Business Credit Cards

July 19, 2019

The Complete Guide To Home Equity Loans For Business Purposes

Are you ready to launch a new business, but don’t know to fund your idea? Or are you a small business owner ready for expansion who lacks the capital you need to grow?

Sure, small business loans are an option, but simply owning a business — or hoping to start your own business — doesn’t automatically qualify you for this type of financing. A lack of business credit history, a short time in business, or low revenue may prevent you from getting a small business loan. Even if you do qualify, you might get stuck with short terms and high fees and interest rates.

Don’t give up hope just yet, though. If you own your own home, there could be another funding option you’ve not yet considered: obtaining a home equity loan for business purposes. You can leverage the equity in your home to get lower rates, longer repayment terms, and higher borrowing limits than you might with small business lenders.

Sounds great, doesn’t it? Unfortunately, not everyone will qualify for a home equity loan. Others may find that a small business loan, personal line of credit, or another form of funding is better suited for their capital needs. However, if you’re looking for a creative way to finance your startup or expansion plans, read on to learn more about home equity loans and if one is right for you.

What Is A Home Equity Loan?

A home equity loan is also known as a second mortgage. To understand a home equity loan, let’s first take a look at equity. As you pay down the balance of your mortgage, you build up equity. Equity is the difference between what is owed on the home and the value of the property. For example, let’s say your home is valued at $500,000. If your first mortgage has a remaining balance of $200,000, then the equity in your home would be $300,000.

Another way to look at equity is that it is the portion of the home that you own. With a home equity loan, you can use your equity as collateral for an additional loan. If you don’t have equity in your home — that is, the value of your home doesn’t surpass the amount owed on your first mortgage — you will not qualify for this type of loan. Generally, you can expect to receive about 80% to 85% of the value of your home as a lump sum, less the amount still owed on your first mortgage. This money can be used to fund large purchases for your business, including startup costs, new equipment, facility upgrades, or purchasing commercial property.

After receiving your funds, you’ll repay the loan over a longer period of time — usually 5 to 15 years. Home equity loans come with fixed rates and are repaid on a monthly basis.

Equity Loans VS HELOCs

Another type of funding that uses the equity in your home is a home equity line of credit, or HELOC. Similar to an equity loan, a HELOC uses the equity in your home as collateral. However, instead of receiving a lump sum, you get access to a line of credit that you can use for business purposes.

After being approved for a HELOC, you’ll be able to withdraw funds up to and including the credit limit set by your lender for a set period of time — typically a year. When this draw period is over, you’ll enter the repayment phase. At that time, you’ll begin to repay the amount of money borrowed (plus interest). Once you’ve repaid borrowed funds, you’ll be able to borrow funds again.

Most HELOCs come with variable interest rates, whereas most home equity loans have fixed rates. While this provides stability, often you’ll find that home equity loans have a higher interest rate than HELOCs.

If you have a larger purchase to make, such as buying equipment or purchasing real estate, the lump sum offered through a home equity loan is the wiser choice. If you want a more flexible funding option for working capital, hiring new employees, or purchasing inventory, a HELOC may be the better option for your business.

Equity Loans VS Business Loans

A home equity loan is similar to a business loan in a few ways. With both types of funding, you receive a lump sum that can be used to fund your business purchases. Many small business lenders also offer low, fixed rates, long repayment terms, and monthly repayment schedules.

However, there are also a few distinct differences. With a home equity loan, the equity in your home serves as the collateral for the loan. For business loans, other forms of collateral may be used, including business equipment or real estate. You may also be required to sign a personal guarantee or agree to a blanket lien.

Borrower requirements also differ. When you apply for an equity loan, the lender will consider factors including your personal credit profile, your debt-to-income ratio, and the amount of equity in your home. Small business lenders may consider factors including personal credit, business credit, annual revenues, and time in business.

When Should Merchants Use A Home Equity Loan?

Each business is unique, which is why one source of funding doesn’t work for everyone. However, there are many small business owners that will find that a home equity loan is a viable way to access capital.

If you haven’t yet opened the doors to your business because of startup costs, a home equity loan may work for you. No time in business, business revenue, or business credit history is required to qualify.

A home equity loan may be a good choice for you if you want a low-cost loan option. If you’ve shopped around for other financial products and aren’t satisfied with short terms, high interest rates, excessive fees, or repayment schedules, a home equity loan could give you the affordable capital you’re looking for. You’ll receive a low fixed rate and a longer period of time to repay your loan. You may even qualify for additional savings if you work with the lender of your first mortgage.

