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Apply for business financing

Apply for business financing

Anyone who has expansion plans as an entrepreneur usually does not have sufficient financial resources to realize those plans. Do you have expansion plans? Then you must look for the best form of business financing. Through business financing, or business financing, you can undoubtedly realize these expansion plans. Financing your company is possible in various ways. The two best known forms of business financing are a business credit and a business loan. Comparison of these two forms of business financing is necessary to determine the best form of financing for the realization of your expansion plans.

Financing a company through a business credit

Financing a company through a business credit

Do you temporarily not have sufficient liquid assets? Then you can consider taking out a business credit with a bank or another lender. You then agree that you can dispose of a certain amount. The amount that you can dispose of depends on the annual profit that your company makes.

Suppose you have received a business credit of € 100,000 from the bank or another lender. You can withdraw this amount in whole or in part. For example, do you need € 50,000 to realize your expansion plans? Then you only pay interest on the amount withdrawn. Have you repaid part of it? Then you can also record that part again. You can take out and repay with a business credit whenever you want. A business credit is therefore very flexible. What is the interest of this form of business financing? Count on an interest rate that can vary between around 4.8 and 8.6%.

Financing a company through a business loan

Financing a company through a business loan

Do you have insufficient cash to realize the expansion of your company? Then you can decide to take out a business loan with a bank or with another lender. There are several factors that determine the amount of the maximum loan amount.

Suppose you have taken out a business loan of € 200,000 with a bank or with another lender. You can then withdraw this amount. With this amount you can realize your expansion plans. With this form of corporate financing, which has a fixed interest rate, you repay the loan during the term agreed with the bank or other lender by repaying a fixed monthly amount. You can no longer withdraw the amounts that you have repaid. A business loan is therefore less flexible than a business credit. At the end of the term you no longer have any debt to the bank. What is the interest for this form of corporate financing? This can vary between approximately 2.5 and 5.1%.

Choose the right provider

Choose the right provider

Have you decided to apply for financing online? Via this website you can compare the providers of business loans and business loans. Once you have found a loan or loan that fits your needs, you can go to the relevant provider. Gradiegood.nl is happy to help you compare the providers of all business loans.

 

6 tips to make your loan really profitable

Do you plan to take out a loan? Then make sure it is really profitable. What to look for when choosing it and what to watch out for? Here are 6 tips to help you choose the right credit product for you. And in terms of convenience. This is the only way to make sure that you do not step next to choosing your loan.

Focus on the interest rate

Focus on the interest rate

This is a good initial indicator of how you can filter out bargains from the bargains. The interest rate is given as a percentage and one important rule applies. The lower it is, the more advantageous the loan is. But beware of two important things. Low interest universally does not mean profitability, because it is only a percentage of how much the provider so-called “hit” the amount. In layman’s terms, this means that it indicates how much the bank or non-banking company will earn from you. In addition, it should be borne in mind that the rate given, for example, in an advertising leaflet may not be the one you get. These are the rates that the so-called ideal client gets. If your creditworthiness is worse than its prototype, interest may rise. Be careful about that.

Also follow the APRC

Also follow the APRC

The second thing to watch is the so-called APRC. This is the annual percentage rate of charge. Even this is given in percentages and this should be as low as possible. An important fact about this rate is not only that it is mandatory to state it, so you can find it very quickly and easily. An important fact is that the rate must include everything that increases the price of the loan. It can be different charges, it can be the amount for insurance as well as the interest itself is included in the rate. Therefore, it is an ideal indicator of the profitability of any loan – that is, except for those with shorter maturities, where it is disproportionately high and is better to use common sense. A typical example is the so-called micro-loans, where the APR is really high due to its calculation. Really, however, thousands of percent more certainly not pay.

What is the APRC and why is it worth paying attention to it?

Set the correct installment amount

Set the correct installment amount

Also, how high your repayment will significantly affect the actual profitability of the loan. It should be remembered that the repayment should primarily suit you, not the credit company or the bank. First of all, you need to be clear about how much you can afford to pay back so that it doesn’t put your budget at risk. If the repayment amount exceeds the calculated amount, it is a relatively big problem that will put you in financial distress. However, the opposite situation is also complicated – when you set your installment too low. You will repay the loan for an unnecessarily long period, leading to a significant overpayment of the loan. This is because interest is calculated annually on the outstanding amount, which will still be quite high for small installments. In addition, think of the fact that the loan is a commitment that is good to get rid of as soon as possible and have a so-called clean shield.

Beware of additional products and services

Beware of additional products and services

Many lenders may also offer some more to their base product. These are so-called complementary products, which at first glance should look like something that the client needs and cannot do without. The reality, however, is that these are complementary products and services that are not so beneficial and which may unnecessarily increase the loan. What are these specifically? For banks, it may be necessary to open a special credit account where fees associated with its management may appear. In the case of non-banking companies, it is often a diverse repayment insurance to protect the client in unexpected situations. But the fact is that long-term loans are money you give extra. And in a few years it is a large sum of money. If you decide to use an add-on product, you should also check the terms and conditions to make it really useful to you.

