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Practical Tips to Help You Get Started with Fix and Flip Investing

Practical Tips to Help You Get Started with Fix and Flip Investing

There are a number of practical ways to get started as an investor in the real estate market. For countless individuals, following the fix-and-flip method has proven to be the most rewarding. With this model, you purchase a piece of residential property that requires a bit of work before it can be sold to a prospective homeowner. Since renovations are required, real estate usually costs significantly less than a dwelling that is in perfect shape. Naturally, there are several points to keep in mind with this process. Review these tips to get the most from your experience.

Thoroughly Understand the Current Market

Before you invest in a piece of property, you should become familiar with everything there is to know about your local market. Which neighborhoods are currently the most appealing to buyers and which as poised to be up-and-coming spots in the near future? Do you need specific permits to conduct renovations in this area? If so, how long does it take to acquire these documents? Having the answers to these questions ready to go before you break ground will help you avoid any major snags as you begin work on your investment property.

Learn About Financing Services

Financing is another area to focus on when it comes to fix and flip investments. While these properties do cost less than a traditional piece of real estate, you will still need to put down a significant chunk of change in order to obtain the most profitable pieces of land. When you’re just starting out, you likely don’t have as much capital to work with as someone who has been in the industry for several years. Thankfully, you can boost your cash flow by looking at traditional options like bank loans or alternative financing services like SBA funds.

Know the Exact Costs of Flipping

Finally, be sure you understand how much work will be involved in fixing a piece of property before you make your final decision. Real estate that costs significantly less than market value might seem enticing, but that means you might have to sink a lot of cash into the renovations. The more you spend, the more likely it is you will not see a profit. Be sure to account for expenses that fall outside of the renovation process, too. Everything from legal fees to the costs of hiring an inspector should be factored into the total.

The fix-and-flip process of purchasing real estate can yield a number of benefits for investors. As long as you understand the ins and outs of the flipping process, you should be able to see the results that you are after.

How to Start a Small Business

How to Start a Small Business

Running a small business isn’t easy and comes with its fair share of challenges. That being said, if you approach your new venture with the right attitude and mindset, there is a good chance you can make it work in your favor. If you’re on a tight budget and don’t have too many financial resources at your disposal, these small business tips should help you get started on the right foot.

Hire the Right People

Hiring the right employees is an important part of keeping your small business on track. When you are just getting started, it may not be possible to offer competitive salaries and benefits packages. You will probably have to hire people who are willing to work for less money than they could earn in other fields. If you have the ability to find and hire great people, though, you’ll have a competitive advantage over other small businesses that can’t afford to hire the best talent.

Have a Growth Mindset

Your small business will likely need to grow at some point in its lifespan. You may decide to scale up your operations or find ways to increase your earnings with the help of contractors. You’ll probably have to deal with a few challenges along the way. While keeping a positive mindset and maintaining a growth mindset will help you overcome such challenges, it will also help you succeed in other areas. It is much easier to attract investors and partners when they see that you’re willing to take calculated risks to grow your business.

Don’t Skimp on Marketing

Marketing is an important investment that will help you generate more customers. If you’re able to find ways to cut corners elsewhere, you can easily make up for the costs of marketing with a few successful campaigns. It’s not always easy to know where to start when it comes to marketing. You can take a look at some of the best marketing campaigns of all time to get some inspiration. You can also hire a marketing consultant to help you come up with an effective marketing plan. Whatever you do, make sure that your marketing efforts are consistent with your brand.

It’s not easy to start your own business but the rewards can make it all worthwhile. Make sure you’re prepared for some challenges and sacrifices before taking the leap. By following these small business tips, you may find success.

Beat the Competition With These 3 Social Media Strategies

Beat the Competition With These 3 Social Media Strategies

In today’s digital marketing world, it can seem nearly impossible for your business to stand out from the crowd. After all, the advent of the internet made it possible for millions of other like-minded businesses to not only saturate your field in the online market, but to reel, the customers, you’re so desperately seeking for your own company.

Thankfully, however, there are proven strategies that can help you gain the upper hand. Here are three social media marketing techniques you can embrace for your own company to not only gain a wider audience and generate more leads but to maintain a loyal brand community for years to come.

1. Design a Well-Crafted, Long-Term Branding Campaign

When you’re trying to lure in new customers, sending out content in various forms across your social media pages is key. However, this doesn’t mean you should just send through haphazard, random materials without a plan in mind. Take the time to flesh out a highly-detailed marketing plan that acts as a mastermind or backbone for your long-term goals. Make sure every component showcases your brand’s mission, values, and principles so that they contain a singular message for your audience. Meanwhile, while visual aids are undoubtedly important, don’t go overboard with styles and designs that will confuse your potential customers. Keep it beautiful yet simple, and interject explainer videos whenever possible for a greater boost in lead generation.

