WHAT TO DO ABOUT BAD DEBTS
If in debt, you must devise some plan to get out of the red. You
can declare bankruptcy, but that will tarnish your credit and
financial records. An alternative is the "wage earner" plan,
which allows you to meet your debts methodically without
bankruptcy. remember, creditors hate bankruptcy because they may
be left with no payment. To them, 20 percent of what you owe is
better than nothing at all. But if you can get on the wage-earner
plan, there is another solution.
Sit down with your creditors and negotiate a payment plan. Tell
them how much you can pay. believe me, they will settle for less
than the actual amount owed. For more information on negotiating
with creditors, refer to the section titled "Take Over An
On-Going Business For Zero Down."
WIPE OUT DEBTS WITHOUT BANKRUPTCY
In 1938, federal law established the wage-earner plan, now
administered by the same branch of our judicial system that
To take advantage of the plan, you must be a wage earner and most
of your income come from wages, regardless of how much you make.
You can discharge any amount of your debt under this law. Here's
how it works:
1. Call the nearest U.S. District Court and find out the name of
the trustee who administers the wage-earner plan; and make an
appointment to see him.
2. Bring to your appointment all relevant financial records, such
as payment books, contracts, etc.
3. The trustee will examines your finances and set up a plan by
which portion of your debts is paid over a three-year period.
4. You then make your monthly payments to the trustee who, in
turn, pays each of your creditors.
A possible side effect of the wage-earner plan is the reduction
of much of your debts, because a provision of your filing
requires your creditors to appear in court.
Statistics show that 40 percent of creditors fail to appear in
court--in this case, you owe only 60 percent of your creditors
their claims. In some cases, none of your creditors will appear.
If this happens, all your debts are wiped out, without the pain
of bankruptcy. If some of your creditors do appear in court, the
court allows you to divide your payment into smaller amounts to
be paid over a three-year period. Once you file, you will stop
bill collectors, law suits, judgments, assignments, seized bank
accounts, and other actions against you.
Indeed, in many cases, your credit rating may improve because you
have made an honest effort to work with the lending parties to
pay off your debts.
Your debt may be wiped out entirely if a creditor used deceptive
trade practices to induce your purchase, as defined by the
Uniform Commercial Code.
You should also be aware that, that under the Homestead Act, your
residence may be exempted from levy to the extent determined by
local law. Check with a lawyer or your local courthouse for more
When first establishing credit, there are several things you
1. Open a checking account at a bank. A checking account verifies
that you have some dealings in the financial world; mortgage
banks will allow almost certainly check how you've maintained it
and, most importantly, your average balance.
2. Open as many charge accounts as you can. If any company will
make you a loan, it is a department store, by means of a charge
card--they know how closely their business is tied to charging.
Use the cards liberally, making sure you will be able to pay off
the accounts exactly according to the terms.
3. Use a cosigner. This frequently used method allows someone
with no credit to get a loan relying on the good credit rating of
someone else, say a parent. Banks are willing to risk the loan
because the cosigner is just as liable for paying back the money
as the true borrow.
5. Use a private loan company. These companies, such as Household
Finance and Beneficial Finance, are more willing than banks to
take a risk when lending money; for that risk, they charge
slightly higher interest rates. Borrow up to your limit; pay it
MAINTAINING YOUR CHECKING ACCOUNT
If you have no credit, possession of a checking account is one of
the main factors weighed by bank lenders when deciding whether or
not to give you credit.
Write down all the details of every check you write. This
practice can be very valuable during tax time.
If some of your checking expenses are tax deductible, note that
in your checkbook. You will find duplicate checks very handy.
After writing a check and transferring the amount to the
register, you should write in the new balance of your checking
account. If you do this, you will always know how much money you
have in your account. Double check that amount of the check
matches the amount you have transferred to the check register. IF
you carry a few check with you, don't forget to transfer the
amounts to your check register. Enter all your deposits in your
checkbook as soon as you make them.
KEEPING YOUR CHECKING ACCOUNT BALANCED
You should reconcile your checking account as soon as you receive
your monthly statement. Keep your check in order, preferably by
date. Compare each check you wrote with the bank statement. Mark
each check off as you go along. Do the same with deposits.
Get a check file so you can file your checks by month. If you
ever need a canceled check, you can find it easily. Subtract the
bank charges from the balance in your checkbook.
To reconcile your checking account, do the following: Subtract
all the check you have written that the bank has not deducted
from your bank balance (don't forget outstanding checks from the
previous month). Add all the deposits you have made that the bank
has not credited to your account balance. After you have finished
this, your new balance should equal your new checkbook balance.
Some banks will reconcile your checking account for you if you
You should always leave a floating amount in your checking
account. Every time you go under that amount, deposit more money.
Keep your checking account in good order--it may determine
whether or not you will be given credit.
HOW CREDITORS RATE YOU
Your credit record lists anyone with whom you have had credit
dealings. The longer your credit has been extended and the larger
amount you have been allowed to charge, the better your credit
rating will be.
The longer you are at a job and the higher you wages are, the
higher your credit rating will be. Occupations are also
important. Stable occupations improve credit ratings, as does
more than 10 years employment.
Utility companies will usually grant you credit if you have
worked for the same employer for at least 18 months.
CREDIT BUREAU FILE
You should find out if there are errors on your credit bureau
file and correct them. A bad rating with the bureau can ruin your
chances of getting credit.
BANK ACCOUNTS AND CREDIT CARDS
If you have accounts in good order, you will ensure a high
rating. Overdrawn checking accounts and unpaid credit card
balances will hurt your rating.
INCOME Your rating will improve, not because of what you make,
but because of what you bring home (net income).
Generally, the older you are, the better risk you are. By law,
those older than 62 cannot be rated lower than those younger.
Usually, dependents do not improve your credit rating because
they are considered expenses. Your ability to support your
dependents will influence your credit rating.
ADDRESS AND PHONE
Having the same address and phone number for several years show
stability, so the longer you have them, the better your credit
If you own a car, especially a late model, your credit rating
will benefit. You will also benefit if you are paying for the car
on installments and if you have always paid on time. But car
payments may also hurt you because they add to your expenses.
EXPENSES AND DEBTS
The more expenses, the lower your rating. A loan officer looks at
how much money you have left after you meet your monthly
expenses. He looks for a low-income-to-expenses ratio.
