New Century Financial

As cities across the United States begin to come out from a state of quarantine, businesses are reopening. Due to businesses restricting or halting commerce during the COVID-19 pandemic, catching up on revenue is a top priority. However, business recovery will be challenging without a way to ensure strong cash flow and fast access to capital.

Lenders Are Tightening Requirements

As the economy contracted during the pandemic, lenders started tightening their requirements for loans. The minimums for both collateral and credit ratings increased, while the amount offered for loans decreased. This trend is expected to continue through the business recovery period, as lenders attempt to minimize their own risk and place most of the burden on the borrowers. At the same time, businesses need access to working capital to get back up and running, but taking on extra debt to accomplish is not a desired course of action.

Businesses continue to evolve, most often spurred on by external influences. The COVID-19 pandemic forced many businesses to rethink operations, and many entrepreneurs took their companies online to reduce potential health risks to their employees and their customers. By moving operations online, businesses found they could reach a wider audience. Businesses that once relied on local clients were suddenly tapping into demand, statewide, nationally, and even globally. They also discovered the sales side of e-commerce moves at a much faster pace than traditional sales. However, faster sales do not always translate to improved cash flow. Fortunately, there is a way to bring parity to online businesses.

Old-Fashioned Methods and the Digital Age

Technology may have advanced tremendously over the past few years, but standard business practices have remained the same. Employees still get paid on a regular schedule, bank

Debtor-in-Possession financing (or DIP financing) is an often overlooked solution for businesses that are facing bankruptcy or restructuring. DIP financing is an essential way to keep distressed businesses cash-fluid while they are going through the Chapter 11 process. How DIP Financing Works At its heart, DIP financing is extended credit designed to meet the working capital needs of businesses that are seeking bankruptcy protection. DIP financing provides businesses with immediate cash to sustain operations and maintain liquidity throughout their reorganization during bankruptcy. Why Access to DIP Financing is Important Debtor-in-Possession financing is nothing new, but the need for DIP financing has come to the forefront. The COVID-19 pandemic led to many businesses downsizing, and some had to put operations on hold for months. As the pandemic stretched into the second, third, and likely fourth-quarter of 2020, some businesses could not sustain themselves, e

COVID-19 is an ongoing challenge facing businesses, but entrepreneurs are finding ways to adapt. Some brick-and-mortar businesses are reducing foot traffic, or moving operations completely to online platforms. Others are taking extra precautions to keep customers and employees safe. Throughout all of this, businesses still need financing, but some predatory lending practices have come to the forefront. How can businesses avoid predatory lenders during a pandemic and get the financing they need?

1. Compare lenders before applying for financing

Many lenders seem to offer similar financing programs, but there are often details that get overlooked. Interest rates, origination fees, loan amounts, and more can mean the difference between legitimate and predatory lending practices. Read reviews from other borrowers and talk to the lenders directly. Since you are looking for financing for your business, you are in contro

Financing is a primary concern for businesses throughout the United States. While stimulus and relief packages have come and gone in the ongoing COVID-19 pandemic, businesses are looking for something more permanent, but with more flexibility than traditional loans. Fortunately, there is a financing solution that is a perfect fit for a wide range of businesses.

Business Financing and Loans

Loans were once the “go-to” financing plan for businesses in all industries. Over the years – and especially now – that attitude has changed. Paycheck Protection Program (PPP) loans were suspended last August, and many businesses that received them may not be able to take advantage of the loan forgiveness part of PPP loans. So with PPP loans up in the air, some businesses are looking to secure other traditional loans, only to be met with more obstacles. PPP loans were a mad rush because it wasn’t the banks’ money on