2. Use Your Employees and Company Culture for Brand Awareness 

Your hard-working, dependable team of employees does everything for the sake of the company’s success. Therefore, why not encourage them to become brand ambassadors as part of your social media marketing strategy? Having individuals within your business posting, sharing, and promoting brand materials can help circulate and spread awareness of your brand to a larger audience for greater lead generation results.

3. Engage With Your Customers On a Personal Level

With so many similar businesses sending out ad after ad looking to make a sale, customers are well-aware of sleazy marketing tactics that ask for nothing but their money. Therefore, it’s important to engage with your audience one-on-one to build a deeper, more personalized connection that leaves a lasting impression. Use data and social listening tools to address the needs of your followers. Monitor your online reputation and respond to those who have had a bad experience with a positive approach for better customer service. 

With these clever social media marketing strategies in mind, you can learn to quickly improve your company’s outreach in no time, helping you to stand out from your competitors with ease. Contact WHW Capital to learn more about how social media strategies can boost your business.

How to Best Manage the Cash Flow of Your Small Business

How to Best Manage the Cash Flow of Your Small Business

Working capital is essential for businesses of any size to see continued success. When you operate a small company, however, it can prove more difficult to manage your cash flow. Since you require capital to cover everything from paying your monthly expenses to investing in future opportunities for growth, you need to remain mindful of your spending habits at all times. Look over these suggestions and gain a better understanding of how to appropriately manage the flow of cash for your small business.

Pay Attention to Your Receivables

Maintaining strong relationships with your customers is important for your brand to stay afloat. Unfortunately, this also means you might look the other way when it comes to the negative behaviors your client’s exhibit. If customers are not paying for the services or goods you’ve provided in a timely manner, it can have a significant impact on your access to capital. To encourage prompt payments, consider tactics like requesting deposits on large orders to switching to an electronic method of billing. Accounts receivable financing services can also prove useful when payments become significantly delayed.

Open a Credit Line

Having funds available for emergencies can be a lifesaver for your small business. One simple way to guarantee a financial safety net is by opening a line of credit. Unlike loans, which are delivered as a lump sum and must be repaid immediately, a credit line can be used at your leisure. Should your cash flow stall, you can utilize your line of credit to cover any pressing expenses that come about. Some credit lines also come with perks for how often you use them, so conduct heavy research into your options in order to discover the most rewarding fit.

Prioritize Your Payments

There are a ton of monthly expenses connected with running a small business. Though it can seem like all of these costs hold equal importance, some are actually more pressing than others. To avoid spending all of your working capital in one swing, prioritize your payments and handle them as the funds become available. Payroll should always be covered right away, for example. Other expenses like paying your internet provider are a bit more flexible, with most larger companies allowing clients the option of moving payment dates to a time that works best for them.

In order for your small business to stay one step ahead, you must have a plan for managing your cash flow. By establishing a strategy early, you can guarantee access to working capital at all times.

How Can Factoring Affect Credit Scores?

How Can Factoring Affect Credit Scores?

Business owners often have two types of credit riding on the company’s success: personal credit scores and business credit histories. Leveraging your personal credit on starting your business is typical; your company does not have a credit profile yet, but struggling to pay business bills on time should not hinder your ability to refinance your mortgage or buy a new car. With invoice factoring or accounts receivable financing, you can make reliable payments on time to build your business credit profile and repair your personal credit history.

About Business and Personal Credit Scores

Your credit profile, business or personal, depends mainly on successfully repaying debt on time and not using too much of your credit at once. For instance, if your credit card has a limit of three thousand dollars, you do not spend more than one thousand dollars monthly. If you pay the bill in full and on time, your profile will show more favorably than if you have a limit of three thousand dollars, are constantly at the limit and skip one in four payments. If your business has less than three years of credit history, you are unlikely to have a robust profile and may need to leverage personal credit to finance large purchases.

Working With a Factor

Factoring, or A/R financing, involves working with a third-party lender, called a Factor, and securing an advance with your invoices as collateral. This process means that you will leverage future payments for work already done to get cash in time for your monthly bills. The fee for this financing type is generally low, and you can receive a large percentage of the invoice value as an advance. The remaining value is held as a reserve, and part of that reserve will be the financing fee.

Boosting Your Credit Profiles

You can use A/R financing to boost your credit profiles by paying your bills on time, increasing your capital for better cash flow, or saving for large purchases. This funding can boost your personal credit score because any loans you have taken out for your company will be repaid promptly, and it can increase your business credit history by showing a steady repayment of debt.

Factoring is an excellent way to get the funding you need in the short term to take advantage of time-sensitive deals, purchase the supplies you need for future projects and repay the business debt on time. This practice can boost your credit profile and help you qualify for everything from a business line of credit to a mortgage loan.