If you want to buy something on credit, the larger the down
payment you offer, the better your chances of success. The more
you put down, the lower risk you are to the lender.
METHODS OF GETTING CREDIT
If you want to establish credit at a fast, but sure pace, follow
Open a savings account, and deposit money on a regular basis.
Soon after, open an interest-bearing checking account. Have no
Pay your rent and utility bills on time. To eliminate or reduce
the large deposit usually required by utilities, have your
employer verify that you have worked for him more than 18 months.
If you apply for credit and are turned down, find out why. By
law, the party that turned you down for credit must tell you why.
When you find out why you were refused, improve that aspect of
your credit history.
Buy things on lay-away plans and pay them off in a week or two.
After doing this a few times, apply for credit at the stores, and
make sure the credit officers know about your lay-aways. Apply
for credit from all the stores you know. If you do establish
credit, make all payments early and don't miss a single one. Make
sure you can pay back all the debts you incur.
ANOTHER METHOD OF GETTING CREDIT
For this plan to work, you need to start with a least $1,000.
Borrow from friends if you have to. Go to a bank of your choice
and deposit the money in a savings account. Wait a few days for
the account to be posted, return to the bank and ask for a $1,000
loan, offering the money in your savings account as collateral.
Since your money is excellent collateral, the bank will loan you
the money without making a credit check.
Next, go to another bank and open a savings account by depositing
the $1,000 you just borrowed. return to the second bank a week
later and ask for a loan using your savings account money as
collateral. repeat this process with a third bank. Wait a few
days, then open a checking account at a fourth bank. Begin making
payments on each of the three loans. A week later, make more
payments on your three loans until you have almost paid off all
Any credit investigation will show you with three active bank
loans, a checking account and a paying history for all three
loans. Once you have established a good credit rating, you may
apply for loans, credit cards and other forms of credit.
PROTECTING YOUR CREDIT
It is your job to protect your credit. Make sure:
1. If your loan application is rejected, ask if the reason is
your credit report. If it is, get that report and correct any
errors on it, no matter what time and effort are required. When
the corrections are made, reapply for the loan.
2. If disaster strikes--you become ill or loose your job--and
can't make payments, tell your banker. Don't lie and hide.
3. Know the laws that protect you:
a) Fair Debt Collection Practices Act, which prohibits creditors
from using false or misleading threats or abuse and harassment.
b) Fair Credit Reporting Act, which allows you to get a copy of
your credit report and correct errors.
c) Truth in Lending Act, which makes lenders detail exactly how
much the loan is going to cost you.
d) equal Credit Opportunity Act, which forbids lenders denying
you credit because of your age, sex, race or marital status.
GET ANY CREDIT CARD YOU WANT
If you establish credit using the above procedure, you should
have no trouble getting any credit card you want, but there are
still a few guidelines you should follow to ensure you have no
1. Apply for department store cards first. Purchase something,
and then pay the balance off when it comes due.
2. Apply for gasoline credit cards using department store cards
3. Apply for bank cards, such as Mastercard and Visa.
4. Apply for entertainment and travel cards, such as American
Express and Diner's Club.
HOW TO GET ON A LOAN'S OFFICER'S GOOD SIDE
1. Have a good reason for requesting the loan. The likelihood of
you repaying a loan for a trip to Europe is not as great as that
of you repaying a loan for home improvements, a business venture,
a real estate purchase, etc. Prove to the loan officer that your
reason for requesting a loan is good and that you are not a high
2. Be honest. Be honest when the loan officer asks you about your
finances, but don't say more than you have to.
3. Don't get angry with the loan officer. He may say no today and
4. Be confident and optimistic at all times.
5. Agree with the loan officer on as many issues as you can.
people don't like to hear the word "no." If you must disagree,
this sales technique: "Yes, I understand what you're saying,
6. Be calm and collected at all times. Don't be afraid of the
loan officer. You will be doing as much for his institution as he
will be doing for you. Being afraid will only make you nervous
7. Know as much as possible about the loan before you apply for
it. This will put the loan officer on the defensive.
8. Be well dressed and groomed for the interview.
9. Be open to any suggestions or criticism, and try to see the
situation from the loan officer's point of view.
GETTING TURNED DOWN FOR A LOAN
If you are turned down for a loan, find out why--it's your right.
Request your TRW report, and be sure it is accurate. Correct any
errors on it. By studying your credit report, you should be able
to find out why you were refused. Work on your weaknesses, and
try again for another loan. Don't give up until you get a loan.
If you have done all you can to improve your credit rating, and
are still unable to obtain from your bank, consider these
1. A credit union loan--often they are easier to get than loans
from a bank, and the interest is sometimes lower.
2. A source other than your bank--often other lending
institutions have less rigid qualifications for loaning their
money; for examples, Household Finance and Beneficial Finance.
Interest is usually higher, however.
3. A cosigner--often you will get a loan if someone with a good
credit rating cosigns your application.
RAISING LARGE AMOUNTS OF MONEY
I have put together a list of some of the best creative financing
techniques available. People have made a lot of money using these
techniques, and that's why companies charge $10 to $20 just to
share them with you.
Raise $200,000 In 24 Hours With Only Your Signature As Collateral
Many people have opportunities that require quick cash, but most
are unable to capitalize because of a lack of ready money.
There is a simple procedure that allows you to generate quick
cash in 24 hours. The process is easy and fast, but requires that
you first make necessary preparations and lay out the groundwork
for the plan. Begin by going to 10 banks and telling the loan
officer at each that you want to borrow $1,000 for 10 Days.
After paying back your loans, wait 30 days before going back to
the banks. This time, request a larger amount, depending on what
you think the bank will loan, say $5,000. If each bank approves a
$5,000 loan, you raise $50,000 the second time you collect from
Continue this step-by-step process. Each time you go to the bank,
ask for a larger loan and a longer pay back period. What you are
doing is establishing a millionaire's credit rating using the
process of repetition. That is, you are always paying back the
money when it is due. Making your payments on time, combined with
the number of loans that you have taken out and paid back,
enables you to establish a very powerful credit rating and good
relations with lending institutions.
After using this procedure for about a year, you should be able
to borrow $20,00 from each bank on just your signature. Using 10
banks in this plan, you will be able to borrow $200,000 on your
signature in as little as 24 hours.
