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A Commercial Mortgage is a Fruitful Investment For Growing Your Business in Today’s Economy

A Commercial Mortgage is a loan made with the help of a real estate agent to secure payment. A mortgage is a conditional agreement of property as collateral for the payment of a loan. Commercial property mortgage is similar and resembles to a residential mortgage. It is a loan written for the purpose of business with any commercial building used as collateral. There are definite benefits of commercial loan, mostly used for business set-up instead for some other requirement.

The borrower of a commercial loan can be a partnership or a corporate business, hence the said appraisal of the trustworthiness of the business can be more unmanageable than is the case with residential mortgages. In some mortgages, wherein the event of nonpayment, the creditor alone can comprehend the collateral, but further does not have any claim against the borrower for any deficiency. Many rules and laws usually prevent creditors for taking action against the borrower of the loan for any kind of inadequacy.

Mortgages are structured for bonds which give a higher priority to continuous flow of income and require a clause which lets the lender take back the property immediately, irrespective of the failure of legal proceedings that the borrower might face. The mortgage is provided as a responsibility of the borrower or a personal assurance from the owner, the debt has to be paid even though the proceeding on the mortgaged indirect or collateral does not fulfill the outstanding debt or balance.

The commercial property sector found a tremendous change in the last few decades. The large rise in the manufacturing industry globally accelerated the growth of the infrastructure locally and nationally.

However with the growth of the manufacturing industries in the international markets, the rate of mortgage loan increased tremendously. The commercial property loan industry is consistently growing from twenty to forty percent every year since two thousand, which is a great benefit for the international business sector.

The huge requirements of real estates, new office space, and commercial business set ups and its development have fueled enormous growth of the commercial industry. Today, there are various types of mortgages accepted as collateral and they vary and are not only confined to residential properties but also have extended to all different immovable properties and business funds carried through the mortgage plans.

There are types of commercial properties which are accepted as a collateral or dependent security for complimenting mortgage loans in most of the countries, some are namely Casinos, auto care centers, car washes, amusement parks, truck terminals, fitness centers, franchisee, malls, restaurants, theaters, hospitals, hotels, educational and training institutes etc

The Common applications for commercial mortgage loans require land or commercial investments or properties or refinancing the existing debt. Common commercial properties are restricted for office and industrial purposes. Commercial size mortgages can be used for various requirements like for the purchase of commercial land for business, for the expansion of existing premises, or for a residential or commercial investment or even for the further development of property.

Small Businesses: Top Methods for Going Green

Global warming continues to be a problem without an immediate solution and its effect of drastic changes to the weather patterns triggers a worldwide call to do our part, even in small ways, in reducing the carbon emissions in our everyday life. This global campaign of protecting the environment is usually referred as to ‘Go Green’. It is all about doing things that will be beneficial to the environment despite the advancement in technology. Becoming more common is the term of sustainable development wherein technology and nature can both grow side by side, rather than the opposite of what has been the practice in the last century where technology grew at the expense of the environment.

A personal way is going to the office in a car pool or utilizing public transport instead of driving a car individually. This way, less cars will be on the road equating to less fuels burned and less carbon monoxide production. Another way is by unsubscribing from the paper version on personal billing statements and subscribing instead on the online version of the billing statement.

Some small businesses are also doing their part of protecting the environment and started going green. If you own a small business and is not yet answered the call, you might want to try it for yourself.

One of the most common methods is by minimizing the unnecessary use of paper. With the advancement of communication technology like electronic mail, correspondences and memos, among others, can now be done electronically and avoid producing a hard copy. This way, not only does the energy in producing the paper reduced, but cutting more trees to convert to be paper is also avoided. If going paperless is not totally possible, recycling paper is the least that can be done where both sides of the paper are utilized.

Recycling other office materials is also one way to go green especially those that are made on non-biodegradable materials. It does lessen the use of energy to produce the material and avoids it to become garbage or pollutant, as well. If you cannot recycle the office supply or equipment anymore, you can at least segregate your waste materials so that it can be recycled by the proper entity.

