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Asset-Based
Lending. How to Establish a Revolving Line of Credit Through First Aarans Financial.
Similar to factoring in many ways,
asset-based loans are those credit facilities granted borrowers using
account receivable and inventories as the primary collateral. Unlike
factoring arrangements, however, which result in the sale of your
accounts receivable, asset-based credit facilities are always structured
as loans.
Though we are primarily consultants in
commercial factoring, at First Aarans Financial, asset-based lending
relationships are maintained with some of the largest lending facilities
in the nation. In addition to assisting you in selecting the
appropriate lending institution, we can often provide your company with
mezzanine (temporary) financing to bridge the gap while changing lenders
or during capital intensive times.
Criteria for asset-based lending and
establishing revolving lines of credit are substantially different than
factoring. To establish credit lines
with our lenders, your company must:
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have well established credit with few
derogatory experiences.
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be seeking at least $500,000.
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have substantial collateral with at least
2-1 coverage.
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have at least a three year experience of
profitability.
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have audited financial statements.
One of the most popular methods of securing
asset-based loans is to receive a loan guarantee for the
United States Small Business
Administration or SBA. To further
explore what the SBA can provide you, visit this government site by
clicking the above link or
contact us at
First Aarans Financial.
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Inventory Finance
Inventory Loans are generally structures as asset-based loans or
revolving lines of credit.
While traditional revolving
lines of credit can be difficult to obtain due to credit considerations,
factoring can often provide the necessary capital to increase inventory
for both seasonal sales and normal expansion.
At
First Aarans Financial, we maintain relationships with some of America's top inventory
lenders and capital providers. |