HOW TO KEEP BORROWED MONEY INDEFINITELY
A variation of the previous plan enables you to maintain a
constant cash flow. By applying to twice as many banks, you may
pay back loans with loans you receive from other banks. However,
wary of using such a method, but don't forget that companies do
this all the time. They issue bonds to pay off debts, and when
these bonds are due, they issue more bonds. Debt-renewal systems
are very common among investors.
HOW TO RAISE $50,000 OVERNIGHT ON YOUR SIGNATURE
You can borrow up to $50,00 and use for as long as you like. How?
With the use of overdraft protection, which is, in effect, a
loan. It is money that is transferred into your checking account
when you overdraw.
Once you qualify, this protection is automatic, but there is
usually a predetermined overdraw limit set by your bank, and you
usually have to pay interest on the money you borrow. Once you
have worked out a "credit plan," it is not hard to get your
The first step of this system is to open 10 checking accounts at
four different banks. Apply for overdraft protection with a
$5,000 limit at each bank. It is important that you apply for
overdraft protection at each bank without the other banks knowing
that you already have such accounts. Banks don't want to
overextend you. If they know that you have other accounts, they
may deny you accounts at their branches. You may think $5,000 is
a high limit, but it's not for a bank. Banks often have checking
accounts with overdraft limits of up to $25,000
Some banks may not give you a $5,000 limit at first, but don't
let that discourage you. Stay with the bank for a few months,
then reapply for the $5,000 limit.
Do you see how easily you can transform this overdraft protection
into $50,000 cash overnight with only your signature as
collateral? You can raise $50,00 by writing 10 checks for $5,00
KEEP MONEY FOR AS LONG AS YOU LIKE
Banks usually require you to pay back 5 percent, or
one-twentieth, of the loaned amount every month. However, this
rule is not always enforced.
If you keep your loan under the overdraft limit, the bank may not
require you to make principal or interest payments. Some banks
require you to make payments every month. How can you keep the
money? Borrow money from eight different banks, each with $5,000
overdraft limits, and you have $40,000 to use.
Let's say that your loan payments total $2,200 per month. Use a
loan from a ninth bank to make the first two monthly payment. For
the third monthly payment, use the money from your other accounts
to pay off the loan from the ninth bank. Repeat this process, and
you will be able to keep the money indefinitely. This process
works if the banks do not charge you interest on the money you
borrow. If they do charge you interest, you can only keep the
money for a limited time. In any case, it is very important to
have a good investment for the money you borrow.
MULTIPLY YOUR MONEY WITH A 'Compensating Account'
You can get a loan from a bank by depositing a "compensating
balance" into an account. In most cases, a compensating balance
amounts to about 20 percent of the loan it is insuring. You may
be able to borrow up to five times the amount you deposit into
the account. Your ability to use this process depends on how good
your credit rating is. If you have a poor credit rating, you may
have to deposit a higher percentage of the loan.
GETTING AN INSTANT LOAN, INTEREST FREE
Mastercard and Visa have a service that allows you to get a free
loan with their special check-writing service.
The check you write is simply billed against your credit card,
and has the effect of an instant loan. You may have a seen this
type of check with your regular statements.
The way to make this loan pay off is to find a bank that accepts
this type of special check with a 30-day grace period. To get an
indefinite loan, write the first special check and do whatever
you want with the money. Then write a second special check and
deposit the money into your checking account. Use this money to
pay back the credit card company. In this way, you may keep the
HOW TO RAISE $50,00 USING YOUR CREDIT CARDS
In today's "credit World" virtually everyone has credit cards.
Millions of Americans carry as many as 30 credit cards, with
credit limits averaging about $1,000 per card. With just your
credit cards, you can get more than $15,000 in cash and
merchandise. even hard-to-get credit cards, like American Express
and Carte Blanche are easy to get once you have cards like
Mastercard and Visa. American Express and Carte Blanche have
limits as high as $20,000. Combining these cards with cards like
Visa and Master Card can give you credit up to $50,000 for 60
days, with no interest.
RAISING MONEY USING DEPARTMENT STORE CARDS
You can use your department store cards to raise quick cash.
Simply go to the stores that have issued you cards and charge
merchandise. A few days later, return the merchandise for
merchandise-credit slips instead of having your account credited.
These slips may be used for future purchases, and they are as
good as cash in those particular stores. Then cancel these credit
slips to your friends and neighbors for a 10-percent discount.
Since this money is to be used for an investment, make sure the
investment will pay higher than 10 percent. If you begin this
plan right after your monthly billing notice, you will have the
use of the money for 60 days and pay no interest to the
SAVE 33.3% ON CREDIT CARD INTEREST CHARGES
In most states, banks are allowed to charge you only 1.5 percent
on unpaid balances of your credit card accounts. This comes out
to 18 percent per year, which is a high interest rate. Because
these states consider them loans, the banks can only charge you 1
percent interest per month. That's 12 percent per year. How can
you use this to your advantage? Make purchases with your credit
cards, and pay off these same purchases with a cash advance. With
this method, you pay for the purchases about 30 days after you
make them and at a rate of only 1 percent per month. You will cut
your credit expenses by one-third using this method.
This method of raising capital requires that you place a
classified ad in the business opportunities section of your
Sunday newspaper. Here are a few examples: Will pay___ percent
interest on small loan for a short period. Sound collateral. Your
name and phone number.
Advertise in the "Business Opportunities" or "Capital Wanted"
sections of the paper. If you live in a small town, put the ad in
a big-town newspaper.
THE CORPORATE METHOD OF RAISING MONEY
You can get money you need by forming a corporation. Besides
being easy to form, there are many advantages. For instances, you
can be authorized to
sell one million shares of stock at no par value when creating
the charter for the corporation.
Let me show you an example of how your corporation will work.
First, issue one million shares of stock once you are authorized
to do so. Keep 300,000 shares for yourself and reserve another
300,000 for future sales to the public. The remaining 400,000
shares should be issued for public sale at about $1 per share. If
you sell 100,000 shares, you will have raised $80,00 after
deducting a 20 percent broker's fee.
In time, your stock may go up to $5 per share. Your stock that
was worth $300,000 will then be worth $1.5 million. You will have
quadrupled the worth of your stock. And this doesn't include the
stock that you reserved for future sale.
You may find this example hard to believe, but the truth is,
people just like you make it work. If you have a worthwhile
venture, this may be your best option.
I must point out one drawback of this method. You must go through
the United States Security Stock Commission in order to
incorporate. For this you will need legal council, which is
expensive. However,many lawyers will accept shares of stock in
your corporation as payment for their service.
