Capital Credit Account

Credit Score Helps Generate Capital

2008-05-06T12:22:00.000-07:00

Generating capital for your business is highly dependent on your personal credit score. Your Payment History makes up 35% of your entire personal credit score. The other key indicators that make up your credit score are Length of Credit History, New Credit, Types of Credit Used, and Amounts Owed. The percentage breakdown of each in relationship to your personal credit score is as follows:

Payment History 35%
Amounts Owed 30%
Length of Credit History 15%
New Credit 10%
Types of Credit 10%

Each of these areas has specific items associated with it to determine that percentage of your personal credit score. The 30% of your score associated with Amounts Owed is made up of: Amounts Owed

· Amount owing on accounts
· Amount owing on specific types of accounts
· Lack of a specific type of balance, in some cases
· Number of accounts with balances
· Proportion of credit lines used (proportion of balances to total credit limits on certain types of revolving accounts)
· Proportion of installment loan amounts still owing (proportion of balance to original loan amount on certain types of installment loans)

The formulas that create your score look at the averages of consumers and compare you to those. For example with the Amounts Owed section the typical consumer has access to $12,190 on all credit cards combined. More then half of all people with credit cards are using less than 30% of their total credit card limit. Just over 1 in 8 are using 80% of more of their credit card limit. About 48% of credit card holders carry a balance of less than $1,000. About 10% are far less conservative in their use of credit cards and have total card balances in excess of $10,000. When we look at the total of all credit obligations combined (except mortgage loans), 54% of consumers carry less than $5,000 of debt. This includes all credit cards, lines of credit, and loans-everything but mortgages. Nearly 30% carry more than $10,000 of non-mortgage-related debt as reported to the credit bureaus.

Based on your current situation you can see how your score may be higher or lower compared to the average statistics of the general consumer.

Length of Credit History that makes up 15% of your score is determined by:

· Time since accounts opened
· Time since accounts opened, by specific type of account
· Time since account activity

The average consumer's oldest obligation is 13 years old, indicating that he or she has been managing credit for some time. In fact, we found that 1 out of 5 consumers who recently applied for credit, had credit histories of 20 years or longer. Only 1 in 20 consumers had credit histories shorter than 2 years.

New Credit that makes up 10% of your score is determined by:

· Number of recently opened accounts, and proportion of accounts that are recently opened, by type of account
· Number of recent credit inquiries
· Time since recent account opening(s), by type of account
· Time since credit inquiry(s)
· Re-establishment of positive credit history following past payment problems

An important indicator of new credit is inquiries. The number of times someone pulls your personal credit report. When someone applies for a loan or a new credit card account - in short, any time one applies for credit and a lender requests a copy of the credit report - this request is noted as an “inquiry” in the applicant's credit file. The average consumer has had only one inquiry on his or her accounts within the past year. Fewer than 7% had four or more inquiries resulting from a search for new credit.

Types of Credit Used makes up 10% of your score and is:

· Number of (presence, prevalence, and recent information on) various types of accounts (credit cards, retail accounts, installment loans, mortgage, consumer finance accounts, etc.) An average consumer has a total of 11 credit obligations on record at a credit bureau. These include credit cards (such as department store charge cards, gas cards, or bank cards) and installment loans (auto loans, mortgage loans, student loans, etc.). Not included are savings and checking accounts (typically not reported to a credit bureau). Of these 11 credit obligations, 7 are likely to be credit cards and 4 are likely to be installment loans.

Depending on what side of the averages you fall on your score will be higher or lower. Obviously if the average consumer has 11 credit obligations and you have 50, you are likely to have a lower score then someone with 13 with everything else being the same on your credit files.

It is extremely important to manage your personal credit scores and know what your score is at all times. I recommend that you purchase a monitoring service from FairIssac the developer of the formula that tracks your score by going to: www.smallbusinessconsulting.com/fico I recommend it to everyone I know because of the real threat of identity theft and because of the importance of your score in everyday life.

Capital One Secured Credit Cards

2008-05-06T12:20:00.000-07:00

Capital One secured credit cards have broken the mold when it comes to secured credit cards. Instead of ridiculous processing charges and annual fees, Capital One secured credit cards offer credit-bruised consumers with extremely reasonable interest rates and perks that other secured credit cards wouldn't ever think of offering.

The Interest Factor

You'd think that because secured credit cards are backed by money you deposit into an account, the interest rates would be reasonable. Unfortunately, many of the companies that offer secured credit cards could care less how much money you have guaranteeing your account -- they still charge an arm and a leg for interest.

Unlike many other secured credit cards, Capital One secured credit cards actually have very reasonable interest rates. Unlike many other secured credit cards, you won't pay a ridiculous interest rate of 20 percent or more when you have a Capital One secured credit card.