Financing Real Estate Purchases for Small Businesses

Financing Real Estate Purchases for Small Businesses

Real estate financing is an especially complicated world, even for investment and financing professionals. There are literally dozens of products designed to help investors purchase commercial real estate, in addition to programs aimed at companies buying operational facilities and individuals seeking out personal property for various reasons. It’s no wonder so many people wind up confused when they first look for a loan. When your small company is buying a building, it will operate out of, there are a few relatively simple options that will suit you best, and you do not need to worry about understanding the other choices.

Commercial Mortgages

This loan type is simple in structure, but approval processes for commercial mortgage programs can still be complicated. It resembles a home mortgage, with the key differences being that the version aimed at commercial real estate financing has higher interest rates, lower LTVs, and application requirements that include a complete business plan as well as the expected financial screening. Among the additional requirements is an operating history with at least two years of consistent profitability leading up to the present day. Not many startups or small businesses can meet those criteria when they need the loans most.

SBA Loans

When it comes to the costs and the month-to-month payment requirements, SBA loans are very similar to commercial mortgages. The biggest difference is that the SBA loan package is partially guaranteed by the government to mitigate lender risk. It is also more flexible about using an owner’s personal credit and income to qualify for the loan, whereas commercial mortgages tend to require the company to be able to stand on its own. Buying commercial real estate with SBA loans may require you to meet additional criteria like enriching the local economy through job growth or foregoing early repayment for a time.

Bridge Loans for Property Purchases

If you need fast approval and low monthly payments so you can rehabilitate a property before moving into it, a short-term bridge loan based on the new asset’s value could buy you the time and space you need to make improvements. That allows you to finance the commercial real estate purchase for the improved value when you apply for a commercial mortgage, which could be the best option in the end if you are doing something like remodeling and reopening a hotel. Keep these options in mind when you consider your next real estate purchase.

Finance Your Invoices, or Finance Your Purchase Orders?

Finance Your Invoices, or Finance Your Purchase Orders?

Finding the working capital you need to take on challenging orders can be tough, but there are options that you can tap into your business assets. This sidesteps the lengthy approval processes for traditional loans and in some cases, the cash advance does not even appear on a credit report. For businesses that use purchase orders and invoice billing, the question of which asset to finance often comes up. Understanding when each one is best used will help you to get the most out of purchase order financing.

Consider Your Capital Needs

If you need general operating capital to meet your regular obligations, you might want to lean toward AR financing. By sending out all your invoices at once, you stand to get a larger advance than if you finance all your purchase orders, at least in most cases. If you do not have a lot of unpaid invoices but have recently gotten a lot of orders, then the situation is reversed and you’re going to want to finance those orders.

When you need money to take on the orders themselves without disrupting your other cash flow obligations, that is generally when purchase order financing works best. You can finance a large rush order with its own value, allowing you to isolate its costs and profits from the general flow of business. The result is a windfall opportunity that does not disrupt your regular processes.

In some cases, you may even want to finance both purchase orders and invoices to raise as much capital as possible at once. You would need to apply for each separately, but nothing stops you from using both if you qualify.

Who Can Use Purchase Order Financing?

Invoice financing is the more popular choice in large part because it is accessible to a wider range of companies. Almost every company that uses purchase orders also uses invoice billing for at least some of its transactions. Only a fraction of the companies that use invoice billing use purchase orders, however. That asset tends to be limited to manufacturing and import trade companies, with a few rare exceptions in other areas.

Make the Most of Your Business Assets

The best cash management solutions are the ones that make use of all the available tools at your disposal. That means you should work out a strategy for financing your working capital needs with options for everyday cash management, rush orders, repair and maintenance emergencies, and industry-specific key need categories. That way, you’ll know exactly when to use purchase order financing and when to opt into another financial product.

3 Differences Between MCAs and Business Loans

3 Differences Between MCAs and Business Loans

If your business relies on credit and debit transactions for a lot of its income, you probably already know you can finance your merchant account income to access a cash advance when you need working capital. The big question is, how is that more useful than a traditional business loan, and under what circumstances does the MCA work better than business loans?

1. MCA Payments Flex With Your Income

Business loans generally come in one of two formats. Either the loan amortizes over its repayment term or there are interest-only payments with a principal payoff at the end of the term. Some banks and other lenders create niche loans beyond these formats, but most loans fit one or the other. The only way those loans have variable payments would be if the interest rate fluctuates. By contrast, a merchant cash advance payment agreement sets the payment at a percentage of your income, so if you make more money, you repay the advance faster.

