involve giving up equity in your company and perhaps even a controlling interest. Sometimes this equity can be substantial, which can end up being very costly in the long run.

Asset-based lending (or ABL), however, is often an attractive financing alternative for companies that don’t qualify for a traditional bank loan or line of credit. To understand why, you need to understand the main differences between bank loans and ABL – their different structures and the different ways banks and asset-based lenders look at business lending.

Cash Flow vs. Balance Sheet Lending

Banks lend money based on cash flow, looking primarily at a business’ income statement to determine if it can generate sufficient cash flow in the future to service the debt. In this way, banks lend primarily based on what a business has done financially in the past, using this to gauge what it can realistically be expected to do in the future. It’s what we call “looking in the rearview mirror.”

In contrast, commercial finance asset-based lenders look at a business’ balance sheet and assets – primarily, its accounts receivable and inventory. They lend money based on the liquidity of the inventory and quality of the receivables, carefully evaluating the profile of the company’s debtors and their respective concentration levels. ABL lenders will also look to the future to see what the potential impact is to accounts receivable from projected sales. We call this “looking out the windshield.”

An example helps illustrate the difference: Suppose ABC Company has just landed a $12 million contract that will pay out in equal installments over the next year, resulting in $1 million of revenue per month. It will take 12 months for the full contract amount to show up on the company’s income statement and for a bank to recognize it as cash flow available to service debt. However, an asset-based lender would view this as receivables sitting on the balance sheet and consider lending against them, depending on the creditworthiness of the debtor company.

In this scenario, a bank might lend on the margin generated from the contract. At a 10 percent margin, for example, a bank lending at 3x margin might loan the business $300,000. Because it looks at the trailing cash flow stream, an asset-based lender could potentially loan the business much more money – perhaps up to 80 percent of the receivables, or $800,000.

The other main difference between bank loans and ABL is how banks and commercial finance asset-based lenders view the business’ assets. Banks usually only lend to businesses that can pledge hard assets as collateral – mainly real estate and equipment – hence, banks are sometimes referred to as “dirt lenders.” They prefer these assets because they are easier to control, monitor and identify. Commercial finance asset-based lenders, on the other hand, specialize in lending against assets with high velocity like inventory and accounts receivable. They are able to do so because they have the systems, knowledge, credit appetite and controls in place to monitor these assets.

Apples and Oranges

As you can see, traditional bank lending and asset-based lending are really two different animals that are structured, underwritten and priced in totally different ways. Therefore, comparing banks and asset-based lenders is kind of like comparing apples and oranges.

Unfortunately, many business owners (and even some bankers) don’t understand these key differences between bank loans and ABL. They try to compare them on an apples-to-apples basis, and wonder especially why ABL is so much “more expensive” than bank loans. The cost of ABL is higher than the cost of a bank loan due to the higher degree of risk involved in ABL and the fact that asset-based lenders have invested heavily in the systems and expertise required to monitor accounts receivable and manage collateral.

For businesses that do not qualify for a traditional bank loan, the relevant comparison isn’t between ABL and a bank loan. Rather, it’s between ABL and one of the other financing options – friends and family, venture capital or mezzanine financing. Or, it might be between ABL and foregoing the opportunity.

For example, suppose XYZ Company has an opportunity for a $3 million sale, but it needs to borrow $1 million in order to fulfill the contract. The margin on the contract is 30 percent, resulting in a $900,000 profit. The company doesn’t qualify for a bank line of credit in this amount, but it can obtain an asset-based loan at a total cost of $200,000.

However, the owner tells his sales manager that he thinks the ABL is too expensive. “Expensive compared to what?” the sales manager asks him. “We can’t get a bank loan, so the alternative to ABL is not landing the contract. Are you saying it’s not worth paying $200,000 in order to earn $900,000?” In this instance, saying “no” to ABL would effectively cost the business $700,000 in profit.

Look at ABL in a Different Light

If you have shied away from pursuing an asset-based loan from a commercial finance company in the past because you thought it was too expensive, it’s time to look at ABL in a different light. If you can obtain a traditional bank loan or line of credit, then you should probably go ahead and get it. But if you can’t, make sure you compare ABL to your true alternatives.

