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16 P2P lenders you didn't know existed
welcome to the cashflow diary daily. Yesterday it was all about investors; today, we tackle lenders.
in this issue…
your opportunity to build your short-term rental income with live training.
a month-long celebration of content and information provided for free.
p2p lenders for you to contact.
a guide to help you work with lenders right now.
premium members: download: how to raise private capital
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Topics Often Covered
Gaining higher quality reservations.
Building networks of referrals faster.
Increasing the rate of higher review scores.
Increasing the frequency of return visits.
How to leverage others’ capital.
Researching the best locations for your short-term rental.
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April 1st, 2nd, and 3rd: Capital and Funding: Obtaining the necessary capital or funding to start a short-term rental business is often the most urgent concern, as it directly impacts the ability to acquire and set up properties.
April 4th: Operational Excellence: Business Strategy 101 with Dr. Jawn Lam
April 5, 6, and 7th: Marketing and Lead Generation: Attracting clients and increasing bookings is a priority for new operators, as it directly impacts revenue generation and the business's overall success.
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16 P2P lenders you didn’t know existed
LendingClub - A popular P2P lending platform connecting borrowers and investors online. https://www.lendingclub.com/
Prosper - Another well-known P2P lender offering personal loans with competitive rates. https://www.prosper.com/
Funding Circle - A platform that connects small business owners with investors for funding. https://www.fundingcircle.com/
Kiva - A non-profit P2P lending site that allows individuals to lend as little as $25 to entrepreneurs and small business owners in developing countries. https://www.kiva.org/
Bitbond - A P2P lending platform that uses bitcoin for loan transactions. https://www.bitbond.com/
Mintos - A European P2P lender offering loans from various loan originators to investors. https://www.mintos.com/
CircleUp - A P2P lending platform that connects investors with consumer and retail companies seeking funding. https://circleup.com/
Assetz Capital - A UK-based P2P lender offering loans for businesses and property development projects. https://www.assetzcapital.co.uk/
Bondora - A European P2P lending platform offering personal loans and investments in consumer loans. https://www.bondora.com/
Huddle - A P2P lending platform that connects investors with borrowers seeking loans for sustainable projects. https://huddlecapital.com/
Money360 - A P2P commercial real estate lending platform that offers loans for various types of commercial properties. https://www.money360.com/
Crowdestor - A European P2P lending platform offering loans for real estate development, business loans, and other investment opportunities. https://crowdestor.com/
YieldStreet - A platform that connects investors with alternative investment opportunities, including real estate, art, and marine finance. https://www.yieldstreet.com/
Grupeer - A European P2P lending platform offering loans for real estate and business projects. https://www.grupeer.com/
Groundfloor - A P2P lending platform that offers short-term loans for real estate investors. https://www.groundfloor.com/
Ablrate - A UK-based P2P lender offering loans for aircraft leasing and other asset-backed lending opportunities. https://www.ablrate.com/
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lenders and lending in the short-term rental industry: a comprehensive guide
The short-term rental industry has experienced significant growth over the past decade, fueled by the rise of platforms like Airbnb and Vrbo. Property owners and operators need access to capital as the industry evolves to grow and maintain their businesses.
Lenders and lending can play a critical role in providing these financial resources. Let’s explore the concept of lenders and lending, how they work, and when it's best to use them.
Also, I’ve included three examples of how lenders can support the short-term rental industry. (Premium members, you have a bonus waiting for you.)
What are Lenders and Lending?
Lenders are financial institutions, such as banks, credit unions, or online lenders, that provide loans to individuals or businesses. Lending refers to providing these loans, typically in the form of money (did you see the lender of bitcoin in the list above?), which borrowers agree to repay with interest over a specified period.
Before approving the application, lenders assess the borrower's creditworthiness, financial history, and loan repayment ability. The lending process aims to create a mutually beneficial relationship where lenders profit from interest and borrowers gain access to funds needed for various purposes.
How Lenders and Lending Work
Lenders follow a specific process to provide loans:
Application: Borrowers submit an application detailing their financial information, loan purpose, and desired loan amount.
Evaluation: Lenders assess the borrower's creditworthiness by examining credit scores, debt-to-income ratios, and financial history.
Approval: If the borrower meets the lender's criteria, the lender approves the loan and provides the borrower with the loan terms, including interest rates and repayment schedule.
Disbursement: Once the borrower agrees to the terms, the lender disburses the funds, which can be used for the intended purpose.
Repayment: The borrower repays the loan principal and interest over time, adhering to the agreed-upon repayment schedule.
When to Use Lenders in the Short-Term Rental Industry
Lenders can be an attractive financing option for short-term rental operators in various scenarios:
Acquiring new properties: When operators want to expand their portfolio by purchasing additional properties, a lender can provide the necessary funds through a mortgage or business loan.
