In Tough Times Commercial Real Estate Borrowers Go Beyond Big Banks

By now we all know that the financial meltdown of 2008 has had a major negative impact on the banking industry around the world.Even usually rock solid commercial real estate has suffered because banks who are fighting for their lives have tightened the strings considerably.

Traditionally big banks have relied on commercial finance as one of their most profitable areas.That is because larger commercial projects have been seen as more reliably and objectively evaluated and risks more easily quantified than is the case with smaller projects.

Near the beginning of the downturn in the domestic real estate market in 2008, commercial real estate projects continued to find favor with the big banks.Commercial real estate loans were seen as a safer investment for companies with large capital reserves.As a result the commercial market continued to grow even as single family homes sales were plummeting.

In order to understand what is currently happening in the commercial real estate sector it is important to note the differences between commercial financing and residential financing.While they both involve an advance of funds based on the value of the properties involved, there are some significant differences in the way the risk is evaluated.

We all know that the collapse of the residential sector was brought on by mortgage companies making far too many irresponsible loans to people who could ultimately not afford them.The residential mortgage system came tumbling down like a house of cards when mortgages had to be renewed at amounts greater than the value of the houses, and at rates people could simply not afford to pay.Many of those people did the rational thing and walked away from their homes.

In several important respects commercial real estate loans are different.Most residential real estate loans are limited to several hundred thousand dollars.Commercial real estate loans on the other hand are usually for millions.Some commercial loans even reach into the billions.

While it is true that a bank or investment company is risking more on a commercial project, commercial lending is still seen as a safer investment.For the most part, the criteria for commercial loans are very stringent.Commercial borrowers are typically required to provide a substantial amount of collateral and must present accountant verified assets and income statements.This allows the lender to make an informed decision on a borrower's credit worthiness.

Because commercial products involve larger sums of money, the perception has been that smaller institutions cannot compete with large banks.But the events of 2008, and the adjustments that most big banks are having to make are having an interesting impact on commercial lending.

Big banks with extensive exposure to real estate markets are pruning marginal accounts in an attempt to limit their exposure to the sector as a whole.Whether this makes sense of not, it is typically what big banks do.In many cases whether a commercial deal looks good or not it will not go ahead with a large bank because they have decided their exposure in that sector is already too high.

This creates opportunities for small banks, lending institutions and brokers with connections to alternative sources of funding.These smaller lenders are not overexposed to the commercial real estate market, and are often willing to consider good deals that the large banks no longer find attractive.

About the Author

For commercial financing and commercial real estate lending see East Coast Commercial finance.

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The Differences Between Direct Sales And MLM Companies

For those who want to work from home or run their own business, two common ways to do so is through a direct sales business or a multi-level marketing company.Many people use the terms interchangeably, and although they can be similar, they aren't exactly the same thing.So, what is the difference between direct sales and MLM companies?Let's take a closer look to help you understand.

Direct Sales Business

A direct sales business is one in which you can work for an already established company.

The company normally sells products or services and they look for representatives to help them do so.This allows an individual to become a representative via their own business and sell the company's products.

This makes it easier for someone to work for themselves without the overhead costs associated with starting a business from scratch.Many times the individual will also be able to sell the products without maintaining an inventory.This saves the rep money as well because there is no need to house the products yourself or pay for storage.

The company will already have packages set up that include product samples, promotional material and more for the representative to use.A good direct sales company will also provide training and other resources to help the business owner grow their business.These packages do cost money to purchase but many times it's a one-time fee and the individual will be able to use these items as long as they are working with the company.

You then use the material provided and sell the products of the company.In turn, the company pays you a percentage of all the sales you make.Depending on the company you are working with you might be able to set your own sales price and keep any money left over after you've paid for the items from the company.

For instance, let's say the cost for you to purchase an item is $1.According to the company's policy you are allowed to mark up the sales price to whatever you choose so you sell the item for $2.Once you receive the money from your customer, you pay the direct sales company their dollar and you keep the remaining dollar for yourself.

