For Sale By Owner and the Web

Unless you have been living under a rock, you know the Internet has radically changed society. In real estate, this has led to a massive surge in for sale by owner properties on the web.

For Sale By Owner and the Web

In the past, choosing to go the path of “For Sale By Owner” could turn out to be incredibly difficult and overbearing. Realtors dominated the market because they had proprietary access to the multiple listing service, known as MLS, and you had to be listed in it if you wanted your property to be seen. Thankfully, the Internet has made selling a home yourself incredibly easy in a variety of ways.

If we flash back 10 years to the pre-internet days, we would find a real estate market that looks foreign to what we have today. In that market, the number one method for selling your home was to list it in the multiple listing service controlled by real estate agents. This, of course, allowed them to get their hooks into you and squeeze out a commission regardless of the quality of service they provided. If we flash forward to the present day, we find a new landscape.

A 2005 study of homebuyers across the United States revealed a fact that most realtors are loath to admit to, but know exists. Over 70 percent of homebuyers shop for potential properties on the internet. Yes, seven out of every 10 are hopping online and finding the property of their dreams. Why? The reason is very simple. Would you rather drive all over town looking at homes that don’t really match what you are after and blowing your valuable time or would you prefer to sit at your computer and click through properties with pictures? Unless you really love driving, the answer is obvious.

In our modern society, time is the most valuable asset. Listing your property on the internet is a huge time saver because it is all point and click. If you are selling, you can upload descriptions and pictures for buyers to view. If you are buying, you can see pictures of both the inside and outside of potential properties while relaxing at your desk. Either way, it beats sitting in traffic while driving all over town.

Are Business Buyer Notes Profitable?

Like anything else, it depends on the type of business you're selling. Business buyer notes are documents secured by a business, much like a mortgage broker except there is no real estate involved. Often, personal property like cooking equipment, furniture, and office equipment obligates one individual or company to make payments, usually monthly, to another person or company. Businesses are sold without the help of bank financing; this makes it much easier for a person to buy a business with a small down payment. Because the down payment is small, most banks will not finance the remaining balance, so the seller {owner} agrees to hold a “note” on the remaining balance for the buyer. This is called seller-financing or owner-financing. The buyer then agrees to pay the seller a monthly payment. The person holding the note however does not want to wait that long to receive all the money from the business, so he or she looks for a someone to buy all or part of the note being held.

Business buyer notes can be a good asset because the holder of the note can get cash in hand from an interested buyer and there are a lot of company's willing to buy business notes. The note holder may choose to sell all or part of the note and receive a lump sum for the cash he or she needs to pay off bills, go on vacation, or to buy another business, while still receiving monthly payments from the one who bought the business. The holder may also want to sell the note to get out from under the responsibility of the business. Most business owners really don't want to be note holders but in order to sell the business quickly the note was agreed upon. A drawback to being a business note buyer is when future payments are sold for cash, the current balance is always sold at a discount. The reasons behind this is time erodes the value of money, and the payee is paying the owner over time. Another reason business buyer notes are sold at a discount is because personal property and office furniture does not provide the same degree of safety that real estate does. Also the interest rates on business buyer notes are not high enough to interest investors to purchase these notes unless it is sold at a discount price.

If you are interested in purchasing a business buyer note it's probably a good idea to contact a service that will help you in these matters. First there needs to be an assignment of the security instrument and receive the endorsement of the promissory note. The service you hire in this matter will examine all aspects of this transaction, and verify all notes in question, plus they will of course record all of the necessary documents for your records. It all depends on the nature of your agreements with all involved whether your business buyer notes are assets or not.

Accounts Receivable Financing, Tax Write Off And What Does It Cost?

Banks won't lend money to a business seeking to acquire larger contracts because its not viewed as an asset. So if you are a small start up company, funding for expansion may be hard to obtain. Accounts Receivable Financing could be the key to funding for a start up with desires to bid on large Government (or Corporate) contracts.

So what is Accounts Receivable Financing? It is the selling of your accounts receivable invoices for cash versus waiting 30-60 or 90 days to be paid by your customer. Accounts Receivable Financing is also know as Factoring.

Securing the services of an Accounts Receivable Financing Company will allow a small company to bid on almost any contract within reason. A small company would know in advance that the funds needed to produce goods or provide services are available once they win the contract. In fact, some A/R Companies will advise you on which companies they will Factor Invoices from and which to avoid! (Federal Government contracts are considered "gold" however not all Factoring companies can handle Government Receivables)

One of the major concerns for most small business owners is how much does Accounts Receivable Financing cost? Between 1 to 5% generally speaking. Since Accounts Receivable Financing rates depend on the credit-worthiness of your customers, your average invoice, average payment cycle, and factoring volume, its hard to predetermine the exact cost of the money. However, you should remember, whatever the cost is: Its TAX DEDUCTIBLE and this is important. This means that the cost to factor is offset by IRS.

Not all Factoring companies are created equally (you can't tell that by looking at their web pages). A Cash Flow Consultant or an Accounts Receivable Broker can stir you in the right direction. There are issues such as: process to acquire funding, will the Accounts Receivable Financial company (factoring) company handle your collections, will they provide the funds through a credit card or will they wire the monies into your business checking account, will the Accounts Receivable Financial company factor with recourse or without recourse? (Meaning will they take responsibility for the debt or will you the client take ultimate responsibility? The rates are different)

Sometimes an A/R Broker has a choice, but not all the time. For instances, there are not that many companies that provide Accounts Receivable Financing for health care or construction. It all depends on what type of business you have and what your needs are.