Just take what you really need

Just take what you really need

Before you apply for a loan, it is a good idea to know how much you really need. So be clear about what you want to buy and how much the thing costs. This is important so that you know what specific amount to ask for. Even if banks or non-banking companies offer you more, don’t be convinced of the higher amount. Though it may be tempting to have a larger sum of money available, but remember that interest is calculated on the amount provided. The more it is, the more you will overpay. Apart from that, extra money can also increase your monthly payment if you insist on a certain maturity. This is also good to watch out for. Unfortunately, many people succumb to pressure and eventually nod to the offer of a larger sum of money for which they may find employment, but will pay more than if they insisted.

Check your money provider

Check your money provider

In the current credit market, you can operate in three segments. They are banks, they are non-banking companies, and they are also loans from people. Whichever option you choose, it is also a good idea to thoroughly examine the funding provider itself. This is primarily because of the fact that you are not surprised by the different conditions in the contract, possible sanctions, or not quite standard approach. It is appropriate to put mainly on various references, discussions and evaluations. You can ask for acquaintances, but also search the Internet. Only a provider that is well rated is the one who can offer what you are looking for. So the most advantageous loan on the market. The ideal way can be to use various loan comparators, which offer both a list of individual providers in one place, but often bring just the evaluation of individual clients.

Do you have a loan? You can deduct interest on taxes

 

Having a loan these days is nothing unusual. There are a lot of people who have it. Who is looking for the one that will be advantageous should look at both the APR and the interest rate. If it makes up a substantial part of the total APRC, it is good. Both because you do not have to worry about different fees and accompanying payments, and because you have the possibility to deduct interest from taxes. It is one of the best known deductible items. If you haven’t used this option yet, it’s high time. You can save tens, but also hundreds of thousands of crowns.

Only for certain types of loans

Only for certain types of loans

At the outset, we have to say that it is only possible to deduct interest on some loans. If we look at the general characteristics of what they can be, they are loans that solve the so-called housing need. What do you think of this term? These are loans that relate directly to housing and its financing. If we are to be more specific, it is primarily two types of loans. And that is:

  • Classic bank mortgage
  • Building savings loan

Not just for yourself

Not just for yourself

Usually, the cases of use of the loans are quite clear. He is the one who intends to invest his housing in this way. So even a specific taxpayer. The latter also has the right to deduct interest. But the law also thinks of another situation. Interest deduction can be realized not only when the housing needs of a particular taxpayer are solved, but also when the housing needs of their loved ones are solved.

What the money was used for also plays a role

What the money was used for also plays a role

Let’s say you have these two loans. But that still does not mean that interest deduction is possible. It is also the role of exactly what the finances will be used for. We will return to housing needs here again. It is not possible to deduct interest rates if the loan was used, for example, to finance a holiday home such as a cottage or a cottage. Also, no deduction is possible if it has financed commercial activities, such as the construction of an apartment building that will also serve other tenants. Therefore, the possibility of deducting tax interest on these loans is linked only to options such as:

  • Buying a house or apartment
  • Reconstruction of family house or apartment
  • Construction of a family house

What specifically can be deducted?

What specifically can be deducted?

Many people are not quite clear about what can be deducted. They live in the mistake that it is possible to deduct every installment paid. But this is not the case. Each installment consists of principal and interest. The principal is the real amount borrowed. The interest was the increase. As regards tax reductions, only interest paid can be deducted from them.

What is necessary to have?

What is necessary to have?

It is clear that, in the light of the above, it would be quite difficult for each taxpayer to calculate how much the principal repayed and how much interest was paid. This is one of the reasons why it is possible to ask a specific bank or building society for a statement of interest paid. The original must be kept, as it serves as proof that you have the right to deduct. It also helps you know exactly how much you deduct.

If you are applying interest paid for the first time, you must also have an extract from the Land Register. It will prove that it is not a recreational or commercial building, as well as that it is in this case that address the housing needs of the taxpayer, or someone close to him. They are, of course, close to the family. It is not possible to apply a deduction, for example, to a loan from which one of your friends finances their housing. It is not that simple after all.

What is the maximum deduction of interest?

What is the maximum deduction of interest?

Nothing is unlimited and this case just confirms it. If you are interested in exactly how much you can deduct, then we must say that the amount is definitely quite favorable. The maximum amount stipulated by law is CZK 300,000. This is the total. This means that this value must not exceed all deductible interest, for example on several mortgages and building savings loans together. Also note that this amount does not relate to the entire duration of the loan, but that it is an annual amount. This maximum can be deducted each year.

The first years you save the most mortgage

It is also good to look at how mortgage repayment works. Even in this, many people are not quite clear. If you look at the repayment schedule, it happens that the first months, or even years, you pay only interest. Only then do you repay the principal. What does this mean for you in practice? That tax deductions will logically be the largest in the first years and will gradually decline. It is good to count on this in the future and not let yourself be appeased by how much you can save on taxes in general and plan the following years in terms of your budget and your spending accordingly.

It’s voluntary

Finally, it is good to add that the deduction of interest on the mortgage or building savings loan is voluntary. Those who do not want to deduct them – for example, because of low taxes, do not have to. When his tax return is regularly zero, it is quite unnecessary to deal with extra administration.

However, those who pay taxes will appreciate the advantage. If we look at some approximate calculations, it can be said that with an average mortgage, it is not a problem to save tens, but hundreds of thousands, all the time. In the first few years, tax reliefs amount to several thousand. Although they are gradually decreasing, but if the mortgage is negotiated for thirty years, it is a considerable amount of money, which may not get the state, but it remains just for you. In this respect, state housing support still works quite well.