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Why It Is Important To Buy A Home Cover

Nature’s fury or riotous incidences don’t come knocking at your doorstep. Within couple of minutes it can turn down your dream like a pack of cards. It will not only affect your emotions but also impact your finances. At times, a mere earthquake or tsunami leaves millions of people across the world penniless and with no homes. Therefore, the best way to protect your home and its valuable belongings from getting damaged is to own a suitable Home insurance policy.

A home insurance is a form of property insurance designed to cover an individual’s home from damages to the house itself, or to possession in the home. It will also cover your liability or legal responsibility for any injuries and property damage, you or members of your family cause to other people.

Despite of knowing the benefits and best of the coverage to secure their house from any uncertainty and unexpected problems still majority of home owners try to avoid buying home insurance in India because of its expensive costs. Especially in economic slowdowns people start to contemplate whether or not carrying an insurance policy on their home is really necessary. They begin to think that the money being spent on the policy could be better spent elsewhere. This can be a dangerous way to think.

Home insurance, which covers the house and its contents from fire, theft, burglary and other security concerns, is still a segment that has not seen enough takers

Home insurers also provide cover for household appliances including television, washing machine, refrigerator and jewelry or valuables that are kept in the house. In some cases, even pets in the house, at the time of an accident or robbery and are injured in the incident gets a cover. Terrorism and catastrophic incidents are also covered under some products.
Home insurance is something that everybody that owns a home must deal with. If you are considering switching insurance companies, the process can be a little confusing. While looking for insurance cover the first thing that you need to do is find the company that you are going to switch over to. You will want to shop around and make sure that you are getting the best rate available.

You can do this in a number of different ways. Check out some independent review sites and see who is rated as the best company for insurance. Get a few rate quotes online and then visit an agent. They will be able to tell you what everything costs and give you an idea if you are better off than you were. Choose the best company that fits your needs and is within your budget. Once you decide on a company, you will have to do the necessary paperwork to get a Home insurance. You can usually do this in a few minutes while you’re sitting in the office of the agent that you chose to work with. They will have a few forms to fill out and you will be ready to go. They will ask you some basic questions about the property including the value of the property and if you have any special items to be insured. You will have to decide on the coverage limits and the features that you want.

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Different Premium Payment Modes Available In Life Insurance

Affordable premiums are definitely one of the most important features of an insurance plan, however it should also have a balanced share of benefits to offer as well. Here in this article we discuss the basic types of premiums and some of the common modes of payments available with the life insurance plans in market.

Types of life insurance premiums:

There are basically two types of premium payments namely single premium and regular premiums. At the time of opting for the plan, every policyholder would be explained in brief by the insurance agent or company about these two terms in particular. These two types of premiums are determined by the quantum of payment and the frequency decided by the person insured. Single premiums require a lump sum payment to be made by the insured at the time of entry while in regular premiums, he/she will be required to makes payments on a monthly, quarterly, half-yearly, or yearly basis. Both single premium and regular premium plans have their own benefits, yet the former proves to be more efficient when considering the total cost involved. The below example illustrates the basic difference between the two types of premiums.

A 32 year old woman pays a yearly premium of Rs.13,000 for 10 years on her life insurance policy, that offers survival benefits of Rs.2,00,000 on maturity. Going by this mode of payment, she will pay a total amount of Rs.1,30,000 by the end of the term period. However, the same plan comes with an option for single premium whereby a person is required to pay a lump sum amount of Rs.90,000 at the time of enrollment. In the second instance, the person insured can save up to Rs.40,000 on premiums. Taking into account the time value of money and rate of inflation, lump sum payments can often supersede the benefits of regular premiums. But again, making payments in one go may not be feasible for many customers and it is finally on their part to choose the type of payment after evaluating budgetary requirements. Therefore, make sure that you opt for the single premium mode only if you can afford the same without straining your finances.