There are tons of direct sales companies out there that allow someone to start their own business by selling for them.A few common examples, that you may have heard of include, Avon, Tupperware, Home Interiors and Mary Kay.

These companies sell kitchenware, make up and other products but look to expand their company's profits by working with business owners around the world who like the idea of running their own business, but want the security of something already well established.

Multi-Level Marketing (MLM) Companies

With multi-level marketing companies, it's common to see the same names as you do with direct sales companies.

As a matter of fact, most direct sales companies have some form of MLM in their business structure for those interested.

Multi-level marketing is just what its name implies - multi-levels of income potential.Let's use an example to help you understand how it works.You've just signed up with Company X to be a representative and sell their products to others.You've also been offered the opportunity to recruit others to also sell the products.

You book a party and the hostess (we'll call her Susan) decides she would like to sell Company X products as well.You sign Susan up and she becomes a member of your "down line." You will now make money from the sales received from your customers and you'll also make money when Susan sells products as well.Susan can do the same and depending on the company policy, you might be able to make money on sales that Susan's down line creates as well.

Although the terms direct sales and MLM are used interchangeably, they aren't the same thing.The reason is because most direct sales companies do not require their reps to participate in the multi-level aspect of the business.There is more money to be made when an individual chooses to recruit others, but for some that just isn't their cup of tea.Companies realize this and many are just as happy to offer both options to their potential representatives.

About the Author

Chris Simpson is dedicated to helping people find honest and legitimate work at home opportunities and home based business ideas.

Find legitimate work at home jobs and many other great opportunities to make money online today at: www.HomeNetPro.com

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A Leader Understands Leadership Development

There is a cycle in life that permits the growth and prosperity of the human race. It is the idea of teaching and learning, leading and following. We must each take part in both sides of the spectrum at some time in our lives. Some are asked at a very early age to take charge of their destiny and forge the trail for those who will come behind. It is not often examined why, but we must discern the two schools of hint that surround leaders.

There exists a political views that leaders are leaders as it is their inheritance in life; they are given the art of individual able to show cherish birth. One more convenient states that leaders emerge when they are needed. Every time the surroundings calls for that someone hold the usher or drive, one will step forward to fill the blank. Lets verify either possibility to see how we can assist to mature the leaders of our interest and neighborhood.

It is that you can think of that there is a match between the two ideals of which we have said. The evaluating since birth that they go through the capacity to steer will get ready one or two so that when the chance arises, they will exceed the expectations of those who need one another to conduct. On the distinctive hand, there may be one or two born to privilege who pick to step trailing from leadership whenever that alternative is exhibited.

The capacity to direct may be likened to the aptitude to glance through. You cannot dominate the energy or size of the waves, but if you absorb how to ride one another, you will be prosperous. The chore of a boss occurs as he comes to get hold of that indoor his aspect of affair there are controllable and aday-and-night variables.

He must get ready to live on whenever the uncontrollable variables develop into intense, and he must not variety excuses for lack of modernization whenever he has failed to utilize a controllable variable. The pretext this is the setting out of the job of a boss is given that if he can concentrate all of the coming about actuality almost himself, it will be as the focusing of light on a lone take. Once the illuminate is intent, it will suffer voltage. If the illumine is not all pointed in the matching route, it will certainly not make life plenty to burn or variety an impact. Taking business to oneself for controllable variables is the commencement of generation the voltage of a head.

Now lets assess an extra key factor that is broad to a boss. In bid to let the perpetual exercises of the population, the head must suffer not simply the ability to teach, but to capacitate. He must change his affair and evaluating to a format and algorithm that will enable the replication of episode and common sense in those and which he is associated. This style of practice concerns a whole cycle of meted out grounds and practice. A leader will familiar with that he can reach his finalize society if he is able to train ample members of the society who can at that time reach the populous. He will create a drills cycle that is trouble-free to transfer as one trainee after becomes the instructor.

A firm chief understands that he can make the certain imperative impact if he teaches others to purchase the progress of a head. Leaders, whether born or emboldened by framework, are detail to the modernization of interest, group and brains as a whole.


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