New Franchisee? How Franchising Lenders Work in Canadian Franchise Finance

Being the ‘ new person ‘ is not always beneficial, especially when it comes to a major life decision such as your new career as a franchisee in Canada. Not knowing about franchise finance or franchising lenders work is definitely a set back – so lets get you ‘ armed and ready ‘ with some solid info on financing your franchise.

First of all, here’s the good news – financing a franchise in Canada is certainly possible – It’s mostly done by a guy named BILL! And we’re not kidding. More about him later.

In fact though, the franchise industry is currently viewed as quite healthy as lenders feel that the concept of proven business models and branding of your franchise are great steps to opening what ultimately is a ‘ start up ‘ business. Clearly we all agree a franchise ‘ start up ‘ is steps ahead of opening up your own business and ‘ taking a chance’.

So, can you get a ‘ standard’ bank loan to complete your franchise finance? We don’t want to be too sarcastic here, but the answer is, yes, if you have a million dollars net worth, pristine credit, and some outside collateral and guarantee ability. So what we are saying, putting that sarcasm aside, is that conventional lending doesn’t really work if you’re a new franchisee seeking an independent business opportunity financing.

So, that brings us to our friend BIll, remember we told you he finances most of the franchises in Canada. Clearly a popular guy, as he finances millions of dollars of franchises. Our clients want to immediately get to know this Bill guy. So, who is Bill?

Actually we have spelled his name wrong, its BIL, because that is the name of the government sponsored loan programme in Canada (in the U.S. it’s called the SBA loan) that funds most franchisees in Canada.

How can one program be so popular? It’s simply because it’s well suited to what you are trying to accomplish. It provides great rates, terms and structures, limited personal guarantees, and requires what we in our firm call a reasonable or decent personal credit history. I.E. You don’t need that million dollar net worth we spoke of earlier?

So how do you achieve franchise finance success with franchising lenders on the BIL loan? Again, pardon our humor, but investigate the Boy Scout motto – Be Prepared!

The essence of approval for your franchisee venture for franchising lenders under a BIL loan is a crisp business plan, a financial projection that makes sense, and various back up documents as required by the program. Naturally you also need assistance in determining who offers this loan program, how it can be sometime augmented with other financing, and it sure helps if you present it professionally and properly.

So, we always try to have a bottom line, and in this cases its pretty simple – investigate the BIL program, do your homework, identify key requirements, and, if you are challenged by any of the above seek a trusted, credible, and experienced Canadian business financing advisor who can help you achieve franchisee franchise finance success with the right franchising lenders for your BIL. And, by the way, congratulations on your new role as a Canadian entrepreneur!

How to Pay for Your MBA Degree

Education is expensive, and earning the MBA degree can be particularly expensive. Not only must you pay for tuition, books, and living expenses while at school, you must also forego the salary you could be earning using the undergraduate degree you already have. This article explores some of the ways that may help you to overcome the financial aspects of earning the MBA degree.

With the cost of MBA programs ranging from a low of about $50,000 to a high of over $100,000, many potential students may be asking themselves if the financial sacrifice is warranted. Some studies have claimed the earning the MBA degree has financial value only if it is earned from a top-tier university, and from any other school it results in a financial loss. It is therefore worthwhile, before we get into methods of financing the degree, to look at its monetary value.

Recent statistics on the starting salaries of graduates for four undergraduate fields that pay well can be compared with starting salaries of MBA graduates. The numbers are interesting:

* BS in Business – starting salary, $41,400; mid-career earnings, $70,600
* BS in Accounting – starting salary $46,500; mid-career earnings, $77,500
* BS in Paralegal – starting salary $50,000; mid-career $75,700
* BS in Nursing – starting salary, $52,700; mid-career $68,700

A recent Wall Street Journal article described a study of starting salaries for 2010 MBA graduates in the US. Their median starting salary was slightly more than $79,000, not including a sign-up bonus with a median of about $13,000. The median is the middle value. That means that half of the graduates earned less the $79,000 and half earned more. We know that graduates from some of the top MBA programs in the US easily receive salary offers of $100,000 and more. You can see that starting salaries of MBA graduates easily exceed mid-career salaries of undergraduates of the most lucrative fields. We can assume, therefore, that the MBA degree is worth attaining. The question then is “How do I pay for it?” Here are some approaches.

