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Terms related to lending and business finance.
A/R Management Services
Billing, lockbox collection, payment processing, monitoring, and reporting services.
Accounts Receivable Financing
An asset-based financing arrangement in which companies use their receivables as collateral in exchange for capital.
Process of accounting for the decreasing value of an asset over a period of time.
Annual Percentage Rate (APR)
Interest-rate finance charge in terms of a whole year applied to a loan, credit card, etc.
Commerce transactions between businesses. Short for Business to Business.
Commerce transactions between businesses and consumers. Short for Business to Consumer.
Debt that is not collectible which makes it worthless to the creditor.
Financial statement showing assets, liabilities and equity.
Payments made at the end of a loan that are larger than those made at the beginning of a loan.
Lien on all of the debtor’s current and acquired personal property assets.
Lump-sum payment made to lower the amount of some or all of the remaining payments.
Formal business statement with goals, reasons for attainment, and the plan for reaching the goals. A business plan can also contain background information.
Assets available for use in the production of goods and services.
Movement of cash into or out of a business.
A loan, the funds of which have already been disbursed, and documentation has been received and reviewed.
Property of the borrower that is used to secure the repayment of a loan to the lender.
Record of an individual or company’s past borrowing and repayment.
Number that is derived from a person’s credit files to show whether that person is worthy to borrow.
Ratio that measures liquidity in the form of current assets divided by current liabilities.
Dependent Group-Term Life Insurance
Term life insurance that gives an employee death benefits if the employee’s spouse or other dependents die.
What a person or company owes.
Occurs when the debtor cannot fulfill the legal obligations stated in the contract; failure to pay back a loan.
Status of a borrower’s account when he fails to pay a debt or financial obligation.
Loan for which the lender shares in the increase of equity in the business.
Fixed Interest Rate
Interest rate that is locked in and does not change over the life of the loan.
The date when funds are delivered to the borrower from the lender.
Agreement by an entity or person other than the borrower to repay the loan if the borrower does not pay.
Financial claim against assets; amounts owed to creditors.
Quality of being readily convertible into cash.
Service offered by banks where payments are received in a post office box and the bank picks them up to process immediately.
Merchant Cash Advance
Merchant cash advance allows a merchant to leverage her future sales paid for via credit card against a loan for an agreed-upon amount. Boiled down even more, it’s a way for a merchant to get cash upfront based on her estimated future credit-card sales.
Loan agreement that restricts the borrower from specific actions unless agreed upon with the lender.
Any party with an obligation to pay off a debt (also known as a borrower).
Reference interest rate used by banks to favored customers.
A lender that finances real estate projects after construction is finished (also called end lender.)
The original amount of debt without interest.
A written note of promise to pay from the borrower to the lender.
Amount due from individuals and companies.
SBA 7(a) Loan Program
With this program, the U.S. Small Business Administration guarantees a percentage of the loan rather than actually providing the money. It’s the U.S. Small Business Administration’s primary and most flexible loan program, and allows lenders to grant loans they may not otherwise consider.
SBA 504 Loan Program
This U.S. Small Business Administration loan program works in conjunction with Certified Development Companies throughout the United States for the acquisition of owner-occupied commercial real estate or machinery and equipment. It’s provides fixed-rate, long-term financing for businesses in need of brick-and-mortar financing.
Loans that are provided under attractive terms with 10-25 years amortization.
U.S. Small Business Administration
Provides support to small businesses nationwide by providing financial support, contracts, counseling and other forms of assistance.
Process that large financial service providers use to assess the eligibility of customers for their services/products.
A reduction in the value of an asset.