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Here Are Some Reliable Resources for Financing Large Equipment Purchases – Boca Raton’s Most Reliable News Source

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Most businesses need equipment to function. Equipment is a part-and-parcel of every business’s life. Whether you’re running a small business online or a large-scale brick-and-mortar shop, you’re going to need equipment in one form or the other.

Getting the equipment you need can simplify your life. However, equipment is costly and you sometimes find yourself looking for reliable equipment financiers to cover that aspect for you.

What Is Equipment Financing?

As a business, you may not have access to the kind of money required to purchase equipment on a large scale. What do you do then? Do you miss out on important equipment just because you don’t have the funds for it? No.

You look for Equipment Financiers.

In Equipment Financing, lenders lend money to finance large equipment purchases. It’s like a loan that can be paid off over time and usually involves some percentage of interest.

Equipment Financing is a more agreeable alternative to equipment leasing. Unlike equipment leading where you have to either renew your contract or return the equipment once the time period is up, in equipment financing you benefit from having equity in the equipment.

Coverage

Equipment Financing allows you to borrow 100% of the value of the equipment you require. It’s like a loan you pay off over time. This equipment loan allows you to access tens of thousands of dollars worth of equipment at practically no upfront payment from your business.

Options For Equipment Financing

Banks have a pretty lengthy process for loans in place and you may not even make the cut sometimes. With financing companies and lenders, your chances of getting approved are significantly higher.

To help you find the best possible equipment financing option for you and your business, we indulged in some thorough research. Here’s a guide on the options you have when looking for equipment financing:

0% Down

Zero Down payment is one of the most lucrative options. It allows you to take equipment loans when you don’t have the cash savings to back them.

Zero down payment is a fan-favorite among businesses who need financing to take care of their equipment needs. Through the equipment, you can reap the benefits directly without parting with your capital.

Of course, when you pay nothing in down payment, the lender takes on significant risk. This is why approval for Zero down payment usually involves:

  • Great credit score.
  • High-interest rates.
  • Higher and hidden equipment costs.

Fair Credit

Just like traditional loans, you pay a certain amount over a specific period until your funding is paid off in full. According to the lifespan and usability of your equipment, a business should try getting a short-term loan to ensure they’re not making payments on a piece of equipment after it has long been dead.

Good to Excellent Credit

With great credit, you automatically climb to the top of the list of eligible candidates for equipment financing. Having good credit gives you an edge over all the others. It shows that you’re fully capable of paying the loan amount whenever required.

Having a good to excellent credit means you get access to:

  • The best equipment lenders.
  • Great options for equipment financing.
  • Lower interest rates.

If you think you may not be using the equipment after a certain time period or are in a business where equipment gets outdated with time, it’s best to lease equipment instead of purchasing them. 

In this way, you’re free to lease newer equipment and are not stuck with equipment you have practically no use for. That’s a loss of both space and capital.

Bad Credit

Bad credit reflects poorly on a business. With bad credit, you may have to put in additional work to get approved. The best thing you can do is prepare beforehand, even when you don’t need equipment financing. Do your research so your business doesn’t have to take the brunt.

When you have bad credit, consider making up for it by:

  • Equipment leasing.
  • Working with banks or financing companies you have an existing relationship with.
  • Offering additional collateral.
  • Paying more down payment.
  • Using a co-signer.

Startups

Getting equipment financing for startups is not easy. Banks and lenders tend to stick with applicants that have a history in business and a healthy flow of revenue. However, some lenders can hook you up with reliable equipment at a fixed monthly installment to be paid over time.

You may be eligible for a startup equipment loan if:

  • You have a credit score of 600+
  • No bankruptcies in the last 7 years
  • Business license

The Takeaway

When you’re buying equipment, it’s best to do your research. You don’t want to apply for a loan and then look for the options you have. This can result in you paying more for equipment than you would have if you researched beforehand. 

The financing industry is competitive. Most businesses with a credit score or revenue can get access to premium deals and lower interest rates. Equipment financing is a cost-effective way of purchasing the equipment you want without putting in the capital required to do so.

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Are Sallie Mae Student Loans Federal or Private?

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When you hear the name Sallie Mae, you probably think of student loans. There’s a good reason for that; Sallie Mae has a long history, during which time it has provided both federal and private student loans.

However, as of 2014, all of Sallie Mae’s student loans are private, and its federal loans have been sold to another servicer. Here’s what to know if you have a Sallie Mae loan or are considering taking one out.

What is Sallie Mae?

Sallie Mae is a company that currently offers private student loans. But it has taken a few forms over the years.

In 1972, Congress first created the Student Loan Marketing Association (SLMA) as a private, for-profit corporation. Congress gave SLMA, commonly called “Sallie Mae,” the status of a government-sponsored enterprise (GSE) to support the company in its mission to provide stability and liquidity to the student loan market as a warehouse for student loans.

However, in 2004, the structure and purpose of the company began to change. SLMA dissolved in late December of that year, and the SLM Corporation, or “Sallie Mae,” was formed in its place as a fully private-sector company without GSE status.

In 2014, the company underwent another big adjustment when Sallie Mae split to form Navient and Sallie Mae. Navient is a federal student loan servicer that manages existing student loan accounts. Meanwhile, Sallie Mae continues to offer private student loans and other financial products to consumers. If you took out a student loan with Sallie Mae prior to 2014, there’s a chance that it was a federal student loan under the now-defunct Federal Family Education Loan Program (FFELP).