The Application Fee

It's not uncommon for companies offering secured credit cards to charge an application fee. Of course, you usually are only charged this fee if you're approved (and if the company is legitimate, they put the fee on the credit card they are issuing you). However, why pay an application fee for other secured credit cards when Capital One secured credit cards have no application fee attached?

The Credit Limit

When it comes to secured credit cards, the credit limit you're approved for really depends on the amount you deposit into your secured account.

While many secured credit cards offer the ability to get a limit for a thousand dollars or more, Capital One secured credit cards have an initial credit limit of $400. This is, however, for your own good. Capital One secured credit cards are intended to help you rebuild your credit. In order to do that, you need to take it one small step at a time.

So now that you know how much credit you can get with a Capital One secured credit card, you're probably wondering what the minimum deposit amount is to open one. Unlike most secured credit cards, Capital One secured credit cards don't require a few hundred dollars to open your account. In fact, you can deposit as little as $49 when opening your Capital One secured credit card.

Applying

Applying for Capital One secured credit cards is a little different than the other secured credit cards on the market.

Instead of applying for a secured card directly, you should try applying for their regular, unsecured credit card. Many people who think they won't qualify for an unsecured Capital One card actually do. If, however, you don't qualify for the unsecured, Capital One with offer you the secured credit card option.

If you're serious about getting a secured credit card and rebuilding your credit, you can't go wrong with Capital One. Due to their low interest rates, potential perks and lack of an application fee, Capital One secured credit cards are literally changing the way consumers feel about secured credit cards.

Premium Credit Services

2008-03-28T22:54:00.000-07:00

The Capital One Credit Card Company started back in 1995 and over the past ten years, it has become one of the top credit card companies. They offer their services to Canada, the United Kingdom as well as the United States.

The Capital One credit cards offer a variety of cards; enough to suit anyone's credit history and credit needs. They have their premium credit offerings for people who have excellent credit and these cards offer some of the most usable rewards in the credit card business.

The Premium Credit Cards

Capitol One credit cards are for people with excellent credit; Excellent credit meaning a person has had credit for least five years and that the credit card has a limit of at least ten thousand dollars. This person has an excellent track record of making their payments on time.

The Capital One credit cards are available from both MasterCard and Visa, which means the customer can choose their credit company along with their benefit package. Some of the benefits including travel reward miles, cash back rewards and a special annual percentage rate.

For People With A Good Start

For people who have good credit, but not excellent, Capital One also have cards for these people too. These cards also have great reward programs and are available from both MasterCard and Visa. These are known as platinum cards, which mean they will have a credit limit of over $5000 and a low annual percentage rate plus no annual fees in most cases. The platinum cards are perfect for people who already own a credit card with a limit of over $5000 and have held good credit for least five years. These cards are a little more forgiving and will allow their holders to have made a late payment or two in their credit history; as long as it wasn't over two months late.

For Customers Who Need Help Building Credit

Capitol One credit cards will offer cards with smaller spending limits and credit requirements which are easier for people with no credit or who have had problems managing their credit in the past; these cards will often have credit limits under 5,000 dollars.

Because of their limited credit history these cards will charge an annual membership fee, however the customer will still be able to take advantage of rewards programs and build their credit with by making on time payments and gradually getting their credit limit raised as they show their credit worthiness.

Financial needs

2008-03-28T22:45:00.000-07:00

Understanding Invoice Factoring and how it works can change the path of your small Business. Factoring has been practiced for centuries. The Romans sold promissory notes at a discount as did the Phoenicians. The word "factor" comes from Latin, the language of Rome. It means "to do" or "to make." The Pilgrim's journeys to America were financed by advances from a Factor who provided the funds to pay for the journey. The Pilgrims repaid the money with earnings from America. Factoring to this day is an extremely common business practice in Europe whereas many American business men have never heard of it. This year alone thousands of businesses will Factor billions of dollars in accounts receivable, and they are doing it for profit, growth, and in some cases, their very survival.

Factoring is the selling of your accounts receivable for cash versus waiting 30-60 or 90 days to be paid by your customer.

Q: What Is A Factoring Company?
A: A commercial finance company that specializes in the purchase of invoices or accounts receivable for cash.

Q: How do I find a Factoring Company?
A: You could "Google" the word "factoring", however you may not know what companies are best for you. You could ask you Banker, chances are he/she has only one company to refer you to OR you can contact a Receivable Broker or an Invoice Line of Credit Broker or a Cash Flow Consultant. A good (opinion) Broker will not charge you Fees. The Lenders pays the Broker's fees and most Lenders want a Broker to work only with their company. This is great if their company can provide what each client needs. Many Factoring companies do not factor construction or medical invoices. Other Factoring companies require long-term contract. Some Factoring companies can factor up to $10 Million per invoice, a few can factor the large Government Contracts up to $100 Million and still others won't factor anything less then $10,000. One Factoring Company does not fit all Businesses. Clients need a choice, unless of course, the choices are few because of the type of Factoring needed. A good Broker will provide more then one introduction to a Licensed Financial Institution who meet strict standards for providing Accounts Receivable Funding for Government, State, City, County and Business Invoices. A really good Broker will stay with you mentally and emotionally during your entire transaction.

