May 30th, 2008 | Investing |
The Small Business Administration (SBA) was created by the United States government in 1958 to provide a clear and efficient path for small businesses to acquire capital. The SBA raises capital by selling SBA Guaranteed Certificates to various public and private investors. The capital acquired is then dispersed as debentures to licensed Small Business Investment Companies (SBIC’s), who in turn invest in small business portfolios with the intent to stimulate the flow of private equity capital and long-term loans to small businesses.
SMALL BUSINESS INVESTMENT COMPANY (SBIC)
SBIC’s contribute equity and/or debt capital to small businesses and may be viewed as small, regionally-focused private equity firms or mezzanine investors. Collectively, these firms provide more than 2,100 unique businesses with investment capital annually.
SBIC’s undergo a rigorous SBA licensing program. To qualify, an SBIC firm must be privately managed, create for-profit investment funds, invest in small businesses and subject themselves to an annual regulatory audit. For this, SBIC’s may receive up to 300% additional leverage on their private capital from SBA-guaranteed debentures.
Only companies defined as “small” are eligible for SBIC financing. The SBIC Program defines “small” as a net worth less than $18.0 million and an average after tax net income for the prior two years less than $6.0 million. Further, there is a seven year maximum investment horizon for any SBIC investment. SBIC’s are also prohibited from investing in project finance such as real estate and motion pictures.
INVESTMENT TYPES
More than 90 percent of SBIC financing typically goes to operating capital (~50%) and acquisition capital (~40%). Other uses of investment capital include plant modernization, refinancing, new building construction, purchase of new equipment and machinery, land acquisition, marketing activities and research and development.
Approximately half of all SBIC financing is straight equity, about 25 percent is straight debt and the remaining 25 percent is a debt-with-equity structure.
ADVANTAGES
SBIC’s are designed to leverage private capital with SBA debenture securities (up to three times the amount of private capital) to create a much larger pool of funds to invest. The SBA contribution increases the fund amount while reducing the time and effort required to raise larger pools of investment capital for a private fund.
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May 26th, 2008 | Debts |
Debt consolidation quote is the first step in your journey towards a life without any kind of debt problems. It is a proposal that describes various options before you when you decide to move in the direction of a financially free life. A lot of people all around the world live with this kind of dream. However, to turn it into a reality, you need to select a debt consolidation plan carefully.
Absolutely Free
The best part of the story is that you can get a debt consolidation quote without paying any money at all. It really helps because anyone who is already in debt would not like to spend any money in exploring various options. Free availability of quotes allow you to keep on comparing until you come across the most suitable one in your case.
When you perform a systematic research, you will realize that it is not only the rate quoted by any lending institute but you need to look for several other factors also. Interest charges, payoff fees and any upfront fees has to be considered cautiously. Moreover, also make sure that there are no hidden costs associated with these services.
Advantages
The central idea of debt consolidation is to merge all current debts into a single bigger loan with lower interest rate. Not only it cuts down the cost of borrowing but it also makes debt management easier. Dealing with only one lender once every month is definitely more convenient than coping up with several lenders.
However, bear in mind that there is no use doing all this exercise if you are unable to save any money. Best debt consolidation quote is one that offers a solution that brings down both interest charges and monthly installment to a considerable extent. Therefore, do not make any decision in haste. There is no need to panic at all. You are not going to miss the train by spending an additional day in carrying out the organized study. Instead, you might end up saving few hundred extra dollars.
May 25th, 2008 | Mortgage |
From a cursory survey of websites and brochures, you’ll see a myriad of different types of mortgage. The mortgages explored so far are a basic overview – you’ll find any amount of types – some combining several features and with added incentives to tempt you.
Basically, if you can imagine a mortgage, it probably exists. So, after doing your homework and boning up on mortgage terminology, how do you finally choose? Which deal is the best on the market today?
The truth is that there is no one-size-fits-all super mortgage that will be a perfect fit for everyone’s financial situation. What you need to do when choosing a mortgage is work out exactly what would suit you – and this will depend on your individual circumstances. Once you have an idea of what you’re looking for, you can let the lenders and brokers find the mortgage to fit.
Below are some examples of possible life situations, with ideas for mortgages that may be suitable:
The Student
Young, single, and likely to be forever short of cash! It’s unlikely you’ll be able to find a large lump sum for a mortgage, and your income probably comes from part time jobs – hardly an enticing prospect for a lender. Your best bet is to approach family for help – a loan for the deposit and/or a guarantor mortgage (combined with proof of your responsible attitude) could help you get an early foothold on the property ladder.
Pushing 30
You’re paving the way to a successful career, and perhaps thinking of moving in with a partner. However, your salary is probably relatively modest, and you may not have much money saved. Ask lenders for their first time buyer deals, including 100% mortgages, and consider a joint mortgage with a partner to boost your buying power. Cashback may be useful for covering the costs of fees and buying furniture. Those willing to take a bit of a risk could consider an interest only mortgage combined with savings and investments.
Growing Success
Perhaps you have a family or dependents now, and your career is fairly solidly established. You may want to make the most of your money by looking at flexible mortgages, or one that can be offset against your other accounts. Keep in mind your home may have accrued equity by now, which could be released by revaluing your home, and perhaps switching mortgage. If you run your own business and have some capital to invest, you might want to try a self-cert mortgage.