However, there are also times when maybe a home equity loan isn’t the best fit. If you have an established business and a solid personal credit profile, you could qualify for other types of funding such as Small Business Administration loans. These loans come with low interest rates, repayment terms up to 25 years, and are easier to qualify for than traditional bank loans.

You may also explore additional funding options if you need more specialized financing. For example, if your business needs new equipment, equipment financing may be a better option. You could potentially qualify for low rates and favorable terms without putting your personal assets on the line. With equipment leases, you can even turn in your equipment and enter another lease for new equipment — a smart idea if you need to upgrade frequently.

Finally, a home equity loan won’t work for borrowers with a poor credit score or a spotty credit history. Most lenders look for a good credit score in the 700s, although some may work with fair credit borrowers. However, borrowers with lower scores frequently need more equity, a lower DTI, and must meet other requirements to qualify. Your application may also be declined if you have a recent bankruptcy or foreclosure, defaults on past loans, or other negative items on your credit report.

Home Equity Loans For Business: Pros & Cons

By now, you should have a good understanding of what a home equity loan is, how it can help your business, and what you need to qualify. If you’re still on the fence about submitting an application, consider these pros and cons before making your decision.

Pros

Low Interest Rates: Low interest rates mean that your cost of borrowing is lower. You could save thousands of dollars in interest by taking out a home equity loan versus other types of funding.
Long Repayment Terms: Most home equity loans have repayment terms of 5 to 15 years, although this varies by lender. With a longer repayment term, you can stretch out the cost of your business expenses through easy, manageable payments.
Startup-Friendly: Since factors like time in business aren’t a consideration for approval, startups and new business owners may qualify when other lenders turn them down.
Flexibility: You aren’t restricted in how you use the funds from your home equity loan.
High Borrowing Amount: Depending on the amount of equity you’ve built up in your home, you could qualify for a larger sum of money than other lenders offer you.

Cons

Risk Of Losing Your Home: If you pay your home equity loan as agreed, you won’t have any problems. However, if you default on your loan, you risk losing your home.
Fees: There are associated costs and fees with taking out a home equity loan, so be prepared. This may include application fees, closing costs, and prepayment penalties for paying your loan off early.
Going “Upside Down”: If the value of your property drops after taking out a home equity loan, you risk being “upside-down” on your loan. This means that you owe more than the property is worth.

Alternatives To Home Equity Loans

Still undecided if a home equity loan is right for you? This funding certainly isn’t for everyone, and you may find that another financial product is better suited for your needs. Before taking the leap into a home equity loan, consider these alternatives and whether one may be right for you.

Business Lines Of Credit

With a business line of credit, you’ll have access to funds that you can use as needed. Your lender will set a credit limit, and you can make draws up to this credit limit. As a form of revolving credit, your funds become available to use as you pay off the borrowed amount, giving you continuous access to cash when you need it.

If you need access to cash on-demand, a business line of credit may be a more suitable choice than the lump sum offered through a home equity loan. You may also consider a business line of credit if you don’t own your own home or don’t have enough equity.

This may also be an option for borrowers with a poor credit profile, as some lenders may consider the performance of your business when approving your application. However, if you don’t meet time in business or revenue requirements, your application will be declined. You’ll also find that many business lines of credit have higher rates and fees and shorter terms than home equity loans.

Invoice Financing

If unpaid invoices are causing cash flow issues, consider invoice financing. With this service, you’ll receive a portion of the outstanding funds upfront — usually 80% to 90% of the invoice total. Once the invoice is paid, you’ll receive the remaining funds, less any fees charged by the lender. Your invoices serve as the collateral.

This is an option typically available to B2B and B2G businesses. You may also have to meet other requirements in terms of revenue, time in business, and the quality and quantity of invoices. Invoice financing is a great way to get access to cash. However, be aware that this can be an expensive form of borrowing depending on the factor rate assigned by your lender. This is also a short-term solution, so if you need longer repayment terms, consider applying for a home equity loan or another financial product.

If you have recurring expenses that require a more flexible form of funding, consider applying for a business credit card. With a business credit card, you can make as many purchases as you need up to your assigned credit limit. Qualifying for a business credit card is fast, and you can begin using your card immediately without waiting for further approval from the lender.

You may even consider applying for a rewards card, which scores you cash back or points to apply toward rewards like travel, shopping, and more.

