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Thread: Confirmed orders, approved finance, still no loan from the banks

  1. #21
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    My parents will get the results on Monday, please hold thumbs for me!

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    Diamond Member Blurock's Avatar
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    Lightbulb Purchase Order Finance

    In the USA businesses use Purchase Order Finance in a situation like this. All they need is a confirmed order from a reliable purchaser to make it a self-liquidating transaction. Very often in South Africa an opportunity is missed because of lack of working capital and the reluctance of banks to assist SME's (despite their fanfares at the start of every financial year).
    Purchase Order Finance considers the repayment ability of the purchaser (Debtor) and relies on the integrity of the supplier as well as the debtor. The transaction is very much like a trade finance deal where the purchaser gives confirmation of an irrevocable order. The financier or bank will take ownership of the goods purchased and manage/control the import end to end with delivery directly to the purchaser.
    The purchaser (debtor) pays the financier on receipt of the goods and the mark up (profit) of the transaction is paid to the supplier after deduction of fees and interest.
    When approaching a bank, it is of no use talking to someone at your local branch. Approach the business banking section and make sure that they understand what you are talking about. If you do not speak to the right people, you will never get the right answers. There are some private companies and investors that may be able to assist in this regard.

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  4. #23
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    SO BusFact is saying that 'if you have no significant assests worth well over R450K' you don't stand a chance in hell of acquiring a loan/bridging finance and the likes from banks? Well here is the thing - I have assests well over that. I am applying to take out the excess money that I have paid into my home loan and to take the homeloan back up to the original contract price but I have been declined? What the hell?? My homeloan is actually in advance, I have never missed one payment and now I have to supply them with my great grandmother's uncle's DNA! I have resided in the same property for over 20 years, do not have credit other than the homeloan and the usual utility bills- oh IS THAT my problem? I don't have any traceable credit, I don't owe thousands to any creditors? Can somebody tell me what needs to be done here? I have supplied the bank with a set of financials for the period 1 March 2010 to 28 Feb 2011, income and expense statement for the last 3 months,e a projected income and expense statement for the next 6 months, salary slips, bank statments - what the hell else do they need from me? Now they are calling for my drawings.........a sole proprietor..... my expenses ARE my drawings!

  5. #24
    Site Caretaker Dave A's Avatar
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    Banks have always been a bit otherwise when it comes to personal finance for sole proprietors
    I'm not sure why exactly, but I suspect it's because it messes up the risk evaluation formulas.

    My suggestion - convert to a company to get the business side out of your personal finances.

  6. #25
    Diamond Member Blurock's Avatar
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    Hi Wolf.Forward me your website and I will see what I can do.

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    Quote Originally Posted by Blurock View Post
    Hi Wolf.Forward me your website and I will see what I can do.
    Yes likewise... I am ready to invest in a new business venture

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