Most MBA programs accept students who have an undergraduate degree in any field and have worked in meaningful jobs for two to four years after graduating. People contemplating the MBA in their future should make every attempt to save as much as possible during the years gaining work experience that MBA programs desire. Personal savings are an important part of financing your MBA education.

Another vehicle is the job itself. Many companies encourage their employees to gain further education and support this by providing all or part of the cost. If you work for a company that helps to pay the tuition or other costs of an MBA program, taking advantage of such help is wise. Often such financial support requires that you continue working for the same employer after attaining the degree, at least for a specified time period. Financial help from the employer typically means participating in a local or distance learning part-time MBA program.

Part-time study can also be financed by continuing to work as a means of paying for the education. This often causes the degree to stretch over a longer period of time. It is not surprising that so many schools offer part-time MBA evening programs. They are filled with students with full-time day jobs, whether or not the employer provides any financial support.

For students wanting full-time study, an obvious source of financial aid is a scholarship or an assistantship. Many MBA programs offer financial aid to qualified students, usually based on merit, in the form of reduced tuition of assistantship requiring the student to perform some work while studying. The work may consist of assisting a professor with research or clerical tasks. An assistantship can in itself constitute an important part of the educational process.

A last resort of financing consists of debt. Many students depend on loans from family members, family businesses, private sources, government loans or student loans from lenders arranged by the educational institution. The assumption is that the MBA will lead to a well-paying job which will make it possible to repay the loans.

A final source of education funding which will soon be available in the United States is a Kyrano auction. A Kyrano auction is unlike any other auction in that the price of the product being auctioned decreases with each bid. Another unique aspect of Kyrano auctions is that they are available to provide discounts on college tuition, student loans, credit card debt, and similar financial obligations. In the case of tuition, students pay a fee to enroll in the auction, with the fees creating a discount. When bidding starts, every bid increases the discount, in effect providing the winner a reduction of the next tuition payment. The winner’s discount is paid directly to the student’s school, with the student required to make up the remaining balance. More on Kyrano auctions will be available in future articles.

Planning For Emergency Financial Situations

Emergency financial situations can happen to anybody and any financial arrangement exercise is not ideal without planning for such occasions. The whole idea of having an emergency fund is to offer a cushion against any unexpected expense.

This will ensure it does not have any negative impact on your financial condition and does not rip off the whole financial security.

There are many circumstances which can cause a financial emergency such as a sudden illness, accident, medical emergencies, emergency house repairs, loss of a job, emergency car repairs and much more.

The major reason for having an emergency fund is very clear because when a person falls into an emergency financial situation, they will have to break their savings or make a compromise to get the needed money.

It’s not rare to find people who just take out their credit card and swipe it for hard cash. Opposing popular opinions, credit cards are the worst way to fund any financial emergency. The fastest way to get thousands of dollars its to get a car title loan it is not a long-term solution but a short-term solution.

In a circumstance where you’ve taken a cash advance with your credit card to get the needed money, the credit card company will charge you a cash advance fee with an interest rate. This is a very costly way to borrow and manage finances for emergency situations.

Therefore, what is the best amount that should be set aside as emergency money? There are diverse opinions on it. Some professional’s experts agree that a minimum of 3-6 months’ worth of monthly income should be set aside for an emergency situation. This amount can differ according to marital status, the size of family and lifestyle.

Everyone must reserve some extra cash in case of emergencies. But, the amount to reserve depends on your income and monthly expenses. The amount that is needed for your emergency fund is open to debate, the minimum amount should be sufficient to cover your expenses for daily living for at least 3 months. It’s also ideal to save for 6 months even though some financial advisers agree on a full year worth of cash.