Saving electricity and reducing its usage can greatly help the environment and make savings for the company at the same time. This can be done by powering off equipment and lights that are not being used. Using energy efficient equipment and lights, like compact fluorescent lamps (CFL), is also becoming a trend to save expenses and usage of electricity. If more businesses will do these things, it can have a big impact globally as proven by the sudden drop of energy usage during the several observances of the ‘Earth Hour’ in the past.

Using eco-friendly packaging materials is also one way to go green. Most non-biodegradable packaging materials like plastics and Styrofoam contains chlorofluorocarbons (CFCs) that also contributes to global warming when the composition of the materials have been broken down.

There are some that goes a bit further by using eco-friendly cleaning solutions. These may cost a bit more than the usual cleaning solutions but they still chose it to help the environment.

These are some of the things small businesses are doing to go green and be able to help the environment. Most of the things mentioned are even more beneficial to the companies in terms of the savings that they incur. Isn’t it good to be able to save money while helping to save the environment at the same time?

Investing on energy-efficient equipment and appliances may seem to cost more at first, but as days, months and years go by, the more you will be able to save. The earlier you start to go green, the more savings you can have and the more you can help the environment.

Business Combinations Can Work for Small Business

In my last post I suggested that small businesses should consider the use of business combinations as a means of growing their business and reducing their risk. Mergers and acquisitions, or “business combinations”, are usually thought of as a tool that large companies and investment funds use to create mammoth enterprises. We rarely think of small businesses (SMBs) as engaging in M&A activity, but for many, it could be a very valuable strategy. In this post, we are going to talk specifically about how SMBs might use a merger strategy to build a larger, stronger and more secure business.

As we all know, being a small company entails a lot a risk for business owners at both the business and personal level. It is difficult to get adequate financing without risky personal guaranties. You can’t afford innovation. Larger competitors can leverage their costs down below yours. Personnel and regulatory matters take a disproportionate amount of your time. You want to grow your business in order to reduce risk and compete more effectively, but there are so many obstacles.

One solution for growth is to merge your business with other companies that may be similarly situated. Right now you are thinking: “Wait, that’s way too complicated”, but it’s probably a lot less complicated than you think. You will need a good lawyer and a good appraisal of the value of each business, but the transaction itself can be very straightforward. The hard part is identifying the potential companies with which to merge.

Keeping the deal simple will help to control the costs and fees incurred to get the deal done. A simple combining of the participating companies into a new entity (or holding company), with each of the contributing shareholders receiving new shares in proportion to their contribution, based on a valuation method that is consistent across all the companies, is the best approach in my opinion. After completing the combination, the new entity should be able to significantly reduce the combined overhead, effectively increasing the share value of each participant.

Of course, the key to a successful combination is finding the right company, or group of companies, with which to combine. Here are some of the factors that I consider critical:

1. Product diversification. While it might be easier to combine companies that do the same thing, it wouldn’t do much to reduce product risk, which is often a big problem for small businesses. A better approach would be to look for companies that have industry compatibility but different products.

2. Geographic diversification. Again, it may be physically easier to combine companies in the same market area, but it might not do anything to reduce market risks. If you combine companies in multiple markets, you have an opportunity to cross-train sales forces and increase market reach for each product.

3. Personal compatibility. For most, it’s not easy going from being the controlling shareholder to being part of a group of controlling shareholders. In the discussion phase, you want to look for partners that have a similar strategic and personal vision for the new entity.

4. Real improvement. The proposed combination should result in better opportunity and reduced risk for the participants. For example, a combination of two companies with revenues of $200 thousand each is probably not going to represent a significant improvement in circumstances for the participants, and could even result in increased overhead. But a merger of four companies with $5 million each in revenue could result in significant overhead reductions, product and geographic diversification and increased borrowing capacity.

Remember, it’s not about size. It’s about building a better underlying asset for the shares that you own. A smaller piece of bigger and stronger pie. The idea of a merger is not right for everyone. For some, the notion of giving up absolute control is not acceptable and that’s fine. But for others, the business combination may be just the right answer to achieve business growth and reduction of business and personal risk.