High interest rates are a drawback of some business credit cards. For larger purchases, another form of funding may be more affordable.

Small Business Administration (SBA) Loans

Small Business Administration (SBA) loans offer high borrowing limits and low interest rates to fund business expenses. SBA loans have similar rates and terms to traditional bank term loans. However, these loans are backed by the government, making it easier for small business owners to qualify.

There are many different types of SBA loans, from smaller microloans to the popular SBA 7(a) loans that provide up to $5 million repaid over a period of up to 25 years.

In order to receive an SBA loan, factors including time in business and personal credit history will be considered. The process for receiving an SBA loan is lengthy and can take 30 days or longer from application to funding. However, this may be a great alternative if you don’t own your own home or don’t have enough equity to qualify for a home equity loan.

Final Thoughts

A home equity loan certainly has its benefits — startups can qualify, interest rates are low, and terms are favorable. However, there may be other options that make sense for your business. As with any other loan, shop around your options, compare lenders, and understand the terms of your loan before signing a contract.

The post The Complete Guide To Home Equity Loans For Business Purposes appeared first on Merchant Maverick.

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July 18, 2019

How Much Money Do You Need To Start A Business?

Startup capital is a necessity for virtually all businesses. However, the cost to start a business varies widely depending on what kind of business you are starting. For example, a home-based endeavor such as a dropshipping company or an Amazon business can cost less than $1,000 to get off the ground; the same goes for a business that doesn’t require an office or much equipment, such as a pet sitting business. On the other hand, opening a business that requires more equipment and office space—such as an autobody shop or a coffee shop—could cost $100,000 or more.

In this post, I’ll go over the main costs associated with starting a business and what you can expect to pay for each of them.

Surprisingly, there aren’t too many official statistics available on how much it costs to start a business, probably because the costs vary so much. There was a study conducted by the Ewing Marion Kauffman Foundation way back in 2009 that found the average cost to start a business at that time was $30,000.

Below, we’ve put together our own startup business cost figures, but keep in mind that the amount you’ll spend will vary greatly depending on various factors, such as your industry and location.

Common Small Business Expenses

Startup Expense	Estimated Cost
Business Licenses & Permits	$200
Business Insurance	$1,000 (annually)
Equipment & Supplies	$10,000
Inventory	$1,500
Office Space & Utilities	$5,000 initially, then $2,000 monthly
Employees	$8,000 (monthly)
Marketing	$700 initially, then $200 monthly
Business Software	$200 (monthly)
Professional Services (e.g., legal services)	$600
Misc. Other	$1,000
Total estimated cost: $28,200

Business Licenses & Permits

As a new business owner, you will need to register your business in your state and apply for a local business license/permit in your city or county. Depending on your industry, you may also need to obtain an industry-specific business permit. These initial business registration costs are usually minimal (less than $500).

Business Insurance

There are several types of business insurance for startups and which type(s) you need depends on various factors. Insurance is a significant, ongoing business cost. Most businesses will need general liability insurance and business property insurance, and if you have employees, you will also need to pay for workers compensation insurance and health insurance. Commercial vehicle insurance and product liability insurance are some other business types you may or not need.

Equipment & Supplies

All businesses require some sort of equipment or supplies, but these costs vary significantly depending on what type of business you have. Examples of equipment and supplies include:

Restaurant kitchen equipment
Office furniture
Office supplies
Business vehicle(s)
Medical equipment & supplies
Computers
Product manufacturing equipment
Point of sale equipment (cash register, credit card reader, etc.)

The type of equipment and other materials you need to run your business really depends on your industry—for example, if you’re starting a wedding planner business, you’ll probably just need a computer and office supplies, whereas a trucking company will need commercial vehicles, etc.

Office Space & Utilities

If you need to rent or buy an office space, this will be a significant ongoing expense, and a big startup cost too, as you will need to pay a security deposit, first and last month’s rent, etc. Internet, gas and electricity, a business phone, and data plans will also factor into the infrastructure costs of your office space. Most businesses start out as home-based or rent a business space initially, instead of purchasing or building property.

Inventory

If you sell a physical product, you need a certain amount of inventory to start out with (and have on-hand on an ongoing basis). Retail stores need a certain number of finished products on hand, while food-based businesses such as food trucks, for example, need to stock up on raw ingredients before they can open up shop. This, of course, does not apply to information-based businesses, such as consulting businesses or various other service-based businesses.