DO AWAY WITH SEC REGISTRATION
There is a way to sell and trade stock without going through the
SEC red tape: Price your stock at 10 cents per share and make the
total selling price of the corporation's stock less than $50,000.
These shares are known as penny stock. You may begin by issuing
100-share lots and distributing them to those you feel want to
invest in your venture. Before you know it, you will have raised
thousands of dollars, interest-free, which you will never have to
TAKE OVER AN ON-GOING BUSINESS WITH ZERO CASH
I Have spoken to many people who want to start their own
businesses, and I fully support their efforts.
I believe in learning from others, in not reinventing the wheel.
If you have had a lot of experience in a certain field, you
should have no trouble operating a business related to that
field. But if you have little or no experience in a business, you
have two choices: work for a company to gain experience in the
field you want to enter; or buy an existing business.
To buy a business, you need money. This section will show you how
to buy an existing business inexpensively. Preferably you will
know a great deal about the business you are entering.
To get started, look for a business that is in deep trouble, one
that is almost bankrupt. Many such businesses may be acquired
with little or no down payment. They may be manufacturing
businesses, service businesses, real estate businesses, etc.
Why would someone offer a business for zero cash down?
1. The owner of a failing business wants to get out from under
his bills and headaches.
2. He believes the business is beyond saving.
3. Finding a buyer for a heavily indebted business is extremely
There are always plenty of cash-flow take-overs available,
whatever the state of the economy. These business offers are
often advertised, but you have to look for them. Search through
business ads in newspaper classifieds and trade magazines, check
with local business brokers and with local real estate agents who
also handle business sales.
FIND OUT EVERYTHING
Once you find a suitable firm, learn all its details. For
instance, find out how much the business owes and to whom, the
value of the inventory and all machinery and the value of the
building and the property itself.
Look for a company in which the inventory and assets are higher
than the debts. Also consider the sales income and expenses
required to operate the business profitably. Examine such things
as gross sales, selling and labor costs, taxes owed, etc. This
information may be gathered from the firm's account books, income
tax returns or from an accountants' certified statement.
MAKE YOUR OFFER
Explain your belief to the owner that you can turn the business
around and make it profitable, but that it will take at least two
Here is a typical offer to make the owner of such a business:
Zero cash down
Pay all company debts
No payments for two years
Be sure your lawyer draws up a proper sales agreement before you
buy. You should also make arrangements to pay the attorney's
legal fees from the business funds, not out of your own pocket.
If you find that the owner insists on a nominal down payment,,
you may use any of the capital-raising methods described earlier
to come up with cash. However, you must insist on paying the bulk
of the price with promissory notes.
You must also insist that payments do not begin for a year,
preferably two. You will need that much time to turn the business
around and show a profit.
Once you acquire the sick business, you must take certain steps
to make it profitable. The first step is to deal with the
creditors. Here's what you do.
Set up an appointment with each creditor to discuss the firm's
indebtedness. Explain to each that you have just taken over the
business, and that you would like to pay off all the debts as
soon as possible. Tell them that the business has no cash at the
moment, but that you hope to start showing a profit in six months
to a year. Your strategy is to convince the creditors to accept a
reduced settlement of the debt.
First, try to get a reduction of 30 to 70 percent of the total
debt. You may also insist that payments do not begin for at least
one year. Your third request will be for long-term repayment, 10
years if possible. Once the creditors accept your offer, make it
legal by having them sign agreements. With this maneuver alone,
you will have reduced your debt from 30 to 70 percent, lowered
payments by getting the payoff time extended, and received
complete debt relief for the whole year.
Taking care of the business' debts helps substantially. The
business is then in a far better position to recover from its
ailments, but don't stop there. There are other things you can do
to improve its financial standing, such as:
1. Sell excess inventories: finished goods or raw materials.
2. sell obsolete production machinery
3. Sell more company stock
4. Sell a separate division of your company.
5. Split your company into separate firms and sell stock for
6. Make any cost cuts you can: reduce payroll, find cheaper
supply sources, eliminate waste, etc.
7. Eliminate products, services or accounts that are only
8. Study how to increase sales and locate new markets.
As incredible as it may sound, there are many businesses saved by
using these methods. All too frequently, owners are completely
unaware of the true value of their businesses. In many cases, an
owner has exhausted his operating capital and credit through
mismanagement. Your offer allows him to recoup some of his
investment, and it may be the only one he gets.
THE CORPORATE TAKEOVER
You may use a variation of the promissory-note method offering
the owner corporate stock as a down payment, or even as full
payment if the owner is desperate. Assuming you set up a
corporation with 10 other investors, the owner will be assured of
a sales potential of 10 customers for his stock, once the
business gets going.
HOW TO CREATE SUCCESSFUL LOAN REQUESTS
The proposal you submit for your loan will determine whether or
not the banker will give it to you. The following formula will
show you how to apply successfully for a loan.
On this page, include your name and address and the names and
addresses of any others who are applying jointly with you. This
page goes on the front of the loan request, and it should contain
the title of your request.
LETTER OF REQUEST
This letter may be the most important part of your loan request,
and it will determine if you get the loan.
The letter must get right to the point and tell the loan officer
exactly what he has to know in one or two pages.
The letter should tell the officer:
1. Why you want the loan.
2. How much capital you want.
3. How you propose to pay back the loan.
4. Any personal information that may help you get the loan.
You may obtain a credit application form from any lending
This form, similar to a resume, is very helpful to the lender. It
contains background information about yourself and all your
personal information, such as name, address, height, weight,
marital status, birthdate, etc. It also includes information
about your past four jobs, three references and a complete record
MARKETING PLAN FOR BUSINESS VENTURE
If you try to get a loan for a business venture, this part of
your proposal is one of the most important.
The function of the marketing plan is to show the lender what you
will do with the money loaned you and how you will pay it back.
The marketing plan proves to the lender that you will make a
The following six steps should be taken when creating your
marketing plan. If you have trouble, contact your local SBA
office for assistance.
1. Analyze Your Present Marketing Situation
In order to project your company's future achievements, you must
know where it stands at the present time. In this portion of your
marketing plan, analyze your company's financial resources,
competitive strengths and weaknesses, organizational set-up,
market conditions, experience, management capabilities,
clientele, channels of distribution (how you will distribute your
product) and your competition.
