Everything about running a small business can be difficult. Even if you have a successful business that you’ve managed to get off of the ground, it can feel like you’re fighting for every little thing just to stay afloat. In the fast-paced, modern world, sometimes it may seem like it’s impossible to grow your business, especially to the extent that you would like. Here at ABO Capital, we can assist with business loans which give you the opportunity to grow your business your way.
Owner-User Business Loans
More and more businesses than ever before are conducting some of their business online. However, even with that, most business owners also want actual, physical office space. Perhaps it’s a retail storeroom to show off their goods, or maybe it’s an office for their workers, but regardless of the reason, it still makes quite a bit of sense for a business to have a physical location workers can meet at daily. Additionally, it can help the business owner to have their own building.
Of course, getting an office building isn’t easy, either. It can be prohibitively expensive. Most small businesses, even successful ones, don’t have the money to make an offer on the building. They may also not have the kind of money to put down the thirty to forty percent it might take to get the building, either. This can slow down or even stifle a business’s growth. That’s also where we come in.
At ABO Capital, we can help you to get an SBA Loan. This loan can allow you to buy a building at a much lower down payment than you might have been able to otherwise. Many of our clients are able to use these loans to get all types of real estate. Typically, only 10% down is required. That may sound like a small thing, but it can save your company thousands of dollars or more. It can make the difference between “having an office and expanding the business” and “shutting the doors for good.”
To qualify for these SBA Loans, you and your business have to meet certain minimum requirements. You also have to plan to occupy 51% or more of the office building to get the Owner-User loan. The government likes helping out small businesses. Have you ever gone through an entire election cycle without hearing a candidate say something to the effect of: “I have a plan to help small businesses?” Of course not. The government has a vested interest in helping small businesses to grow. So, they guarantee these loans to perform for banks.
Now, banks still don’t want defaults on these loans. They want their borrowers to be able to pay them back, regardless of anything that the government will do. What these loans actually are is an opportunity. They are a solid chance to expand your business without having to hurt your bank account too much in the process. On top of that, they can also help the business owner in quite a few ways as well.
Why Be an Owner-User?
Some business owners balk at the idea of owning a building. “Why do I need all that? My business is fine renting a space,” and variations of that argument are things we’ve heard quite a bit. However, these loans aren’t just about your business as it is today, but rather about the future of your business. They’re about your future, too.
For example, it’s just a fact that a business that owns its own building is taken more seriously. To be clear, they’re not just taken more seriously by their customers, clients, and investors, they’re taken more seriously by banks and other lenders, too. Setting up a credit line can be extremely difficult without owning your own building because you have so much less collateral. However, once you have that building that makes for very strong collateral indeed.
In addition to setting up credit lines, owning a building makes it so much easier to get other kinds of financing, too. After all, when you own a building, you are quite literally “putting down roots.” You are anchored in place. Sure, you can expand beyond that building, but you are also tethered to that building. Lenders and banks know that you aren’t running away, you aren’t just going to take their money and disappear into the night. They know that you have a foundation, that you have staying power. They know it’s extraordinarily unlikely that you’ll just up and break and lease.
That being said, owning a building can help the business owner in the future, too. To use an example, say that you get a loan for your business. Your business is growing, it’s time to expand, you want a better office and a better future. So, you come to us for an Owner-User loan, you occupy 51% of a building, we get you the loan, and voila: you own the building. You move your company in and get right to work.
Then, over the next several years, your company does well. This makes sense: you were growing before you got the loan, and now that you have it, you’ve been able to turbo-charge what your company does best. We aren’t saying that your company becomes some kind of global behemoth, but rather that you do well enough to pay off the loan in the next ten, twenty or even twenty-five years. You put in a lot of work, and your company has responded.
So, by this point, you’ve been working for a long time. You’ve been really successful, but you’re also starting to slow down a bit, too. Maybe you don’t want to go to the office for ten hours a day, five days a week. Perhaps it’s time to start thinking about retirement. At this point, another major benefit of the Owner-User Loan kicks in. See, now you own this building. It’s completely paid off. In all likelihood, it’s a multi-million dollar property. You can use this to retire with. This building, which you used a loan to get so many years ago as a foundation for your business, is now able to serve as a foundation for your retirement.
If You Didn’t Get the Loan
Of course, there’s an alternate path to this as well. Imagine a scenario where you didn’t go for the Owner-User loan. Maybe you didn’t want to expand your business to the point where you’d occupy 51% of a building. Perhaps you were hesitant about taking advantage of an opportunity. In this scenario, your business continues renting. So, you don’t have a foundation. Something without a foundation can be wiped out, and a business is no different.
Maybe your landlord raises the rent above what you can pay. Or alternately, perhaps they just kick you out for… well, any reason. They’re the landlord, they own the building, and they can essentially make that decision. Now, not only do you have to find somewhere else for your business, you have to pay for moving costs and everything associated with finding a new place – all the while, still running your business. On top of that, you won’t have anything approaching that same point for retirement as well.
ABO Capital for All Kinds of Businesses
At ABO Capital, we’ve helped so many businesses to avoid the second scenario. When you own the building your business is in, you can do so much more: for yourself as well as your business. Of course, these Owner-User loans are just one of the different kinds of financing options that we offer. If you’re looking for loans to expand your business or simply want to talk to a professional about what’s out there for you, message us through our site or call (888) 801-5401.