Tag Archives: assets
Homeowner Personal Loan The Advantages Of Ownership
When you are looking for finance to fulfill your personal needs, the main problem is to get the amount of money you need. However, you probably want to pay the least possible amount of interests for that money too and you will also want to have low monthly installments and as much time as possible to repay the loan. Being a home owner will guarantee that you get the best terms on personal loans. Lets analyze how:
Ownership
Even though we are talking about home ownership, it does not hurt to give a wider idea of what ownership implies as a legal and economic term. Ownership refers to possession of an asset, any asset. Legally speaking, there is a distinction between movable property and immovable property. The first category constitutes personal assets and the second one, real assets (better known as real estate). Furthermore, there is another distinction between non-registered movable property (i.e. computers, house appliances) and registered movable property (i.e. Cars, Vans, Yachts).
Some personal assets (especially registered personal property) and real assets can be used as collateral to secure a loan. This entitles the lender to take legal action directly against the property and recover his money from the selling of the asset in a short term legal process. This greatly reduces the risk of lending money and thus, the interest rate charged for these loans is considerably lower.
Benefits Of Home Ownership
However, owning any asset (especially real estate) contributes to getting lower interest rates not only when applying for secured personal loans, but when applying for unsecured personal loans too. Ownership is generally a guarantee for the lender because it implies solvency (the ability to meet financial obligations on time.) in many ways. For starters, maintaining a property is not cheap, and thus, it shows the lender that you have been able to administrate your finances properly. But it also implies that in case you cannot afford the monthly payments and the lender has to resort to legal means to recover his money, there are more probabilities he will be able to get enough money from your assets to recover the amount owed and any legal fees he might incur in.
Lower rates are not the only benefit you can get from home ownership. The amount of money you can request is also an important factor. Home owners, due to how the property contributes to his solvency, can get higher loan amounts either with secured personal loans or unsecured personal loans. It really depends on how many assets you have and the value of each one whether you can get a higher loan amount with a secured loan or an unsecured loan. This is due to the fact that secured loans can offer as much money as the propertys value while the amount of money you can request on an unsecured loan is related to the whole value of all the debtors assets.
Furthermore, homeowners will also get longer repayment programs. Since the length of the loan is linked directly with the risk involved for the lender in the financial transaction and given that homeowners imply a considerable lower risk, homeowner personal loans have extended repayment plans with more flexible terms. And as a consequence of lower rates and longer repayment programs, homeowners also get lower monthly payments that are easily afforded.
Sale and Leaseback Financing
Sale and Leaseback Financing – What is it?
A sale and leaseback financing transaction is where the company sells it free and clear assets and leases it back simultaneously. These transactions can range anywhere from $50,000 to $6,000,000. This article will encompass the following types of industries and discuss its particulars:
Construction equipment,manufacturing equipment, production equipment, yellow iron, dump trucks and trailers, agricultural and farm equipment, and other heavy equipment
Many seasoned lenders have come up with many industries standards to make the available credit pretty much standard. The first area that the lender will consider is the the value of the free and clear asset that is going to be sold and leased back. Each lender’s formula is somewhat similar but they usually value the acquired asset somewhere between 50%-70% of the auction value. This auction value will come from trade publications and other standards in the industry for these particular assets.
Once the auction value of the asset and/or assets is established, the lender will look at the applicant’s credit. Some lenders will consider the credit irrelevant as they focus on the auction value of the asset. Other lenders will obtain the credit and grade them according. These lenders will come up with a score and give the applicants different lending rates depending upon their credit and the asset involved.
The lender will lease these bought assets anywhere from 24-85 months back to the applicant. Additionally, the lender will offer residual buyout clauses anywhere from 25% residual to fair market value of the asset at the end of the lease. This will keep the applicant’s monthly payment as low as possible.
Sale and Leaseback Financing – What is Required? Usually, what is required from the applicant is:
Personal financial statements, a lease application, a summary telling about the deal and its particulars, and a detailed equipment list, identifying the assets to sold and leased back Obviously – bills of sale and title work will have to be performed by the lender.
The proceeds of the these funds can be used for working capital, debt re-structuring, equipment acquisitions, and paying off judgements and other liens.
Sale and Leaseback Financing – Unique Features Some other unique features of the sales and leaseback program is that usually these transactions are:
Non-bankable type transactions, home ownership isn’t required, and poor credit isn’t an issue!
In conclusion, we suggest you shop around for the best deal for yourself and understand all the particulars of the transaction. Hopefully, this article about “Sales and Leaseback” financing assists you with your decision making.