Since the banks have left many Project Financing options hanging, there are other options that have come available to companies looking for larger ticket financing.
Most of the Private Project Financing lenders are looking for deals in excess of $25 million loan amount, but some will lend as little as $5 million.
Where does the money come from? Generally Private Corporations that manage hedge funds and the like that have found an opportunity that has been left by the banks since many banks are not funding these types of deals anymore.
We all know that credit risk is the main factor in lending, and with the banks out of the picture now, the credit risk for investors like this has dropped significantly. Most of the Project Financing that is done is based on a prime plus basis. On average you can expect to pay prime plus 4 to 6 on a loan like this.
It really does not matter what type of Venture Financing you are looking for do - it can be Real Estate Developments/Acquisition, Alternative Energy Projects and Import/Export deals.
Requirements. In order to apply for Project Funding you need to have a well crafted Executive Summary to start. You need to demonstrate that you have the capability to see the project through. The Executive Summary must be both your resume as well as the analysis of the project to show how you will do it, step by step and also an exit strategy to show if things do not work out, how the lender funds will be secured.
If you have everything done ahead of time and all your information is complete then you can expect to close in as little as 45 days. After you have accepted the terms of the financing then the file goes to an exhaustive underwriting process to make sure everything is set up properly and the risks are minimized.
Why is a vested interest needed? Quite simply if things are not going well, if the borrower were to walk away and leave the lenders hanging so that they would be forced to liquidate, there needs to be a cushion to protect the lenders investment in your project.
This can come in the form of you having a escrow or bond in place as a security instrument, you coming to the table with a portion of the funds to close, a due diligence fee up front or a combination of these.
If your venture is on hold, speak to a Commercial Finance Broker that is set up for Project Financing so you can get back on track.
Most of the Private Project Financing lenders are looking for deals in excess of $25 million loan amount, but some will lend as little as $5 million.
Where does the money come from? Generally Private Corporations that manage hedge funds and the like that have found an opportunity that has been left by the banks since many banks are not funding these types of deals anymore.
We all know that credit risk is the main factor in lending, and with the banks out of the picture now, the credit risk for investors like this has dropped significantly. Most of the Project Financing that is done is based on a prime plus basis. On average you can expect to pay prime plus 4 to 6 on a loan like this.
It really does not matter what type of Venture Financing you are looking for do - it can be Real Estate Developments/Acquisition, Alternative Energy Projects and Import/Export deals.
Requirements. In order to apply for Project Funding you need to have a well crafted Executive Summary to start. You need to demonstrate that you have the capability to see the project through. The Executive Summary must be both your resume as well as the analysis of the project to show how you will do it, step by step and also an exit strategy to show if things do not work out, how the lender funds will be secured.
If you have everything done ahead of time and all your information is complete then you can expect to close in as little as 45 days. After you have accepted the terms of the financing then the file goes to an exhaustive underwriting process to make sure everything is set up properly and the risks are minimized.
Why is a vested interest needed? Quite simply if things are not going well, if the borrower were to walk away and leave the lenders hanging so that they would be forced to liquidate, there needs to be a cushion to protect the lenders investment in your project.
This can come in the form of you having a escrow or bond in place as a security instrument, you coming to the table with a portion of the funds to close, a due diligence fee up front or a combination of these.
If your venture is on hold, speak to a Commercial Finance Broker that is set up for Project Financing so you can get back on track.
About the Author:
Wade Henderson - recognized Professional - 15 yrs in the Business Finance Field - strong reputation for getting the deal done. IMMFinancial.com growth capital Project Financing Get a totally unique version of this article from our article submission service
Aucun commentaire:
Enregistrer un commentaire