2. Determine Your Marketing Objectives
This step provides guidance and direction for your company. Here,
you tell the lender exactly what you want your company to
achieve. But remember to be specific and make sure that the
numbers can be measured, such as: "Increase the market share of
widgets 10 percent from January 1 to December 31, 1984." You do
not have to know these numbers precisely, but you should make a
rough estimate of what your company can achieve.
3. Assess Your Company's Capabilities
In this step, show the lender how you will use your resources to
reach your objectives. You must show that you have every resource
necessary to reach your objectives, except one: a certain amount
of money. In this step, explain past experiences and
accomplishments that you, your company, or other company officers
have had that could aid the future of your firm.
Also mention anything favorable in Step 1 that may help you reach
your objectives, such as your clientele, receivable, equipment,
4. Create A Marketing Strategy
In this step, show the lender your plan or strategy for meeting
your objectives. This may include continuation or revision of an
existing strategy, or be completely different strategy. A
strategy is a complete plan of how you will best use your
resources to meet your objectives. List each activity you will
perform. It is also important to establish which duties or
activities will be delegated to which person.
5. Put Your Overall Plan On A Time Schedule
In this step, place the activities you have listed in the
previous step on a time schedule. List each activity and show how
long it will take you to complete. You should also show beginning
and completion dates. Do this with all your marketing activities.
The lender not only sees what you plan to do, but how long it
will take you.
6. Control And Evaluate Your Plan
You should have a method of evaluating your process as you follow
your plan. You should be able to control all the proposed
activities and make sure they are on schedule. For examples, if
your objective is to obtain 300 accounts within a 10-mile zone,
your control activity will check that you have done just that.
The control activity will be a monthly record of the number of
accounts you have obtained within the designated 10-mile zone.
Personal financial statements of all persons involved in the
business venture are important to the lender. Current, as well as
projected financial statements, should be included in the loan
request. Projected financial statements are statements that show
how predicted sales will affect future financial conditions. It
is advisable to have an accountant help you prepare your
Statement Of Capital Expenses
This statement shows the lender exactly what you plan to do with
the money he loans you. You should itemize how each dollar he
lends you will be spent.
REAL ESTATE LOANS
Having a professional, independent appraisal of the property is
the first requirement. If possible, include pictures of the
property, as well as maps showing its exact location.
GETTING MONEY FROM VENTURE CAPITAL SOURCES
Venture capital institutions will finance business investments.
And since they assume the risk, they ask for equity in your
business. A conventional source for a business loan takes your
collateral if the business fails and charges you interest on the
loan. What makes venture capital source different? Since they own
part of your business, you don't have to pay them interest.
Venture capital companies invest in companies that they feel will
make them money. They also specialize in certain industries or
fields. You will have to write them to find out where they prefer
to place their money. These companies have fluctuating funds.
There are times when they can loan a lot of money, and others
when they don't have much to spare. Keep writing the same venture
capital companies in your field. You may approach them when they
have a glut of capital to loan out.
It is important that you submit a professional presentation to
these companies. Your chances of getting the funds will be much
greater if you present your case well. Look over the section on
creating a successful loan request. Follow the steps I outlined
for you on your loan presentation. If you do, you have a good
chance getting the money you need.
VENTURE CAPITAL SOURCES
The following companies asked to be listed in this book because
they expressed a desire to finance new or existing ventures.
Write them for more information.
Explorer Fund, Inc.,28 State St.,Boston, MA 02109
State Street Bank Company, 225 Franklin St.,Boston, MA 02110
Paine Venture Fund, Box 73, Boston, MA 02110
Resources & Tech MGT Company, Box 100 Chestnut Hills, MA 02167
Gemini Associates, 234 Pearl St.,Ste One, Hartford, CT 06103
Hartford Comm. Capital Corp.,70 Farmington Ave.,Hartford, CT
The Prospect Company, One Tower Eq.,Hartford, CT 06115
First Conn. S.B.I.C., 177 State St.,Bridgeport, CT 06604
Charter Oak Enter.,CBT Plaza, Darien, CT 06820
Paul Revere Investors, 1275 King St.,Greenwich, CT 06830
Anderson Invest. Com.,49 Locust St.,New Canaan, CT 06840
Wehr & Associates, 4 Forest Dr.,Westport, CT 06880
Western Group, Inc.,Box 1273, Weston, CT 06880
University Capital Corp.,107 Jefferson Ave.,Westfield, NJ 07090
Main Capital Investment Corp.,818 Main St.,Hackensack, NJ 07601
Wall Street Venture Capital, 2 Esterbrook Lane, Cherry Hill, NJ
DSV Associates, 221 Nassau St.,Princeton, NJ 08540
Gunwyn Ventures, 14 Nassau St.,Princeton, NJ 08540
H.J. Morgan Company, 30 W. Prospect St.,East Brunswick, NJ 08816
Schroder Capital Corp.,One State Street, New York, NY 10004
Kalb Voorhis & Com.,27 Williams St.,New York, NY 10005
Loeb Rhodes & Company, 42 Wall Street, New York, NY 10005
American Capital Partners, 261 Madison Ave.,New York, NY 10016
BT Capital Corporation, 600 3rd Ave.,New York, NY 10016
Bancap Corporation, 420 Lexington Ave.,New York, NY 10017
Royal Business Funds, ^ East 43rd St.,New York, NY 10016
R.E. Hart & Com.,Inc.,380 Madison Ave.,New York, NY 10017
Bradford Ventures, LTD.,10 Rockfeller Plaza, #1010, New York, NY
Winthrop Ventures, 527 Madison Ave.,New York, NY 10020
Whitcom Investment Company, 110 W 51st St.,New York, NY 10020
Time Incorporated, 1271 Avenue of the Americas, New York, NY
Rockefeller Bros.,Inc.,30 Rockefeller Plaza, New York, NY 10020
