September 19, 2018, 1:34 PM
Precious capital is always a source of concern for businesses. How and when you finance your operations can make the difference between success and failure. While any money infused into your company may seem like a plus, there are different sources of small business funding, some better than others.
Fortunately, you have many options when it comes to getting your business off the ground and accessing working capital. Here are some of the most common sources of small business funding. Depending on your situation, there should be one or several that will suit your needs.
Self Funding. This entails spending your own money to finance your business. You can tap into your savings, a retirement fund, or the equity in your home to raise cash for your small business. All of these options are risky, and some could involve penalties.
Family and Friends. Another risky option is to ask family and friends to help fund your business. If you do this, be sure to draw up a contract to make the loan official.
Credit Cards. Many small businesses are funded, at least in part, by credit cards. This is a high-interest option but one that provides fast access to cash when needed. It might also involve intermingling personal and business expenses.
Crowdfunding. If you have a unique and attractive business idea, you may be able to raise funds for your startup through a crowdfunding campaign which involves donations.
Angel Investors. Provided you expect your business to "take off" in the future, angel investors may be willing to fund your startup with the expectation of a high return on their initial investment.
Venture Capitalists. Venture capitalists are similar to angel investors but, instead of being individuals, most are investment banks and other consortiums who agree to invest in your company in exchange for a percentage ownership of the organization.
Traditional Bank Loans. Most small businesses turn to traditional bank loans for business capital. There will be some requirements, including having a strong business plan to present as well as an outline of how you plan to spend the money you borrow. Ready to apply for a business loan? Here are several tips to help you prepare a small business loan application.
Commercial Real Estate Loans. If your plans involve real estate, there are commercial options available for mortgages as well as construction loans.
Commercial Lines of Credit. Working capital is essential for any business, and you can access this with a secured or unsecured business line of credit. This will provide your company with funds whenever the need arises.
City Bank Commercial Lending
Whether you need capital for equipment, inventory, or other stages of growth, City Bank has several commercial lending programs that can help you meet your small business goals. Contact us now by calling 1-800-OUR-BANK or visit one of our branches to get started.
August 22, 2018, 9:18 AM
The news has been abuzz about the slow and steady uptick in interest rates recently. If you are ready to buy a home, now is the time. But, what if you are already own a home? Should you still consider refinancing your mortgage? The answer is "Yes!" This could be the perfect time to refinance your mortgage if any of the following apply to your situation or goals for the future.
1. Get a lower interest rate
It's almost always beneficial to refinance your mortgage if the new interest rate is going to be lower. This will reduce your monthly payment and require you to pay lower overall interest on the loan.
2. Change your loan term
One of the things that you can accomplish with refinancing is changing your loan term. You can shorten the term of your mortgage so that you will pay less overall interest and pay off your mortgage quicker. You can also lengthen the term, which could reduce your monthly payments.
3. Change your loan product
There are many ways that you can refinance a mortgage to change your loan product. For example, you can change from a fixed-rate to a variable rate loan, and vice versa. You can also change from a conventional to an FHA loan. You can also make a switch from a conventional loan to an interest-only loan, and vice versa. Which options are available to you and which are in your best interests will depend on your individual circumstances.
4. Alter your buyer profile
Has your income and credit score substantially improved since you first took out a mortgage? If this is the case, you may be able to secure much better terms by refinancing your loan.
5. Remove or add someone
If you are getting a divorce or have been recently married, you can refinance your mortgage to either remove someone from or add another party to the loan.
6. Consolidate multiple mortgages
If you have multiple mortgages on your home, the subsequent ones probably have high interest rates. Often, you can refinance your mortgage to consolidate all of those loans into one, with a more affordable rate.
7. Free up some cash
If you have equity in your home, you can refinance your mortgage and receive cash back. You can use this money for a variety of purposes such as debt consolidation or a major home renovation project.
Choose City Bank to Refinance Your Mortgage
Home loan refinancing can provide many benefits to homeowners. If you want to lower your rate, pay off your home sooner, or free up some cash, City Bank Mortgage can help.
Contact us today to learn more about your home refinance options. Either come into one of our locations, give us a call at 1-800-687-2265, or start your application online now.