These funds must be kept aside in an instrument, which is easily available when needed. It could be money in a bank account, hard cash, liquid funds or fixed deposits. This will ensure the fund is always accessible instantly or within a short period when it’s needed.

Where to Keep the Cash

Your situations and what can offer you peace of mind are the factors that can help you determine how cautious you want to be. Keep your emergency fund somewhere that is safe and accessible because you may be required to get the cash in a hurry when an emergency arises. The best option you’ve is to open a money market account or savings account. But, always examine their offer with regards to the interest rate, minimum balance, and other terms.

When you think you’ve saved enough, you can stop. You can now sleep easier and try to start placing your extra saving into higher-interest and less accessible accounts or investments.

Great Tips For Setting Up Your Home Business

This is just a short article to explain just some of the key areas that you will need to consider when setting up your UK Home Business.

Investigate ways you could find work

One of the main things you need to think about is where and how you will go about finding potential work and customers. Depending upon the area of your business it may be worthwhile looking on the internet to see how much competition there could be either online or in your local area. After all there would be little point in running a business if there are already a number of other successful businesses as you may not be able to gain enough work.

It may also be a good idea to join as many relevant websites as you can find and ask questions and generally have a browse around. This can give you some ideas on how to conduct your business and marketing which should mean that you are fully prepared for when you start your business and you will not get any nasty shocks.

Make sure that you make enquiries

It is always a good idea to work out what the going rates are for the work you will be doing. Often you may be surprised to find that you cannot earn as much as you originally thought. It also means that you can work out if you can survive financially on your new wage and generally if your UK home business would be viable.

If you have never set up or run a business before then you might find that contacting a marketing expert or business mentor could help teach you how best to conduct your new business. This way you will know exactly how best to approach your advertising campaign and be given some useful tips to help get your business up and running successfully. By doing this you could avoid months of unsuccessful and expensive marketing campaigns.

Think about any additional expenses

Depending upon the type of business you have you may need to think about any additional expenses when you start up. This could be an initial outlay for materials or supplies, finding somewhere suitable to work and also if you will need any assistance with the day to day running.

It is worth taking into account all of the above before you make the financial commitment to begin your own UK home business.

Rise in Inflation to Affect Student Loan Rates

The unexpected rise in Retail Price Index (RPI) could leave as many as four million graduates and students facing a rise in interest rates. Student loans are related directly to the RPI measure of inflation for each year. According to the latest figures, the RPI went up by 4.4% in March this year implying that student loans are set to surge.

Needless to say that this would come as a shock to the students given that they are currently paying negative or no interest because the RPI had fallen to a 50-year low of -0.4% last March. The rise means that the student loans would continue to grow even when they begin to make repayment and that the interest would be higher than their repayments.

For over 400,000 graduates who are repaying loans that they took before 1998, the interest rate is entirely based on the RPI. The rise in RPI means that they would need to start repaying 4.4% on their outstanding loans. For the remaining 3.3 million people who have taken out student loans since 1998, the interest rate is either based on the RPI or the Bank of England base rate plus 1%, depending on which is lower.

The base rate has been 0.5% for the past 13 months, and in case it stays the same, students will now have to pay a new rate of 1.5% interest from September. Students currently at university or college can take out loans up to a maximum of £10,153 a year, implying some will be graduating with debts of more than £30,000. For many students this could mean that their debt would continue to rise even when they start earning.

All this may spell bad news for the students but it is important they understand that they should seek debt advice at the earliest to avoid a bad debt situation right at the onset of their careers. A careful financial planning on their part can ensure that the situation does not go out of control. There are many debt management companies in the UK providing free, impartial and non-judgmental debt solutions on managing finances and loans. It is in the best interest of the students to approach the financial experts and talk to them in confidence about their debts and seek their opinion in dealing with them.