WA State Department of Revenue released in its 2008 year end report the following business statistics:

Gross Business Income was reported at over $627 billion, an increase of 2.7% or $16.8 billion compared to 2007.  Overall in 2008 there was small growth during the year 2008.

Food products were up 14% or $1.3 billion, wholesaling (electronics, agents, and brokers) up 8% or $800 million, and business, personal, and other services, up 8.6% or $9.2 billion.

New and used Auto dealers reported a loss of 19.6% income (approx. $3 billion), lumber and wood down 12.9% (approx . 1.2 billion) , and construction down 1%, approximately $400 million.

A recent report from the Bureau of Labor and Statistics reports that 1/3 of all new businesses fail within the first two years, mainly because the owners did not correctly calculate how much it would take to start the company and keep the doors open long enough to start turning a profit.

When starting a business, proper funding is paramount.  The Small Business Administration, SCORE, and other entities who help entrepreneurs, make templates available to help you estimate start up costs, as well as the various fixed and variable costs of operation.

These groups also suggest you take six months of operating costs and add that to your estimated start up costs to determine the amount of equity or funding you'll need before you open your doors.  It's important to make that capital available before you open the doors if you don't want to be part of the statistic mentioned above.

For a basic start-up cost estimate template click here.

For a 12 month operating and cash flow projection click here.

For more information on how you can start your own business visit our section on Business Formation.

Small businesses account for 75% of all businesses in the U.S. and more than $800 Billion in revenue each year. And that number is on the rise!

Recent economic conditions have made starting a business an easier decision than ever.  With massive corporate layoffs and uncertainty in the job market, career employees are now, more than ever, opening their own shops and taking their products and services directly to the public.

Technology has made business a 24/7 marketplace.  Online spending has reach new heights and the ease at which one can start a new business is staggering.  With the right paperwork and a little internet savvy you can have your very own company, website, and email.  Virtually everything the larger companies offer, but for a fraction of the price.

In Washington State alone, small business are 95% of all businesses.  Over 98% of all new employees hired in 2008 in the state are attributed to small business hires.

To learn more about starting your own business visit Cornerstone's New Business Services Section here.

Some of the most asked questions we get are related to hard money loans and the process involved in arranging them.

At Cornerstone, we've worked with many hard money lenders from the smallest, private one-person firms to the largest corporations.

Regardless of size, most are asset based lenders, meaning their loans are based purely on the value of the asset being pledged as security. Typically hard money lenders will lend a maximum of 50-65% of the "as is" value of the asset (its current value in the market place).

For this reason, hard money lenders are less concerned with things like the borrower's credit score, personal financial status, or cash reserve position.  This is mainly due to the fact that if the lender has to take back a property encumbered by a loan of only 50-65% of its fair market value, they would likely recoup their money by selling the property, even if it were sold at a steep discount.

With such a low loan to value ratio hard money lenders have a relatively low risk position and can afford to be more lenient with underwriting guidelines than a conventional commercial lender, requiring much less upfront documentation from the borrower, and therefore responding much more quickly.

In general, very few documents are actually needed to facilitate a hard money loan.  In the case of a stabilized commercial property the lender will look for current and historical income and expense statements, clean title, and a recent appraisal.  For land loans they'll focus much more closely on establishing an appropriate value so they'll spend more time reviewing the appraisal.  In the case of construction loans, they'll be concerned not only with the current value of the property, but also with the value of the property once construction has finished.

Many hard money lenders draw their funds from conventional sources such as other banks, lines of credit, hedge funds, etc. and have a cost associated with the capital they borrow.  To make a profit, they need to relend that money at a sufficient spread above their own cost of capital.  As such, hard money loans are typically more expensive loans to carry both in origination and interest rate.  It's not uncommon for hard money lenders to charge between ten and fifteen percent interest per year and two to ten points in origination.

What they lack in pricing they make up in speed.  Most hard money lenders review loan requests and issue letters of interest or pre-approvals within 48 hours.  In addition, title and appraisal can be ordered and received within seven to ten days.  If all is satisfactory, closing can be schedule soon thereafter, sewing up the entire process in as little as two weeks.

For more information about hard money loans or to submit your project for review, view our hard money loan guidelines or contact us at your convenience.

Financing solutions could exist for clients who might otherwise pass on a good deal

Thus, many would-be property-buyers sit on the sidelines to wait out the market, and the volume of brokered deals is decreasing significantly. As a mortgage broker, however, you can help your clients move forward with their deals by helping them find private equity.

Read the full article here: http://www.scotsmanguide.com/default.asp?ID=3435.

The financial statement is one of the most important documents in the commercial lending world and the sooner you put your statement together the better.

Both individuals and companies can have a financial statement, and it's main role is to list your assets and liabilities, which reconcile to show net worth. Net worth demonstrates to lenders your financial backing and wherewithal. Some lenders will limit the maximum loan amount to your net worth, ensuring they have sufficient collateral to take from you in the event of a default.

Banks, in particular, look for clients with high net worth. Knowing that the client has reserves to fall back on lowers the risk in lending, and allows banks to pass on to the client the best rates and programs available.

Businesses with high net worth will always be able to obtain larger lines of credit, and often without personal guaranty from the business owners. This allows the business to hold assets on its own, without the owners having to risk losing personal property or pledging collateral like stock or cash.

You should update your financial statement at least once a year, though many people choose to do it each quarter. At the very least, you should update your statement when there is a drastic change in your asset or liability values, as these will affect your overall net worth.

Cornerstone has created a universal financial statement template in spreadsheet form, which can be easily filled out, updated, and saved in several formats. We have used this form with lenders across the country for personal and business loans as well as government sponsored loans.

You can purchase and download the template from the Cornerstone Online Store here.