Renovations and upgrades: To improve the rental property's appeal and increase occupancy rates, operators might require financing for property renovations or amenity upgrades.
Working capital: Short-term rental operators may need loans to cover operational expenses, such as marketing, property management, or maintenance costs.
Three Examples of Lenders in the Short-Term Rental Industry
Traditional Bank Loans: Many banks offer loans specifically designed for short-term rental businesses. These loans can provide capital for property acquisitions, renovations, or operational expenses. The borrower must have a strong credit history and demonstrate their ability to repay the loan.
Online Lenders: Online lenders such as LendingClub, Kabbage, and OnDeck offer short-term rental operators quick access to funds through a streamlined application process. These lenders often have less stringent eligibility requirements than traditional banks but may charge higher interest rates.
Government-backed Loans: The Small Business Administration (SBA) offers government-backed loans to support small businesses, including short-term rental operators. SBA loans typically have lower interest rates and longer repayment terms, making them an attractive option for eligible borrowers.
BONUS FOR Premium Members: Download the resource on how to raise capital. It is at the bottom of this issue.
Lenders and lending can play a pivotal role in supporting the growth and success of the short-term rental industry. By understanding the different types of lenders, their lending processes, and when to use them, short-term rental operators can secure the necessary funding to expand their businesses, improve their properties, and cover essential operational costs.
As the short-term rental market continues to grow and evolve, having access to reliable financing options will become increasingly important for operators to remain competitive and thrive in this dynamic industry.
Short-term rental operators need to evaluate their options when seeking financing carefully. Factors to consider include interest rates, repayment terms, and the overall cost of borrowing.
By thoroughly assessing their financial needs and understanding the various lending options, operators can make informed decisions that best align with their business goals and objectives.
Moreover, operators should continually monitor their financial performance and adapt their strategies. This proactive approach will enable them to make timely decisions about seeking additional financing or adjusting their operations to maintain a healthy financial position.
Lenders and lending play a crucial role in the short-term rental industry by providing operators with the financial resources needed to grow, innovate, and maintain their businesses.
By understanding the ins and outs of lending and evaluating their options, short-term rental operators can leverage financing to maximize their potential for success in this rapidly expanding market.
move at the speed of instruction:
work with lenders; follow these steps
Step 1: Review Credit History
Obtain a detailed credit report and review it for accuracy and completeness.
Identify any factors impacting your creditworthiness, such as outstanding debts or late payments.
Develop a plan to address any issues and improve your credit score.
Step 2: Prepare Financial Statements
Prepare accurate financial statements showing income, expenses, assets, and liabilities.
Create a profit and loss report, balance sheet, cash flow projection, and any other relevant documents that can assist in evaluating the borrower’s creditworthiness.
Step 3: Develop a Business Plan
Develop a comprehensive business plan that outlines your target market, marketing strategy, competitive advantage, and financial projections.
Include detailed information on the short-term rental market in your target area, including demand, competition, and pricing.
Step 4: Provide Additional Documentation
Provide additional documentation related to occupancy rates, revenue, and expenses specific to the short-term rental industry.
If collateral is needed, provide a Uniform Commercial Code (UCC) filing as collateral for the loan.
Step 5: Offer Guarantees
Consider offering a personal guarantee to the lender indicating your commitment to repaying the loan.
Provide additional collateral, such as rental properties or vehicles, if needed.
If the collateral is in the form of a UCC filing, understand how to obtain and release the filing.
Step 6: Assemble Loan Package
Assemble all documentation into a loan package for submission to the lender.
The loan package should include a comprehensive business plan, financial statements, and other necessary documents demonstrating the borrower’s creditworthiness.
Step 7: Submit the Application
Once all necessary documents have been collected and the loan package is complete, submit the loan application to the lender.
Use clear and concise language when submitting the application so the lender can easily understand it.
Step 8: Follow Up
After submitting the application, contact the lender and follow up on any outstanding questions or requests for additional information.
Ensure you are present to answer any questions the lender may have about your business plan or loan package.
Step 9: Accept Loan
Upon loan approval, sign all necessary documents and accept the loan.
Review all documents thoroughly before signing, and ensure you understand all terms, conditions, and repayment schedules.
Step 10: Monitor Performance
Once the loan is accepted and payments begin, monitoring performance closely is essential.
Track cash flow, income, and expenses regularly and adjust budgeting accordingly.
Continue to assess the value of the collateral periodically to ensure that it remains sufficient to secure the loan in case of default.
Stay up-to-date on credit reports to ensure the loan is repaid as agreed.
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premium member content:
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2. what are the benefits for a short-term rental operator to work with a lender, and why should short-term rental operators consider a lender instead of a investor?
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