The last few posts were all about bank business loan restrictions, and how harmful they can be to your business operations and financial flexibility. Clauses like blanket liens, compensating balances, and annual requalification are common and written into almost every bank business loan. They may or may not be clearly discussed, and it’s up to the borrower to… Read More »
I’ve been writing about bank loan restrictions and clauses for a few weeks now. We went over blanket liens and compensating balances, and now we’re going to talk about maybe the scariest one of all: annual requalification. If you thought the bank saying “yes” when they gave you the loan was the end of them looking at your… Read More »
Next up in our bank loan restrictions comes compensating balances. And it’s something nearly all banks use when loaning a business money for equipment financing. A compensating balance is when a bank requires a business to keep a certain balance amount in an account with them. This balance amount is typically 80% of the equipment loan. The key… Read More »
We’re talking about lending restrictions in 2024, and first up is the notorious blanket lien. First let’s talk about liens in general. In business/lending, a lien is when a lender claims the right to property belonging to the borrower until the debt owed by that borrower is discharged. The mainstream talk on liens is usually related to vehicles.… Read More »
One of the reasons my last post was about partial business-use vehicles is we (as in Crest Capital) have dipped our toes into this area. In late 2023, we quietly launched a new program to finance business-use vehicles and SUV’s in the company name. This may not seem like a big deal on paper, but in the real… Read More »