Premium paying frequency:

Under regular premium mode, policyholders are required to pay premiums throughout the term period, while for some policies, the premium term is less than the policy term. For example, if your purchase a policy that offers life insurance coverage for 10 years, you can either choose to pay the premium for the entire length of the plan or choose a reduced payment term of 7 or 8 years. As a general rule of thumb, the number of installments is directly proportional to the sum insured, ie.,higher the sum insured more the number of installments. Once you have chosen the regular payment option, you then need to decide the frequency of premium payments which is either monthly, quarterly, semi-annually, or annually. Your premium payment term is also linked to the surrender value of the policy. Generally, a life insurance plan acquires surrender value after completion of 2 premium years. So in case you surrender your policy after the first year, you will not be eligible for the same.

Different method of paying your insurance premiums:

Gone are the days when one had to wait in long queues at the branch counters to deposit life insurance premiums. Going in line with the digital advancements of today, even insurance companies have launched apps and web platforms to offer a comprehensive range of services online. Given below are some of the most common methods of insurance premium payments:

Insurance agents – An insurance agent visiting your home to collect premiums was a common scene in early days, when private companies had only started to secure a foothold in the Indian insurance industry. Even with the changed times and latest digital enhancements, you can always get in touch with a collection agent of your insurer to come and collect your payments.

Mobile wallets – Post demonetization, the importance of mobile payments have increased so rapidly that a number of e-wallet companies have entered the market within a short span. The e-wallets offer a lot of facilities ranging from booking a ticket to paying off your monthly bills. Some of the mobile wallets have linked up with the insurance companies to facilitate fast and convenient premium payments for policyholders.

Online payments – As already mentioned, you can simply login to the insurer’s website and pay your premiums through internet banking, credit cards, or debit cards

Standing instruction on credit card – You can give a standing instruction to your insurance company to deduct the premium amount on your behalf. You just have to submit an application for the same along with the details of your credit card.

Electronic Clearing System – It’s an automated system of payment where the premium amount gets deducted from the bank account of the customer on due date. You can register for this service by filling out the ECS mandate form and submitting it along with other relevant details to the concerned branch of your insurance company.

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Determine The Type Of Vegetarian You Are

When it comes to vegetarianism, the fact that one size doesn’t fit all cannot be denied. Several food and health experts are of the opinion that today more and more individuals are adopting some kind of vegetarian diet, however, what they opt to eat and not eat relies on what type of vegetarian they want to be. Many believe that the number of people eating vegetarian diet is growing, as there are large numbers of options available in restaurant menus and in pre-packaged foods at the grocery store.

Being Vegetarian What does it actually mean?

Generally Speaking, the diet of a vegetarian comprises of vegetables, fruits, peas and dried beans, grains, nuts and seeds and no meat and fish. However, even within the vegetarian category, there are several subgroups, which include the following:

Lacto vegetarians consuming plant foods plus dairy products
Lacto-ovo vegetarians consuming both dairy products and eggs
Vegans avoiding all animal products no eggs, no dairy and consume only grains, vegetables and fruits

Semi-Vegetarians

The next category is those who call themselves semi vegetarians. Several of the top 10 dietitians and experts in the country believe that semi-vegetarian doesn’t have one standard definition. A semi vegetarian could be an individual who typically eats vegetarian diet, however, occasionally eats meat, for example, or it could be someone who doesn’t eat red meat but eats other type of meat.

Diet Including Raw Foods

There are some individuals who also eat and enjoy a raw food diet. In a raw food diet, an individual is enticed to eat uncooked stuff that’s truly raw products, uncooked, non-homogenized, etc. Again, there isn’t a single definition as it bundles a bunch of things. For instance, some individuals would eat all of raw foods or others consider eating raw foods even if they actually eat a two third portion of it. A raw food diet could include vegetable only or might even include meat, fish and eggs as well.

Why do People Opt for a Vegetarian Diet?

