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Traditional Bank Financing vs. Non-Bank Commercial Finance
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Traditional Bank Financing |
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Non-Bank Commercial Finance |
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Businesses usually must be in business two years or more and financially stable. |
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Works with small businesses, start-ups and turnarounds. |
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Lengthy approval process. |
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Offers FAST approvals. |
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Financing terms are rigid; changes require new a loan. |
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Offers FLEXIBLE financing. |
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Strict guidelines regarding credit quality and history. |
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Works with no credit, bad credit. |
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Banks prefer to lend money for real estate or equipment. |
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Does not require real estate or equipment as collateral. |
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Banks prefer to lend large amounts – over $5 Million. |
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Will lend in small amounts – as little as $50,000 to $10 Million or more. |
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Increases in credit require a new application and approval. |
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Can increase credit lines quickly and by large amounts. |
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Banks typically do not assist their customers in managing collections, avoiding losses for bad debts, or offer back-office administrative support. |
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Valued-added services such as collections management, pre-sale credit workups on new customers, and directed payments to client vendors. |
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Almost always requires a Personal Guarantee. |
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Often does NOT require a Personal Guarantee. |
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