by My Commercial Capital | May 26, 2023 | Blog
Many buildings can only house between one and four families or dwellers, and these are commonly referred to as one-to-fours. When a building can accommodate five or more residents, it is classified as an apartment building. These kinds of dwellings call for somewhat different underwriting and will generally require a stricter standard when it comes to qualifying for a purchase loan. One major difference is that lenders tend to take a hard look at any previous experience you’ve had managing multi-family dwellings, whether they were apartment buildings or one-to-fours. As you can see there are many variables that need to be taken into consideration while investing in Multi-Family Apartments, read on to learn more about how investing in this type of property works.
Investing in an multi-family apartments
There are some fairly standard qualifications that lenders will closely check with applicants requesting a loan for a multi-family dwelling. Here are some of the things that a lender will check on:
- Debt service coverage – this measures your current cash flow against your debt payment obligations. If you’ve had difficulty making payments on time, it will signal a lender that you may not be able to repay a loan to them.
- Loan-to-value ratio – this compares the amount of the loan to the total value of the property. Obviously, you don’t want the amount of the loan to be significantly more than the property value, so choose a property with high value that will compare favorably with the loan amount.
- Net operating income – this figure is arrived at by subtracting all expenses from the total amount of income the property brings in annually. The ideal net operating income will be a figure where the income is much greater than expenses, which bodes well for future stability.
Investing in an apartment building?
There can be some significant benefits to investing in multi-family apartments, but they also call for a significant initial outlay. If you’re in need of funding to secure an apartment building, we may be able to provide financial assistance. Contact us at My Commercial Capital, so we can discuss your eligibility for a loan that will help you to close the deal.
by My Commercial Capital | May 23, 2023 | Blog
Human resources managers work hard at finding the right applicant for an open position. Between crafting an ideal job posting reviewing resumes and performing initial interviews, finding the right candidate is a time-consuming process. More and more employers are focusing their time on understanding the soft skills that an applicant brings to the organization.
Treating the onboarding process as a marketing strategy, helps you develop the best hiring practices for your business.
One of the most effective ways to guarantee long-term employees is to make sure the employee fits into your company’s culture. Personality tests help you identify the soft skills of applicants. The results help you predict how the candidate’s character will fit in with the rest of the company. Here are some ideas on implementing personality assessments.
Test Current Employees
Marketing analysis asks you to identify the strengths and weaknesses of your company as a whole. When you apply this concept to the skills and talents of your staff, you can build more effective teams. Ask all employees to take the personality assessment and determine what soft skills are needed for each role in the company. With this information, you can re-organize teams based on the employees’ strengths and the manager’s management style.
Screen All Applicants
All applicants should complete the personality assessment test early in the screening process. Prioritize interviews based on applicants’ scores in defined skill categories. Develop interview questions based on the talents needed for the position. For example, if time management is a critical skill, ask applicants how they prioritize and schedule their workday.
Tailor the Job
Personality assessments should not be used to build a cookie-cutter staff. As you understand the personality, learning style, and motivation techniques of each applicant, you may find the candidate is a better fit in a different department. For instance, you may find a candidate that prefers variety in their workload. Perhaps cross-training them between the marketing and bookkeeping departments helps them to be a more successful employee.
Motivate Your Employees
Upon hiring the candidate, review personality assessment information to better understand the employee. Properly motivating employees and job satisfaction will soar. For example, understanding that an employee prefers verbal praise over written praise allows you to build a stronger relationship with them.
Implementing personality assessments and incorporating them into the hiring process can be a time-consuming endeavor. However, once you have a system in place, you will see the benefits of adding this tool to your hiring process.
by My Commercial Capital | May 19, 2023 | Blog
As most small business owners know, the federal government does not itself issue loans to applicants, but they do guarantee such loans up to about 85% of the value of the loan. This makes lenders much more willing to approve a loan request than they would be without government backing. In the case of an SBA 504 loan, loans are used to support the economic development of a given community. Thus, if you were to open up a new physical therapy clinic in your community, it would be seen as a good step in community development, and you might be eligible for a 504 loan. Continue reading to learn more about how SBA 504 loans work.