The Franklin Corporation, ONe Rockefeller Plaza, New York, NY
Exxon Enterprises, Inc.,1251 Ave. of the Amer. Rm 4448, New York,
Capital For Future, Inc.,635 Madison Ave.,New York, NY 10022
Technimetrics, Inc.,527 Madison Ave.,New York, NY 10022
Stewart Capital Corp.,485 Madison Ave.,New York, NY 10022
Stewart R. Mott Associates, 515 Madison Ave.,New York, NY 10022
Masco Associates, 437 Madison Ave.,New York, NY 10022
Jacobs Investment Com.,645 Fifth Ave.,New York, NY 10022
Llyod Capital Corporation, 186 Riverside Dr.,New York, NY 10024
Emerging Ventures International, 1350 6th Ave.,New York, NY 10027
R.W. Cross & Company, Inc.,1175 Park Ave.,New York, NY 10028
Midland Capital Corporation, 110 William St.,Rm 2605, New York,
Pioneer Ventures Com.,One Battery Park Plaza, Buffalo, NY 14202
Tait & Legge, 110 Allens Creek Rd.,Rochester, NY 14618
Hillman Company, 2000 Grant Bldg.,Pittsburg, PA 15219
Osher Capital Corp.,Wyncote House 101, Wyncote, PA 19095
Allied Capital Corp.,1625 Eye St.,N.W., Rm. 603, Washington, DC
Columbia Ventures, Inc.,1701 Pennsylvania Ave.,N.W. Washington,
Greater Washington Investors, Inc.,1015 18th St.,N.W. Washington,
Dorset Associates, 135 E. Baltimore St.,Baltimore, MD 21202
Southern Investment Corp.,P.O. Box 6610 Newport News, VA 23606
Montag & Caldwell, Inc.,2901 First National Bank, Atlanta, GA
Southeastern Capital Corporation, 380 Interstate North, Ste 475,
Atlanta, GA 30339
Urban Ventures, Inc.,825 S. Bayshore Blvd.,Miami, FL 33137
Gold Coast Capital Corporation, 3550 Biscayne Blvd.,Miami, FL
North American Company, 111 E. Las Alas Blvd.,Fort Lauderdale, FL
Business Research Company, P.O. Box 2137, Palm Beach, FL 33480
Investment Cap. Corp.,P.O. Box 2069, Montgomery, AL 36103
Standard Growth Capital, Box 10106, Knoxville, TN 37919
Financial Resources, Inc.,1909 Storick Bldg.,Memphis, TN 38103
Community Venture Co.,88 E. Broad St.,Columbus, OH 43215
Dycap, Inc.,88 E. Broad St.,Columbus, OH 43215
American Fletcher Mortgage Co.,606 Madison Ave.,Toledo, OH 43604
Morgenthaler Associates, P.O. Box 91052, Cleveland, OH 44101
Capital Funds Corp.,127 Public Square, Cleveland, OH 44114
Houston & Associate, Inc.,9 Hickory Hollow, Birmingham, MI 48010
Growth Equities, LTD.,2116 Financial Center, Des Moines, IA 50309
Wisconsin Capital Corp.,840 N. 3rd St.,Milwaukee, WI 53202
Commercial Capital Corp.,6001 N. 91st St.,Milwaukee, WI 53225
Eagle Investment Corp.,921 Marquette Ave.,Minneapolis, MN 55402
North Star Industries, 4570 W. 77th St.,minneapolis, MN 55435
Northland Capital Corp.,402 W. 1st Street, Duluth, MN 55802
Vanguard Venture Capital, 301 E. Main St.,Barrington, IL 60010
Venture Capital Corporation, 540 Frontage Rd.,Northfield, IL
Advance Capital Growth Corp.,401 Madison St.,Maywood, IL 60153
William Blair & Co.,135 S. La Salle St.,Chicago, IL 60603
Stewart Capital Corp.,100 S. Wacker Dr.,Rm. 202, Chicago, IL
Atlant/La Salle Capital Corp.,150 S. Wacker Dr.,Chicago, IL 60606
Urban Fund, Inc.,300 N. State St.,Chicago, IL 60610
First Capital Corp.,One First National Plaza, Chicago, IL 60607
Business Capital Corp.,1732 Canal St.,Ste 110, New Orleans, LA
Brittany Corp.,4324 Republic Bank Tower, Dallas, TX 75201]
Venture Adviser, Inc.,2828 Forest Ave.,Dallas, TX 75215
Venture Investment Corp.,714 N. Valley Mills DR.,Waco, TX 76710
Telecom Corporation, Houston Natural Gas Bldg.,Houston, TX 77002
Enterprise Capital Corp.,4635 S.W. Freeway, Rm. 465, W Houston,
Ricky Hicks, 6448 Fannin St,.,Houston, TX 77030
Hixon Ventures Co.,341 Milam Bldg.,San Antonio, TX 78205
Riuss $ Company, Alamo National Bldg.,San Antonio, TX 78205
Cambridge Banking, 1711 Security Life Bldg.,Denver, CO 80202
Denver Coalition Vent.,1711 Pennsylvania, Denver, CO 80202
Venture Associates, 1020 15th St.,Denver, CO 80202
R.W. Halliday Associates, P.O. Box 8508, Boise, ID 83701
Dineh Cooperatives, P.O. Box 569, Chintle, AZ 86503
Capital Manag. Serv.,611 West 6th St.,Los Angeles, CA 90017
Union Venture Corp.,445 S. Figueroa ST.,Los Angeles, CA 90017
Manus, Incorporated, 900 Wilshire Blvd.,Los Angeles, CA 90036
Professional S.B.I.C., 5979 W. 73rd St.,Los Angeles, CA 90036
Goodman & Mautner, LTD.,5250 W. Century Blvd.,Rm 444, Los
Angeles, CA 90045
Brentwood Associates, 11661 San Vincente Blvd.,707, Los Angeles,
Source Capital, Inc.,1888 Century Park East, Los Angeles, CA
Wilshire Cap. Corp.,1000 Santa Monica Blvd.,Los Angeles, CA 90067
Developers Equity Com., 9348 Santa Monica Blvd.,Beverly Hills, CA
The Foothill Group, 9383 Wilshire Blvd.,Beverly Hills, CA 90211
Manning & Com.,29438 Quailwood Dr.,Rancho Palos Ver., CA 90274
H.M. Eldridge, P.O. Box 1983, La Jolla, CA 92037
Alison Promotions, 5834 Soledad Mt. Rd.,La Jolla, CA 92307
Capital City Equity, 811 N. Broadway, Ste 500, Santa Ana, CA
Equity Capital Corp.,25 Cornelia DR.,Hillsborough, CA 94010
Kliener & Perkins, 3000 Sand Hill Rd.,Menlo Park, CA 94025
Menlo Investment Com.,3000 Sand Hill Rd.,Menlo Park, CA 94025
Osco Ventures, 3000 Sand Hill Rd.,Rm 105, Menlo Park, CA 94025
Oak Grove Ventures, 2200 Sand Hill Rd.,Rm 110, Menlo Park, CA
H&R Investment Cap.Co.,801 American St.,San Carlos, CA 94070
General Pacific Inv.,321 10th St.,San Francisco, CA 94103
The Merchants Group, 300 Montgomery St.,Rm. 908, San Francisco,
Rock & Asso., 235 Montgomery St.,Rm. 1635, San Francisco, CA
Opportunity Cap. Corp.,100 California St.,Ste 714, San Francisco,
Bruce A. Blinn & Ass.,415 Merchant St.,San Francisco, CA 94111
Asset Management Com.,1411 Edgewood Dr.,Palo Alto, CA 94301
Hoebich Venture Manag.,860 Hamilton Ave.,Palo Alto, CA 94301
McMorgan & Company, 1000 Welch Rd.,Palo Alto, CA 94304
P.M. Investment Com.,1000 Welch Rd.,Palo Alto, CA 94304
San Fran. Venture Cap, 31285 San Clemente, Hayward, CA 94544
R&D Capital Company, 2700 Merced St.,San Leandro, CA 94577
FMC Corporation, 1185 Coleman Ave.,Box 580, Santa Clara, CA 95052
Delta Invest. Com.,555 Capital Mall, Rm 640, Sacramento, CA 95814
Trail Capital Corp.,1200 Westlake Ave.,North, Seattle, WA 98109
SMALL BUSINESS INVESTMENT COMPANIES
Small business investment companies are privately owned by the
stockholding public. They have good flexibility when giving loans
to businesses, about 90 percent of which are eligible. Each SBIC
has a federal licence to operate under the SBIC Act of 1958. Each
SBIC has their own rules and regulations in regards to loaning.