At present, Sallie Mae owns 1.4 percent of student loans in the United States. In addition to private student loans, the bank also offers credit cards, personal loans and savings accounts to its customers, many of whom are college students.

What is the difference between private and federal student loans?

When you’re seeking financing to pay for college, you’ll have a big choice to make: federal versus private student loans. Both types of loans offer some benefits and drawbacks.

Federal student loans are educational loans that come from the U.S. government. Under the William D. Ford Federal Direct Loan Program, there are four types of federal student loans available to qualified borrowers.

With federal student loans, you typically do not need a co-signer or even a credit check. The loans also come with numerous benefits, such as the ability to adjust your repayment plan based on your income. You may also be able to pause payments with a forbearance or deferment and perhaps even qualify for some level of student loan forgiveness.

On the negative side, most federal student loans feature borrowing limits, so you might need to find supplemental funding or scholarships if your educational costs exceed federal loan maximums.

Private student loans are educational loans you can access from private lenders, such as banks, credit unions and online lenders. On the plus side, private student loans often feature higher loan amounts than you can access through federal funding. And if you or your co-signer has excellent credit, you may be able to secure a competitive interest rate as well.

As for drawbacks, private student loans don’t offer the valuable benefits that federal student borrowers can enjoy. You may also face higher interest rates or have a harder time qualifying for financing if you have bad credit.

Are Sallie Mae loans better than federal student loans?

In general, federal loans are the best first choice for student borrowers. Federal student loans offer numerous benefits that private loans do not. You’ll generally want to complete the Free Application for Federal Student Aid (FAFSA) and review federal funding options before applying for any type of private student loan — Sallie Mae loans included.

However, private student loans, like those offered by Sallie Mae, do have their place. In some cases, federal student aid, grants, scholarships, work-study programs and savings might not be enough to cover educational expenses. In these situations, private student loans may provide you with another way to pay for college.

If you do need to take out private student loans, Sallie Mae is a lender worth considering. It offers loans for a variety of needs, including undergrad, MBA school, medical school, dental school and law school. Its loans also feature 100 percent coverage, so you can find funding for all of your certified school expenses.

With that said, it’s always best to compare a few lenders before committing. All lenders evaluate income and credit score differently, so it’s possible that another lender could give you lower interest rates or more favorable terms.

The bottom line

Sallie Mae may be a good choice if you’re in the market for private student loans and other financial products. Just be sure to do your research upfront, as you should before you take out any form of financing. Comparing multiple offers always gives you the best chance of saving money.

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Tips to do some fall cleaning on your finances

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Wealth manager, Harry Abrahamsen, has five simple ways to stay on top of the big financial picture.

PORTLAND, Maine — Keeping track of our financial stability is something we can all do, whether we have IRAs or 401ks or just a checking account. Harry J. Abrahamsen is the Founder of Abrahamsen Financial Group. He works with clients to create and grow their own wealth. Abrahamsen shares five financial tips, starting with knowing what you have. 

1. Analyze Your Finances Quarterly or Biannually

You want to make sure that your long-term strategy is congruent with your short-term strategy. If the short-term is not working out, you may need to adjust what you are doing to make sure your outcome produces the desired results you are looking to accomplish. It is just like setting sail on a voyage across the Atlantic Ocean. You know where you want to go and plot your course, but there are many factors that need to be considered to actually get you across and across safely. Your finances behave the exact same way. Check your current situation and make sure you are taking into consideration all of the various wealth-eroding factors that can take you completely off course.

With interest rates very low, now might be a good time to consider refinancing student loans or mortgages, or consolidating credit card debt. However, do so only if you need to or if you can create a positive cash flow. To ensure that you are saving the most by doing so, you must look at current payments, excluding taxes and insurance costs. This way you can do an apples-to-apples comparison.

The most important things to look for when reviewing your credit report is accuracy. Make sure the reporting agencies are reporting things actuary. If it doesn’t appear to be reporting correct and accurate information, you should consult with a reputable credit repair company to help you fix the incorrect information.

4. Savings and Retirement Accounts

The most important thing to consider when reviewing your savings and retirement accounts is to make sure the strategies match your short-term and long-term investment objectives. All too often people end up making decisions one at a time, at different times in their lives, with different people, under different circumstances. Having a sound strategy in place will allow you to view your finances with a macro-economic lens vs a micro-economic view. Stay the course and adjust accordingly from a risk and tax standpoint.

RELATED: Financial lessons learned through the pandemic

A great tip for lowering utility bills or car insurance premiums: Simply ask! There may be things you are not aware of that could save you hundreds of dollars every month. You just need to call all of the companies that you do business with to find out about cost-cutting strategies. 

RELATED: Overcome your fear of finances

To learn more about Abrahamsen Financial, click here

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How to Get a Loan Even with Bad Credit

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Sana pwedeng mabura ang bad credit history as quickly and easily as paying off your utility bills, ‘no? Unfortunately, it takes time. And bago mo pa maayos ang bad credit mo, more often than not, kailangan mo na namang mag-avail ng panibagong loan. 

Good thing you can still get a loan even with bad credit, kahit na medyo limited ang options. How do you get a loan if you have bad credit? Alamin sa short guide na ito. 

For more finance tips, visit Moneymax.

 

 

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