How an SBA 504 loan works
SBA 504 loans are long-term loans that offer fixed-rate financing for the purpose of acquiring or updating assets like real estate, or perhaps to purchase needed equipment for your business. The maximum amount of money you could borrow under this program is $5.5 million, and they have their own standard structure. Loans like this are usually funded to about 40% by the government, 50% by a lender, and 10% by the borrower. Keep in mind that the SBA will only fund this kind of loan if you can demonstrate that it will provide some long-term benefit to the community.
The duration of 504 loans can be for either 10, 20, or 25 years, and the interest rate will be tied to the five or ten-year rate of US Treasury notes. This typically amounts to about 3% of the amount being financed. In most cases, it will be necessary to come up with a 10% down payment, although there are certain cases where this amount will be higher. You can expect to pay several fees, including SBA and CDC fees, as well as the bank fees associated with the loan.
Looking for an SBA 504 loan?
Not everyone offers SBA 504 loans, so you’ll probably have a limited number of lenders you can work with to secure one of these loans. Contact us at My Commercial Capital if you’re in need of a 504 loan and want to work with a reliable and trustworthy lender.
by My Commercial Capital | May 12, 2023 | Blog
Each year, when the calendar reaches the end of December, some small business owners go into a mini-panic, recognizing that tax time is right around the corner. If you’re totally unprepared for it, tax time can be a nightmare, but if you’ve been observing some good practices throughout the year, your accountant may not have much trouble in filing your taxes and keeping your current. Here are some recommendations on how to prepare for that all-important tax time, so you don’t have to dread it every year.
Preparing for tax time
By taking the steps below, you should be well-prepared for tax time, which means you won’t have to dread it when it comes:
- Get organized – throughout the calendar year, you should be organizing your expenses, invoices, and business statements so they’re all accessible and ready to support your tax claims
- Bank reconciliations – make sure all your banking transactions have corresponding entries in your accounting system. This should be done each month, so it’s not a mammoth task at the end of the year.
- Quarterly payments – if you’ve made quarterly payments this past year, these will need to be compared to your end-of-year statement. When your books are fully reconciled, you’ll have no trouble preparing year-end statements accurately.
- Prepare W9 documents – if you’ve done business with contractors in this tax year, you’ll need to prepare the mandatory W9 statements, provided that your contractors earned more than $600 from your business.
- Start early – it’s never a good idea to wait until tax season to contact your accountant. By getting an early start, you can be sure that you’ve allowed enough time to handle any issues that come up, and you can be sure of booking time with your accountant.
Owe money on your taxes?
Many small business owners find that at the end of a tax year, they owe the government money, and this just isn’t budgeted for. To cover this shortfall, you may want to apply for some kind of business loan that will keep you current with the federal, state, or local tax agencies. Contact us at My Commercial Capital if you’re in need of financial assistance to cover your tax responsibilities.
by My Commercial Capital | May 5, 2023 | Blog
For entrepreneurs starting up new businesses or taking their companies to the next level, effective time management is essential. Time is a valuable asset, and too often it seems you don’t have enough of it when you measure it against everything that needs to be done. However, you can use your time more efficiently by adopting these tried and proven time management strategies.
Clarify Your Goals
As an entrepreneur, you may have numerous goals in mind for your business. One of the first things you should do is list these in order of priority. As you consider the goals, you will realize that some are essential while others are desirable but of obviously lesser importance.
Prioritize What Pays
At the top of your list of goals should be tasks that pay off in funds to run your business. If you are deciding between various project options, first take on the one that brings in the most income for the least amount of effort.
Plan Ahead
Once you have settled on your short-term and long-term goals, prepare a plan for their accomplishment. Break up larger projects into several intermediate milestones that will mark your way towards ultimate fulfillment.
Do the Most Urgent Tasks First
Many people obtain satisfaction from accomplishing numerous smaller items on their checklists, but for entrepreneurs this is inefficient time management. Instead, always tackle the biggest, most urgent task first. See this task through to completion, and then go on to the next urgent task. Remember that the quality of what you get done is far more important than the quantity.
Set Deadlines
Deadlines are an important factor in your time management strategy. Estimate how long it should take you to finish important tasks, and set realistic but challenging deadlines for their accomplishment. These time constraints will spur you to focus better and work harder.
For more tips on time management for entrepreneurs, get in touch with My Commercial Capital.