Q: How does factoring differ from bank funding?
A: Factoring companies make decisions based on the credit-worthiness of your customers; a bank makes credit decisions based on your company's financial history, cash flow and collateral. Because factoring is not a loan, no liability appears on your balance sheet. Most importantly, Factoring companies make funding decisions in days or hours-while banks generally take weeks or even months.

Q: Why would a company sell accounts receivable?
A: Companies with recurring cash-flow problems often can't afford to wait 30, 60 or even 90 days for invoice payment. They need cash to meet immediate financial demands of their business. Factoring provides this cash by funding the purchase of accounts receivable, often within 24 hours after invoices are created.

Q: What is the major benefit of factoring?
A: You receive immediate cash. Also-perhaps most importantly-Decision to finance your company is based on your customers' credit-worthiness instead of your balance sheet. If you can deliver the goods and services you have promised to your customers, and if your customers have good credit, you can factor your invoices no matter how limited or problematic your company's financial history.

Q: What does factoring cost?
A: Rates are based on individual and specific circumstances. Factoring rates depend on the credit-worthiness of your customers, your average invoice, average payment cycle, factoring volume and other elements. In general, they would have you believe that cost of factoring is outweighed by its significant benefits: access to immediate cash, credit analysis of your clients, collection work and accounts-receivable reporting.

Bottom Line is, factoring cost and fees are Tax Deductible. Every dime you spend in factoring can be deducted as a business expense. For this reason, factoring can be a good idea.

Cash Reward Facility On Capital Credits

2008-03-14T00:59:00.000-07:00

With the Capital One No Hassle Premium Cash(SM) Rewards Credit Card, you can receive an number of internet account related services and features. It's comforting to know that you can also enjoy no liability for unauthorized transactions. Lost and stolen card reporting is available 24/7. Simply telephone the number on the back of your card. You also get travel and emergency assistance services at your fingertips. Travel accident insurance is a feature of this card as well as there is a program in place for extended warranties for purchases. If you are ever in a jam due to theft or loss you don't have to worry about emergency card replacement as well. There is even a program for emergency cash replacement.

As far as rewards go, you get 1.25 miles for every dollar you spend on purchases. There are no miles expiration for the life of your account even! This gives you the freedom to fly any popular airline you desire, anytime you want, with no blackout dates or restrictions on seating. Capital One currently offers 5 different reward redemption options with this card. These options include travel, cash, merchandise, charitable donations, or gift certificates. You can also enjoy great savings of up to 40% on special featured deals and 10% on everything else at the Capital One Saving Zone on Yahoo! Shopping. With the card's cash rewards program, you can select to get cash back for your miles instead of air travel. Cardholders can also redeem their miles for brand name merchandise and the latest electronics. If you are in a giving mood, you can even donate your miles to charity. A number of different types of goods and services are available via the gift certificate option.

You can also expect exclusive services from the Capital One No Hassle Premium Cash(SM) Rewards Credit Card that you wont find elsewhere like travel assistance service to help you with the small details that can be problematic with getting from here to there and back again. The roadside assistance program is second to none and could come in very handy in the event of a breakdown or road mishap.

The Capital One No Hassle Premium Cash Rewards Credit Card is intended for folks with excellent credit. If you have had a loan or credit card for at least five years, have a credit card with a credit limit greater than $10,000, have never been more than 60 days late on a credit card, medical bill, or loan payment, and have never declared bankruptcy, The Capital One No Hassle Premium Cash Rewards Credit Card might be right for you.

Please do note that at the time this review was written all the information presented was true and current to the best of my knowledge. Before you apply online for this, or any other credit card it is important to read the most current terms and conditions of the offer from the provider's website or current literature.

Interest Factors On Secured Capital Credit Facility

2008-03-14T00:57:00.000-07:00

essential Capital Credit Requirement

2008-02-24T18:56:00.000-08:00

Raising sufficient working capital is an essential requirement for any business start-up. Moreover running a small business often calls for the need of a financial boost at times of crisis. The business cash flow can be disrupted due to various unforeseen reasons. Payment of dues, purchase of new equipment or starting new business venture might cause additional disruption in cash flow particularly of a small business. There are plenty of options for choosing the right service to acquire this capital, and this process could be quite confusing. The mode of financing is an important element that determines the success of the organization and thus an exhaustive understanding of the available funding options is almost mandatory.