Employees

You may or may not start your business with any employees. If you do have employees, you need to factor in payroll costs, payroll taxes, insurance costs (workers comp. and health insurance), and training costs.

Marketing

Modern business marketing includes not only business cards, advertisements, signage, etc., but also digital marketing costs such as SEO, social media marketing, and website maintenance costs. As far as your digital marketing, at the very least you will need a website and social media presence. Tip: Be sure you register your domain early on in the process of starting your business, as your website will be the foundation of your online marketing.

Business Software

Some different types of business software you might need to launch and run your business include:

Accounting software
Booking software
POS softwareÂ
eCommerce/shopping cart software
Invoicing software
Inventory software
ERP software
Website builder software
Project management software
Shipping software
Email marketing software
Industry-specific business software (for example, specialized software for dentists, auto mechanics, etc.)

Some small business software programs combine multiple functions. For example, a restaurant management software system might include POS functionality as well as accounting, inventory, employee management, and maybe even email marketing functions. An accounting program like QuickBooks combines accounting, payroll, and invoicing functions, with POS functionality as an add-on.

Generally, most business software apps are no longer large programs that you install onto a computer as a one-time expense; rather, today’s business software is usually app/cloud-based, meaning you can sign in from any internet-connected device. And rather than paying for the software as a large, one-time expense, today’s software-as-a-service (SaaS) model is based on monthly payments with no down payment or long-term commitment. So, initial investment for business software will likely be much less than you would have paid for a comparable program 15 or 20 years ago. Some business software is even free to use.

In addition to software, don’t forget to factor in the cost of the associated hardware you’ll need to run the software into your equipment costs. For example, most businesses will need point of sale equipment, a laptop or iPad, a wireless router, etc. For very small businesses requiring only a basic app to take payments, it’s possible that the only hardware you might need is your smartphone.

Professional Services

This category can include legal fees, consultancy fees, accountant fees, and fees for any other professional services you use to help launch your business. While some businesses require minimal professional services, most businesses should at least consult a lawyer and/or professional accountant during the startup phase.

Other Costs

You’ll more than likely find out that there are more startup costs than you initially anticipated. Thus, it’s important to have a certain amount of your budget set aside for miscellaneous expenses that will inevitably come up. Some various costs you’ll need to include in your budget may include:

Organizational dues
Travel costs
Shipping fees
Loan interest
Repairs/renovations
Credit card processing fees (once you start making sales)

Of course, you’ll also need to make sure you have enough money to support yourself before your business becomes profitable, so make sure this cost is included as well.

How To Calculate Startup Costs

The SBA has a very useful startup cost worksheet that outlines common business startup costs with sample figures that you can personalize to calculate the true cost of starting your business. Simply enter the estimated cost for each category (rent, utilities, inventory, employees, etc.) and you’ll be able to get a rough estimate of how much money you might need for your initial investment.

It’s also a good idea to make a sales forecast, in which you estimate how much you will sell in the first 6â12 months of opening your business. How long will it take for your business to make a profit? How long ’til you can pay off your startup expenses? With your prospective revenue in mind, you’ll have a better idea of how much you can afford to spend on ongoing expenses such as payroll and inventory.

If the total seems unaffordably high, look for areas you might be able to cut costs. For example, could you operate your business out of your home for the first six months? Could you subcontract workers instead of hiring employees? Could you use dropshipping to deliver goods to customers directly from the manufacturer, instead of buying inventory upfront?

Once you have a good idea of how much startup capital you might need for your first 6â12 months in business, you can decide how you will finance your venture.

What To Do If You Donât Have The Money

Startup funding can be difficult to procure from a traditional bank, especially if you don’t have any significant assets or previous experience owning a business. However, that doesn’t mean you don’t have any options. Online technology has actually made it a lot easier to find small business funding. Here are some options you might try to finance your business.