2. Approvals Take a Fraction of the Time

Banks tend to make business loan approval a lengthy process because they weigh a lot of factors. It makes sense when you consider most bank loans are designed to be repaid over the course of years. In the case of some asset purchase loans, it could even be a decades-long debt, lenders naturally want to take care of. Since the merchant cash advance is designed to be repaid in just a few months, the risks to the lender and the timeline for approval are much shorter. Many businesses see the cash in as little as five business days from the date of application.

3. MCA Limits Grow With Your Income

Most business loans are tied to the value of an asset, which is how their interest rates are controlled. Short-term financing like your MCA gets based on your income, so as long as you can afford to repay the advance, you are likely to get what you need when you apply. That also means when your business grows, the size of the cash advance you can access grows too. For that reason, many retail businesses use a merchant cash advance to finance seasonal remodeling and inventory restocking processes a couple of times a year.

When Is the MCA More Efficient Than a Loan?

If you foresee an upturn in your company’s regular demand cycle or you need cash quickly to deal with a short-term emergency when you are busy, then the MCA is going to work better than a loan. Not only will you get approved faster, but paying the advance down quickly minimizes the finance charges.

Stuck in the Web

Stuck in the Web

As technology advances, changes in everyone’s work environments are inevitable. Cars aren’t manufactured the same way they were when Henry Ford started his assembly line and phones have progressed well beyond Thomas Edison’s first call. The same has to be true for careers in web development, right? Since the internet has been around so long, the careers that it first spawned are no longer relevant, right? Not really. A job in web development is still a viable path towards both career stability and financial security.

To-Do List

What does a web developer do, anyway? Simply put, a web developer designs and builds websites. That’s deceptively simple, though, because a lot more goes into it. Think about all the components of a site you’ve recently visited. Did the pages load correctly? How about graphics? Were those relevant, eye-catching and informative? Also, consider how easy it was to find what you needed on the site. It’s the web developers who ensure that those pages load correctly. They also pick the graphics and design the layout. If your site had a shopping option, the web developers have to tie that into not only the website, but also the store’s actual inventory program and shipping procedures.

Pursuing the Path

If you’re thinking about a career in web development, you’ll need to know how to pursue that for yourself. The job outlook for someone who trains in web development is higher than average. These skills continue to be in demand and will be for the foreseeable future. You can typically enter the job market for web careers after completing just your Associate’s Degree. Double-check, though. Some jobs only require a high school diploma and other employers look for Bachelor’s degrees.

Work It

You’ll have a variety of places where you can find a job with web development training, too. Think about all the places that have websites. They each need a qualified professional to maintain those. You can choose to work in a field like publishing, advertising or consulting. Companies who perform those services need capable and reliable web developers because frequently their internet presence forms the backbone of their business. If you’re not excited about branching out, many web developers stay in computer-related fields. Still others branch out into self-employment. This allows you flexibility in where you choose to live, also, because web professionals are in demand everywhere.

A career in web development can carve you a path towards the life you’ve dreamed of living.

Multifamily Financing Options 

Multifamily Financing Options 

Multifamily financing provides the means for serious real estate investors to purchase or refinance structures or properties that typically have five or more residential units. 

According to Statista, the multifamily real estate market has boomed in recent years. The value of multifamily financing in the U.S. reached over $487 billion in 2021. 

Benefits of Investing in Multifamily Properties 

The benefits of investing in multifamily properties include: 

  • Investors have an opportunity to live in one of the units while renting out the others. Thus, tenant payments help the investor to pay down his/her mortgage. 
  • Multifamily properties share some of the same amenities, so potential maintenance costs can be lower. 
  • Investors can leverage multiple units to mitigate the risk of vacancies. 
  • Growing an investment portfolio can be accelerated because purchasing a 10-unit apartment complex, for example, will take less time and effort than purchasing 10 single-family homes. 
  • While multifamily properties will be more expensive to purchase than single-family homes, multifamily financing will be easier to obtain because those loans are viewed as less risky due to the potential for consistent monthly cash flow generation. 

Multifamily Financing Options 

Multifamily financing options include: 

  • Fannie Mae and Freddie Mac loans. These loans, typically called “agency loans,” operate under a federal charter and must be accessed through approved lenders. 
  • FHA loans. These are government-insured loans and they typically take a long time for approval due to the extensive government requirements. 
  • CMBS loans. These are commercial loans that are secured by a first lien against the specific commercial property. They are available through commercial banks, conduit lenders, and investment banks. 
  • Traditional bank loans. Bank loans typically have stringent loan requirements. 
  • Loans from alternative lenders. Alternative lenders are an appealing multifamily financing option because they have less strict lending requirements, a streamlined approval process and they can be more agile and responsive. 

Seek Expert Financing Assistance 

Contact WHW Capital, based in Denver, CO. We have a great reputation for helping our customers get the loans they need as quickly as possible and that are easy to qualify for.