Here is a list of SBIC's. Write them for information on their
Massachusetts SBIC Inc.,75 Federal Street, Boston, MA 02110
Parker Corp.,265 Franklin St.,Boston, MA 02110
Northeast SBI Corp.,16 Cumber land St.,Boston, MA 02115
Boston Financial & equity, P.O. Box 68, Boston, MA 02215
Pilgrim Capital Corp.,842 A Beacon St.,Boston, MA 02215
Industrial Capital Corp.,111 Westminster St.,providence, RI 02903
New England Investments, 157 High St.,Portland, ME 04101
Manufacturers SBIC, 1488 Chapel St.,New Haven, CT 06510
Nutmeg Capital Corp.,35 Elm St.,New Haven, CT 96510
First Connecticut SBIC, 177 State Street, Bridgeport, CT 06603
All State Venture Capital Corp.,P.O. Box 442, Westport, CT 06603
Engle Investment Co.,35 Essex St.,Hackensack, NJ 07601
Main Capital Company, Inc.,818 Main St.,Hackensack, NJ 07601
CMNY Capital Company, Inc., 77 Water Street, New York, NY 10005
Creative Capital Corp.,214 Mercer St.,New York, NY 10012
Forum Equity Corporation, 214 Mercer St.,New York, NY 10012
New Mexico Capital Corp.,1420 Carlisle Ave.,N.E.,Albuquerque, NM
Great Eastern SBIC, 230 Park Ave.,New York, NY 10017
Basic Capital Corp.,40 West 37th St.,New York, NY 10018
The Franklin Corp.,1410 Broadway, New York, NY 10018
Struthers Capital Corp.,630 Fifth Ave.,New York, NY 10020
Capital For Future, Inc.,635 Madison Ave.,New York, NY 10022
Conresco Corp.,444 Madison Ave.,Ste 3701, New York, NY 10022
Winifield Capital Corp.,237 Mamaroneck Ave.,White Plains, NY
First Westchester Corp.,491 Main St.,New Rochelle, NY 10801
Lake Success Capital Corp.,100 Garden City Plaza, #516, Garden
City, NY 11530
Jefferson Capital Corp.,1228 Wantagh Ave.,Wantagh, NY 11793
Monticello Capital Corp.,34 Norh St.,Monticello, NY 12701
First Pittsburgh SBIC, 1919 Rick Bldg.,Pittsburgh, PA 15219
Sharon SBIC, 385 Shenango Ave.,Sharon, PA 16146
Fidelity America SBIC, 1520 Locust St.,Philadelphia, PA 19102
Delaware Valley SBIC, 1604 Walnut St.,Philadelphia, PA 19103
Philadelphia Ventures, Inc.,1712 Locust St.,Philadelphia, PA
Capital Investment Com.,900 17th St.,N.W.,Washington, DC 20001
Housing Capital Corp.,1133 Fifteenth St.,N.W., Washington, DC
Hudson Investment Co.,1150 17th St.,N.W., Washington, DC 20036
Mortgate Capital Corp.,1925 N. Lynn St.,Arlington, VA 22209
Tidewater SBIC, 300 Boush St.,Norfolk, VA 23510
Charleston Capital Corp.,19 Broad St.,Charleston, SC 29401
Kent Investment Company, 695 E. Wesley Rd.,N.E., Atlanta, GA
Central Florida Investments, P.O. Box 13646, Orlando, FL 32809
First Miami SBIC, 420 Lincoln Rd.,Miami Beach, FL 33139
North Alabama SBIC, P.O. Box 430, Anniston, AL 36201
Financial Resources, Inc.,1909 Sterick Bldg.,Memphis, TN 38103
Financial Opportunities, Inc.,981 S. 3rd St.,Louisville, KY 40201
Associated Investment Com.,320 Associates Bldg.,South Bend, IN
Indiana Capital Corp.,927 S. Harrison St.,Fort Wayne, IN 46802
Financial Investors, 185 Devonshire St.,Boston, MA 46802
Waterfield SBIC, Inc.,123 W. Berry St.,Fort Wayne, IN 46802
Hawaii Econ. Devel. Corp.,P.O. Box 1427 Dillingham Rd.,Honolulu,
J & M Investment Corp.,3044 W. Grand Blvd.,Detroit, MI 48202
Midwest SBIC, 1921 First Natl. Bank Bldg.,Detroit, MI 48226
Mor-America Capital Corp.,200 American Bldg.,Cedar Rapids, IA
Northern States Capital, 330 E. Wilson St.,Madison, WI 53701
Chicago Community Ventures, Inc.,19 S. Lasalle St.,Ste 1114,
Chicago, IL 60603
Minnesota SBIC, P.O. Box 1227, Minneapolis, MN 55440
First Heartland Com. Inc.,405 8th Ave.,N.E., Aberdeen, SD 57401
Berkshire Capital, Inc.,405 8th Ave.,N.E., Aberdeen, SD 57401
Small Business Improvement Co.,P.O. Box 1175, Billings, MT 59103
Abbott Capital Corp.,120 S. La Salle St.,Chicago, IL 60603
Chicago Community Ventures, Inc.,19 S. Lasalle St.,Ste 1114,
Chicago, IL 60603
Vencap Fund, 10 S. La Salle St.,Chicago, IL 60603
Heizner Corp.,20 N. Wackee Dr.,Chicago, IL 60606
The Urban Fund, Inc.,1525 E. 53rd St.,Chicago, IL 60606
Combined Opportunities, Inc.,5050 N. Broadway, Chicago, IL 60640
Funded Investment, Inc.,6430 N. Central, Chicago, IL 60646