There are different reasons people prefer a vegetarian diet, but most prefer the diet for health reasons. A recent study has revealed that vegetarians have a lower body mass index (BMI) and lower cholesterol and are less likely to be affected from heart disease. They could also be at lower risk for other drastic diseases and can have effective weight loss as well. Others turn towards a vegetarian diet for religious beliefs, due to environmental or animal welfare concerns, just for economic reasons or because they just don’t like the taste as well as texture of meat.

Does a Vegetarian Diet really offer Health Benefits?

Individuals who consume only a vegetarian diet might not be providing their body vital nutrients it really requires to function optimally. The specific concern remains for vitamin B-12, which comes naturally only from animal sources, vitamin D, iron, zinc and calcium. So, if you are considering switching to a complete vegetarian diet, it’s recommended to talk to an expert nutritionist/dietician to ensure you get the nutrients you require to stay healthy.

Being a vegetarian is not bad at all provided you know what type of a vegetarian you want to be and you are having all nutrients in a proportionate manner.

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Ayurvedic Weight Loss Supplements To Reduce Excess Body Fat

Being overweight is like a curse as it raises several health problems. It is generally seen that some people eat a lot but do not gain weight while some gain weight even on eating less. Losing weight is a difficult task especially for those who suffer from mental problems as they find eating foods as the only way to satisfy themselves. There are some common reasons behind the increasing weight in body:

1. Weight gain depends on the metabolic rate of body. Slow metabolism in body is the main cause of not burning calories and increasing body weight.
2. Immunity becomes weak due to lack of iron, magnesium and vitamin D in regular diet and this alters metabolism of body.
3. People having stress, tension and depression mostly eat junk foods, take beverages and drink alcohol more just to distract themselves and thus weight increases in such people.
4. Increasing age slows down digestion and reduces metabolic rate. This results in weight gain.
5. Less production of testosterone in men and estrogen in women leads to increase in weight.
6. People having problem of thyroid disorder also gain weight in an unusual manner.

Some changes in lifestyle can help to lose excess weight at home:

1. The most important step for weight loss is to cut back on sugar and starch. This reduces insulin and also reduces hunger for calories.
2. Eating meals rich in protein source, fat source and low-carb vegetables also help to lose few calories. These kinds of foods reduce desire for snacking.
3. Lifting weights 3 times a week can burn a few calories which further prevents metabolism from slowing down.
4. Taking proper sleep is an important part of losing weight fast.
5. Eating foods slowly makes one feel full after eating even small meals and thus one does not overeat.

One can also use InstaSlim capsules to reduce excess body fat naturally. These are the best ayurvedic weight loss supplements as these supplements are made purely from herbs. These supplements help to combat every factor in body that results in increase in weight.

InstaSlim capsules provide the following benefits to overweight people:

1. These supplements suppress appetite and thus reduce cravings for sugary and junk foods.
2. Unique formula of these capsules promotes metabolic rate in body to increase utilization of body fat.
3. These ayurvedic weight loss supplements improve blood circulation to increase usage of fat stored in body for producing energy.
4. Promote fat metabolism to keep production of energy regular in body.
5. These supplements regularize bowel movements which in turn keep toxins out of body.
6. Nullify ill effects of thyroid disorders on metabolic rate.

InstaSlim capsules are loaded with Vaivading, Babool, Arjun, Pashanbhed, Chitrak, Jawasa, Bahera, Kali Mirch, Haritaki, Dikamari, Samudra Shosh, Chavya and Sounth. These herbs have the property to convert fat cells into energy. These herbs can effectively enhance functions of body organs that help in digestion and absorption of nutrients from foods. These herbs also keep bowel movements regular for healthy weight loss. To get long lasting and effective results, use these ayurvedic weight loss supplements on a regular basis. Taking InstaSlim capsules for 3 to 4 months can reduce excess body fat and give optimum health benefits.

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5 Things You Need To Know About Commercial Finance

Introduction

Most people, especially “first time buyers”, tend to think only in terms of approaching their own banks when it comes to arranging finance. There are, however, other sources. There are Commercial mortgage Lenders, Asset Finance Lenders, Lenders that specialise in factoring/invoice discounting, lenders that can provide finance based on existing pensions, refinancing of existing commercial finance and much, much more. Also consider a personal loan or mortgage.

