Accounts Receivable Financing for clothing manufacturer
| Listing Information | |||
|---|---|---|---|
| Amount: | $15,000.00 | Status: | Loan created |
| Grade: | A | DTI: | 21% |
| Lender Rate: | 14% | Borrower: | rainypom |
| Finished | State: | WA | |
| Funded: | 100% | Group: | (No Group) |
| Loan Information | |||||
|---|---|---|---|---|---|
| Loan Status: | Current | Origination Date: | 2008-08-26 | EricsCC ROI: | 13% |
| Status History | |
|---|---|
| Aug 24, 2008 | Current |
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Purpose of loan: This loan will be used to cover a gap in cash flow for my business. I am starting a company that manufactures women's clothing. The photo on my listing is a photo of one of the garments I will be manufacturing. The bi-annual selling season of clothing manufacturing goes like this: I develop samples of the clothing These samples are used to sell the clothing to buyers of boutiques and department stores After orders are taken from the samples, I produce only what has already been sold After the garments are produced they are shipped to the buyers and accounts receivables are collected. This method of production minimizes my losses (by only making what I've already sold) but leaves me with about a 3 month gap in cash flow (time between production and shipment). All product development costs and overhead will be paid for out of pocket by me, with money from my day job. The money I am requesting to borrow for this loan will be used SOLELY for the materials and labor costs of production. Any other overhead or intagibles are paid out of pocket by me. I plan to pay this loan off by October 2009, after payment payment is collected from my buyers. To further protect myself I will not be extending terms (net 30, net 60, etc.) to any buyers, all payment will be due upon shipment. Education: I have an AA in business administration and a degree in fashion design. I am also working closely with a consultant to guide me through this process. My financial situation: I am a good candidate for this loan because I am employed full time, and live very frugally. I'm single with no dependents and I don't drive a car. I rent a small room instead of an apartment. Here is my monthly breakdown: Monthly Income (after tax): $2400 Retirement Savings: $200 Rent: $225 Cell Phone: $55 Which leaves $1920 left in disposable income. This is more than 3x the amount of the monthly loan installment ($15000 at 20% interest is about $550 per month). Though propser states that my DTI is fairly high, you can see that I am used to living off of a fraction of my salary. I do have one past deliquincy on my credit report, from a store credit card that I was led to believe I had closed but still had a $7 balance. I never received any statements in the mail and it went into collections, when I received the phone call it was paid off right away. This was about 3 years ago. Other than that my credit history is perfect, I have never carried a balance on my credit cards and am very financially responsible. |
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