August 15, 2018, 7:51 AM
While a vast majority of Americans still believe that a college education is important, only about half have enough savings to pay for a child's education. Footing the bill for college can be daunting, but it can be done with some planning.
Many families are more determined than ever to avoid the mountains of student debt that linger for decades after receiving a degree. Fortunately, you can save some cash right away on college expenses by learning and following a few simple tricks.
1. Create a Budget.
College on a budget means just that - creating and using a budget. Fortunately, technology now makes this easy with free online programs and apps. Check out Mint.com as well as the Money Manager feature that you receive with City Bank's Online Banking.
Credit cards can be risky and tempting when you are young. Instead, it might be a better idea to open and use City Bank's interest-bearing checking account for unexpected expenses.
2. Be Smart About Course Enrollment.
Choosing the wrong classes or enrolling in too many courses at once can be a costly mistake. To avoid having to drop or repeat courses and lose money, students should schedule frequent appointments with academic advisors and even test out of classes when possible.
3. Rent or Buy Used Textbooks.
The average student spends roughly $1,200 per year on college textbooks. This is an enormous cost even if you've saved for other college expenses. You can save a significant amount of cash by never buying a new textbook if you have other choices.
First, see if you can find the textbook at a used bookstore or even used online. Some bookstores also rent textbooks for the semester at a lower cost or sell a digital version of the book. Once finals are complete, don't forget to sell your books back for some cash to use towards next semester's expenses.
4. Leverage Your Student ID.
Student ID's can provide you with a ton of discounts. These aren't just on a college campus, but worldwide. Your student ID can unlock travel discounts, cheaper movie tickets, cell phone plans, and a special Amazon Prime plan. It never hurts to ask about a student discount.
5. Participate in Campus Events.
Attend campus activities and events that interest you. This is not only good for you, but many of these events also hand out free food and other goodies that can help you save some cash.
6. Become a Resident Assistant (RA).
Once you've completed your freshman year, you can apply to be an RA. This is supervisory position in the dorms that often entitles you to either a discount or even free room and board.
How Can We Help?
From checking and savings accounts to personal and auto loans, City Bank is ready to meet your college back to school and student banking needs. Visit any of our branches, give us a call, or open an account online today.
August 02, 2018, 9:00 AM
Buying a car, whether new or used, can be a stressful and challenging experience. Many people are reluctant to negotiate auto deals for fear that they won't get the best terms.
One of the ways that you can protect your financial interests is to learn as much as possible about the process of financing a vehicle. It also helps to walk into a dealership with a pre-approval for a loan. If you're ready to buy your next vehicle, here is what you need to know about financing a car.
Determine your budget.
Before you purchase or shop for a vehicle, it's helpful to sit down and thoroughly assess your budget. Figure out what you can comfortably afford to pay each month for a car payment. From this, you can figure out how much car you can afford, or a lender will be happy to help with this calculation.
Get approved for an auto loan.
You will have much more leverage in purchasing a car if you are pre-approved for financing before you shop.
When you take out an auto loan, you will make payments on that loan over an agreed period until the loan, plus interest, is satisfied. The lender will hold a lien on your vehicle until you pay your loan in full.
Understand the Terms of your loan.
When you get an auto loan, ask the lender to explain the details so that you understand your obligations and the implications of your choices. The "term" is the length of time that you have to pay back the loan.
While a longer term (61-72 months) will give you a lower monthly payment, it also comes with a higher APR. The APR is the annual percentage rate on the loan. The shorter your term and the higher your credit score, the lower your APR.
Make a Down payment on the car.
You may be required to make a down payment on the next vehicle you purchase. Since new cars immediately depreciate in value (as much as 40% in the first three years), this down payment helps protect the lender from that offset.
When you pay more for the car upfront, your monthly payment will be less. In some cases, any trade-in value will count as a down payment. What a lender requires, if anything, could vary depending on your credit score.
Finance a New or Used Car with City Bank
If you are looking to buy a new or used vehicle, or would simply like more favorable terms on your current vehicle loan, City Bank has a wide range of auto loans that can help. We are committed to offering our customers the best auto loan to suit their needs at competitive rates.
Learn more about our auto loan program or apply now for pre-approval online, at one of our locations, or by calling 1-800-OUR-BANK.