Business cash advance is one of the most popular modes of acquiring essential business finance. It is almost similar to a payday loan. However, payday loan requires an individual to provide proof of employment and salary whereas business cash advance is perfect for an entrepreneur to get funds when he lacks perfect credit or doesn’t have the ability to get funds by other means. The only requirement of business cash advance is that the business should accept credit transactions, i.e. it should allow it’s customers to pay with visa or master cards. It is just an advance and not a loan; hence every time the business receives a payment, a part of it is automatically forwarded to meet the repayment of advance.

Working capital loan, another great way of acquiring funds is the traditional and most commonly followed method by most small business. However, it is not as easy to get funded in this mode as compared to business cash advance. Working capital loan is difficult to qualify for when compared with business cash advance as an alternative source for working capital financing. The credit score of the borrower, the available collateral and various factors are carefully considered before acceptance of working capital loan. However, most small businesses would easily qualify for a business cash advance.

Getting a working capital loan involves a lot of paperwork and quite some time. However, it is not the same for business cash advance. Business cash advance is processed much faster and it involves relatively less paperwork, thus simplifying the process of working capital financing. Moreover a business cash advance does not have a fixed repayment schedule as the case is with working capital loan. The repayment is done from credit card sales receipts and the businesses generally do not feel the pinch. However in case of working capital loan, if the borrower fails to repay the working capital loan, it might not only affect his credit score but also poses a threat of losing his collateral. Irrespective of the business volume on a particular month the borrower will need to repay the working capital loan according to the pre determined fixed amount.

Considering all these, it could be well concluded that a business cash advance is much easier option for an entrepreneur to acquire working capital financing.

Solution For Capital Credit Policy

2008-02-24T18:41:00.000-08:00

If you are a business owner and you often find yourself needing a temporary source of capital, a line of credit, or LOC, may be the solution you are looking for. Business lines of credit are provided by banks to give businesses temporary capital and an instant source of cash to use as business needs arise.

When applying for your LOC, keep in mind that the bank will likely want to know on which occasions you intend on using it. While it is a relatively common practice for an LOC to be a part of the package of credit facilities offered to the average business, the bank will still need to know on which circumstances you are looking to require use of the line.

It is strongly recommended to be fully-prepared with sound documentation prior to meeting with your lender.

If you are preparing a financial analysis to present to your banker before applying for the line of credit, bear this important point in mind: In terms of analyzing your repayment capacity, the bank will not include the principal payments that you make on the line of credit in its total debt service calculation.

This means that the burden the line of credit will have on your debt ratios may not be as great as it may seem at first.

So, for example, on a $100,000 line of credit at a variable rate equal to the Wall Street Journal Prime Rate + 2.00%, the bank will only calculate the projected interest payments on that debt when looking at the debt side of your calculation. Let's say that it is assumed, in the worst-case scenario, that the entire $100,000 will be loaned out for an entire year, with pay-downs from time-to-time. In this case, let's also assume an average interest rate over that time of 10.00%. So, in terms of calculating the total debt service paid on this line of credit the bank will arrive at a figure of $100,000 * 10.00%, or $10,000. Just the interest expense is added to your total debt service payment projection, not any "principal" payments you make as you pay down the line of credit.

One word of caution: Do not let business lines of credit become crutches that are used to fund permanent expenses. These lines are best utilized as temporary financial instruments that cover short-term cash flow needs. Once your receivables are paid to you or cash comes in from another source, use this inflow to pay your line to $0.

It is strongly recommended to only use the line of credit for short-term capital needs and to pay it down in a timely fashion. This is the intent of the line of credit, and in many cases, a commercial bank will require that a business convert this short-term line of credit debt into a long-term loan if it is not utilized in a way that the bank sees proper. In general, a bank doesn't want a business to use a line of credit as though it were a term loan, and if the business does this in many cases the bank will simply require that the line of credit be eliminated and fully converted into a term loan.

This means that the more you can pay your line to $0 after using it, the better you will look in the eyes of your banker, as it will prove that you are handling the line of credit in a responsible manner. Business lines of credit are excellent tools for business owners to manage their cash flow, but care needs to be taken in making sure the lines of credit are handled in a way that the financial institution sees as satisfactory.

You are welcome to share this report in its entirety and unedited. All links must remain intact. No information in this report should be interpreted as advice, as the report is meant for informational purposes only.

Tom Kirchmann is the author of the soon-to-be-released multimedia guide called Business Financing Secrets, where he will reveal the simple steps entrepreneurs can take to obtain favorable business financing based on time-honored banking principles.

Right now you can get your free copy of the valuable report, "The Preparation Principle," where Tom explains the most important factor of all in obtaining business financing.