What Security Do You Have For The Loan

For large commercial loans, commercial finance lenders usually require land and buildings as security for the loan. In the current economic climate it is very difficult to get finance for more than 70% of the value of the loan – although in a very limited number of cases – not impossible! If you are looking for more than 70% – be prepared to look for other alternatives. For smaller loans, vehicles, plant, equipment etc. may be acceptable. Some lenders even allow you to refinance equipment that you already own (say a car) thereby enabling you to release capital into your business.

Which Commercial Finance Sector Does Your Application Fall Into

Not every lender is interested in lending across the complete range of business sectors. They are competitive only in the sectors in which they are keen to lend. For example, land and property – mortgages, vehicles, plant and machinery – asset finance. You should therefore decide which business sector your requirement falls in.

What Is Your Credit History

The better your credit history the lower the interest rate that you will have to pay. If your credit history is not perfect (and in this current credit crunch very little is being seen as perfect credit history) you will need to be applying to a specialist commercial finance lender.

Government Grants

The UK government provide various grants for businesses. Some of the most common are Under the Small Firms Loan Guarantee Schemes [EFG] (which are easy to set up),. 75% of risk is taken by Government and provides another way of introducing vital growth capital to small businesses. Not available if there is existing potential security such as high equity in property where a secured loan could be set up.

R&D Tax Credits can be available to companies who carry out any research and development, including engineering, software, computer hardware or any product development, can be eligible for claiming R & D tax credits. This can mean the equivalent of an injection of capital for as much as £70,000.

DTI Marketing [and other] Government grants can be available to companies in most sectors for the development of business by using DTI Marketing (and other) Grants.

Approach A Lender Direct Or Use A Broker.

When obtaining a commercial loan, the Lender usually charges a fee for providing the loan. If you decide you use a Broker then the Broker will also usually charge a fee for arranging the loan. Whilst the natural reaction is to approach Lenders direct, a Broker will deal with lots of lenders covering many different sectors and so can be more efficient in the long run. A good Broker will be able to provide help in sourcing of finance for all of the above loan and more.

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Factoring – A Commercial Financing Alternative to Venture Capital

In today’s difficult credit environment, companies are turning over every stone and looking in every nook and cranny in their efforts to obtain the commercial financing they need to grow and prosper.

Skip Green, the founder and president of Alden Green, Associates in Oakville, Ontario, has been helping companies obtain commercial financing for nearly two decades. The primary financing tools Green recommends are venture capital, private or angel financing, government guaranteed loans and grants-and factoring services.

Why VC Is a Tough Game

“Business owners often have a preconceived idea that venture capital is going to be the solution to their financing problems, but VC is a tough game,” says Green. “Investors are very cautious even in the best of times, and especially so today. They want everything on a silver platter before they’re willing to part with their money.”

Green doesn’t hesitate to recommend factoring services to companies when the circumstances warrant it. “Sometimes there’s a certain resistance when I bring up factoring, but the reality is that factoring services are often a better and cheaper way to obtain financing than venture capital. When business owners see this reality, I encourage them to give some more thought to factoring.”

Green left the banking world in 1992 to strike out on his own in helping companies raise commercial financing. He aligned himself with private investors who were looking for good growth opportunities and started playing matchmaker between them and companies seeking commercial financing. In 2004, he was talking with the owner of a wireless telecommunications firm headquartered in New York that needed start-up funding and quickly realized that they might be an excellent candidate for factoring services.

Unique Financing Challenges

The owner explains the unique financing challenges his company faced during its early years: “We work mostly on a project basis so we have to ramp up a large number of project managers, quality inspectors, field technicians and other employees very quickly. In effect, we build an army and then move it from city to city until a new wireless network is built.”

With potentially hundreds of job sites and thousands of employees, the company faced huge challenges in financing its operations in the beginning. “We reached a critical mass when accounts receivable were very high but aging and we still needed to make payroll.” He says the firm’s employees are its greatest expense, but also its greatest strength.

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