July 26, 2018, 1:30 AM
The dream of homeownership is now even more attainable with a new program from Freddie Mac. In April, the nationalized housing agency rolled out one of its most generous programs since its similar move in 2015. If you want to buy a home and have either struggled to come up with a sufficient down payment or worry about income requirements, this could be the perfect opportunity.
Freddie Mac's HomeOneSM Mortgage
Freddie Mac is already known for having some progressive programs aimed at new homebuyers and affordable homes. Its recent program, called Home Possible, has a loan-to-value (LTV) cap of 95%. Another program, called Home Possible Advantage, raises the cap to 97%. However, both have income limits.
Now that there is a shortage of affordable homes, potential homebuyers are finding it more difficult to save for an appropriate down payment. In response, the agency has launched its HomeOne program, which also has an LTV of 97%, but no income restrictions.
What Are the HomeOne Mortgage Requirements?
While other mortgages have limitations based on geography and income, the new HomeOne program eliminates these restraints. You will still need to put 3% down on the home, meaning the LTV should be 97% or greater. Other features and requirements of this program include:
The home must be owner-occupied
Homes can be single-family, townhomes, and condos (no manufactured homes)
Must be a fixed-rate mortgage
Must be a home purchase transaction or a refinance (no cash out)
At least one borrower must have a minimum credit score (estimate of 620 or higher)
There is no minimum buyer contribution, meaning the 3% can come from gift funds
HomeOne will require buyers to carry private mortgage insurance (PMI)
One Borrower Must Be a First-Time Homeowner
Another requirement of this program is that at least one of the borrowers must be a first-time homebuyer. In general, this is considered to be a person that has not owned a property in the past three years. If both borrowers are first-time homebuyers, they will need to complete homeownership education before closing.
Contact City Bank Now to Discuss Your Mortgage Options
While it was announced in April, the HomeOne program will become available to homebuyers in July 2018. If you are ready to buy a home or are interested in researching your mortgage options, City Bank can help. We have access to Freddie Mac's programs as well as a variety of other mortgage products. One of our mortgage lenders can speak to you about your goals and help you choose the most beneficial mortgage.
Contact City Bank now to complete an application or receive answers to your mortgage-related questions.
*This is not a commitment to lend. All loans are subject to credit approval, terms and conditions may apply. Must meet all qualifications.
July 10, 2018, 9:53 AM
It's prudent to have a financial buffer available that will sustain you when unexpected expenses occur or other emergencies materialize. If your car breaks down, you receive a large medical bill, or unexpectedly lose your job, having cash on hand is a better way to deal with these issues than using high-interest credit cards or having to take out a loan.
You can start preparing by creating an emergency savings account and putting money aside for financial emergencies. How much you need to save depends on your circumstances, but a general rule of thumb is to aim for three to six months' worth of living expenses as a buffer.
Here are five tips that can help you reach the goal of accumulating this vital cash reserve.
1. Take it Day by Day
Setting aside several months' worth of expenses at once can seem overwhelming. If you approach reaching your goal by taking small steps, it is much more palatable. For example, instead of thinking about setting aside $100 a month, look at it as just $25 per week or even $3 each day.
2. Cut Some Expenses
If you're going to save $3 a day, you'll need to find something to eliminate from your daily spending. It could be as simple as forgoing the daily stop at the coffee shop or taking your lunch to work instead of eating out. Otherwise, look through your budget and see if there is something you're paying for that you're not using. If so, stop wasting that cash and put it towards your savings fund.
3. Simplify Your Savings
One of the easiest ways to consistently save money each month is to make it automatic. Set up a direct transfer, either from your paycheck or your checking account, into your emergency savings account either monthly or every pay period.
4. Erase High-Interest Debt
Saving can be difficult if you have mounds of high-interest debt. If you are in this situation, allocate a majority of your funds to paying down debt with the rest going into your emergency savings account for future expenses.
5. Choose a Separate Account
Just padding your checking account in an effort to "save" can present too much of a temptation. Emergency funds should be in a separate savings account that is also accessible in a time of need.
City Bank - Earn Interest While You Save
An emergency savings account is a financial safeguard that will also provide you with peace of mind knowing that you can meet an unexpected expense. Fortunately, you can also earn interest on those funds with a no-fee or low fee savings account from City Bank.
Stop by your local City Bank branch location, call 1-800-OUR-BANK, or open your account online now.