North Central Capital Corp.,203 Mulberry St.,Box 998, Rockford,
Century Capital Corp.,250 N. Water St.,Decatur, IL 62523
Atlas SBIC, 1808 Main St.,Kansas City, MO 64108
Midland Business Investments, 122 W. Myrtle St.,Independence, KS
First Small Business Investment, 1614 S. Bayou Dr.,Golden Meadow,
Mid South Capital Corp.,312 Polk St.,Mansfield, LA 71052
Morris Capital Corp.,P.O. Box 20696, Oklahoma City, OK 73120
Investment Capital, Inc.,1301 Main St.,Duncan, OK 73533
First Dallas Capital, Corp.,P.O. Box 6031, Dallas, TX 75222
Central Texas SBIC, P.O. Box 829, Waco, TX 76703
SBIC of Houston, 640 West Bldg.,Houston, TX 77002
South Texas SBIC, 121 S. Main St.,Victoria, TX 77901
Colorado SBIC, Inc.,P.O. Box 5168, Denver, CO 80217
Intermountain Capital Corp.,18 West 3rd S.,Salt Lake City, UT
Utah Capital Corp.,3600 Market St.,Salt Lake City, UT 84119
Val Vista Investment, P.O. Box 619, Phoenix, AZ 85001
Sheffield Industries, Inc.,P.O. Box 24768, Los Angeles, CA 90024
Professional SBIC, 5979 W. Third St.,Los Angeles, CA 90036
First SBIC of California, P.O. Box 2097, Term. Annex, Los
Angeles, CA 90054
City Capital Corp.,9255 Sundet Blvd.,Los Angeles, CA 90069
Havard SBIC, 33 E. Huntington Dr.,Arcadia, CA 91006
Fresno SBIC, 5300 N. Fresno St.,Fresno, CA 91006
Roe Financial Corp.,6100 Kester Ave.,Van Nuys, CA 91401
Downtown Investment Com. 2501 Judah St.,San Francisco, CA 94112
Central Investment Com.,2272 Market St.,San Francisco, CA 94114
Walker States SBIC, 320 Pershing Dr.,Oakland, CA 94611
Merchants Equity Com. 1024 J Street, Sacramento, CA 95814
First Farwest Capital Fund, Inc.,1800 S.W. First, Portland, OR
Oregon SBIC, 661 High St.,N.E.,Salem, OR 97301
Model Capital Corp.,105 14th Ave.,Seattle, WA 98122
PERSONAL AND DEBT LOAN COMPANIES
Following is a list of companies that give personal debt
consolidation loans. some of these companies can offer you
unsecured loans through the mail, with no investigations. You can
even get a loan for more than $25,000 with your signature as
American Express Credit Corp.,401 Hackensack Ave.,Hackensack, NJ
Diners Club, Inc.,10 Columbus Circle, New York, NY 10019
General Electric Credit Corp.,570 Lexington Ave.,New York, NY
Commercial Credit Corporation, 55 Madison Ave.,New York, NY 10022
C.I.T. Financial Coorporation, 650 Madison Ave.,New York, NY
Westinghouse Credit Corp.,933 Penn Ave.,Pittsburgh, PA 15222
Allstate financial Corp.,P.O. Box 2303, Wilmington, DE 19899
Sears Roebuch Acceptance Corp.,P.O. Box 2028, Wilmington, DE
Associates Financial Service Corp.,1030 East Jefferson
Blvd.,South Bend, IN 26617
Credit-Thrift Financial Corp.,601 N.W. 2nd St.,Evansville, IN
S.F.C., 1561 South Green River Rd.,Evansville, IN 47715
Chrysler financial Corp.,900 Tower Dr.,Southfield, MI 48098
Amoco Credit Corp.,P.O. Box 9014, Des Moines, IA 50306
Dial Finance, 418 Seventh Street, Des Moines, IA 50390
Postal Thrift Loans, P.O. Box 448, Sioux City, IA 51102
Honeywell Finance Corporation, Honeywell Plaza, Minneapolis, MN
General Finance Corporation, 1301 Central Ave.,Evanston, IL 60201
Household Finance Corporation, 130 East Randolph Dr.,Chicago, IL
Bankers Investment Co.,Bankers Investment Bldg.,Hutchinson, KS
GAC Executive Service Corp.,2917 South Western Ave.,Oklahoma
City, OK 73109
Allied Finance Corporation, P.O. Box 2998, Dallas, TX 75221
Western Industrial Bank, 2777 South Colorado Blvd.,Denver, CO
Nationwide Finance Corporation, 1660 South Albion St.,Denver, CO
Thomas Knight financial Assoc.,American Building, Ste 245, Salt
Lake City, UT 84101
Whitney Harris financial Oppor.,6800 First Security Bldg.,.salt
Lake City, UT 84101
Transamerica Financial Corp.,1150 South Olive Street, Los
Angeles, CA 90015
Avco Colorado Industrial Bank, P.O. Box 31225, Los Angeles, CA
Carte Blanche Corporation, 3460 Wilshire Blvd.,Los Angeles, CA
Capital Finance Services, 1930 South Hill Street, Oceanside, CA
Avco Financial Corporation, 620 Newport Center Dr.,Newport Beach,
Beneficial Executive Ln.Ser.,2828 Stevens Creek Blvd.,San Jose,
Northwest Acceptance Corporation, P.O. Box 14490, Portland, OR