Online Loan: This category includes both online business loans and online personal loans. Generally, online business loans for startups are limited to short-term, high-interest loans; you won’t qualify for better terms unless you’ve been in business at least two years. Still, it’s definitely worth looking into to see what kind of loans and rates you might qualify for. Some online lenders might even offer access to SBA loans for entrepreneurs, such as SBA microloans. Look at our startup business loan comparison chart to find some startup-friendly loan options.
Business Credit Cards: If you just need a few thousand dollars to get started, a business credit card can be a smart choice. You can use a business credit card to charge startup expenses, and/or to get a cash advance (though make sure you check the terms on the advance because they usually charge high interest). You could also use a personal credit card, though business credit cards typically have more business-specific benefits, such as cash-back for common business expenses. Look at our best small business credit cards comparison to see some of the top business cards’ requirements and perks.
Equipment Financing: If your main startup expense is the equipment you’ll need to run your business — for example, restaurant kitchen equipment, manufacturing equipment, office equipment, etc. — then you can simply finance the equipment itself, in the form of an equipment loan or lease. Similar to automotive financing, equipment financing involves monthly payments (either to lease or own), and does not typically require good credit or any collateral other than the equipment itself. Check out our equipment financing comparison chart to see your best options.
Line Of Credit: A business line of credit is similar to a credit card in the sense that you can have it on hand to pay for expenses, but you only have to repay what you use. Like a business loan, you can get a line of credit from an online lender or a traditional bank. However, startups will have better luck finding a line of credit online; there are several online line of credit providers that only require only 6 or fewer months in business, whereas banks typically will not extend a line of credit to startups. Check out our line of credit comparison page to find some startup-friendly LOC options.

Other startup financing ideas:

Loan from friends/family
Crowdfunding
Seed investors
Business grant
Nonprofit lenders
Personal retirement savings— rollover a retirement account using a ROBS (rollovers as business startups) plan

Our team at Merchant Maverick has also written many informative articles about startup financing that can help you on your journey:

Crowdfunding For Startups: 8 Tips For Launching
Don’t Let Bad Credit Stop You From Getting A Startup Loan
The Best Business Cards For Startups And Entrepreneurs
SBA Loans For Startups
How To Find A Startup Grant
14 Types Of Alternative Financing For Small Businesses
The Best Business Credit Cards For People With Bad Credit

Tax-Deductible Startup Costs

If your total startup costs are $50K or less, you can write off up to $10,000 of startup costs on your taxes in the year that you start the business, including up to $5,000 in business startup costs and another $5,000 in organizational expenses (legal fees, state incorporation fees, etc.). If your startup costs exceed $50,000, the amount of your allowable deduction will be reduced by that dollar amount, and if your startup costs are more than $55,000, you are not eligible for the deduction.

Certain startup expenses are not tax-deductible—for example, the costs to qualify for doing business in your industry, such as real estate licensing costs, are not deductible as a startup expense. Additionally,Â business assets (one-time business expenditures such as vehicles and equipment) are not deductible as startup expenses, but may be deductible in a different category (amortization).

(In case you were wondering, business loan interest is, indeed, tax-deductible.)

Final Thoughts

It may be a cliche, but it is also true that “it takes money to make money.” Startup business costs can range from under $10K to over $100K, depending on a number of factors. It’s okay if you don’t have all the money right now: the important thing is to put together an accurate estimate of how much you will need, what you will spend the money on, and how/when you’ll be able to repay any borrowed monies with your revenue. You can then incorporate this estimate into your business plan and the loan proposal you will use to demonstrate to lenders that you are a good candidate for financing.

With the numerous financing options available to entrepreneurs these days, there is a great chance that if you have a sound business plan and accurate, reasonable startup cost estimate, you will be able to find a lender that can meet your startup financing needs.

The post How Much Money Do You Need To Start A Business? appeared first on Merchant Maverick.

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July 15, 2019

Maryland Small Business Loans

One of the wealthiest states in the nation, Maryland is considered one of the best U.S. states to live and work in. Being one of the 13 original colonies, Maryland is also among the nation’s oldest states; however, that doesn’t mean it rejects the new. Its largest city, Baltimore, was named by Forbes as one of the “Top 10 Rising Cities for Startups” in 2018, and Governor Larry Hogan recently described Maryland as being among “the top states in the country for entrepreneurial business growth,” touting the success of his administration’s “Open For Business” initiative.

Maryland’s proximity to Washington D.C. is an advantage for small businesses that are eligible for federal contracts, and its GDP is well above the national average. Maryland ranks second per capita and fourth overall in Small Business Innovation Research Program (SBIR) awards. Maryland also has a growing and highly educated workforce, meaning there is a great selection of talent available for hire.

While Maryland presents a lot of opportunity for businesses, it is not without its downsides. Maryland can be a costly place to run a business, when you take into account the state’s high rent, high business taxes, and high labor costs. If you’re not one of Maryland’s independently wealthy (though MD does have a disproportionately high number of such residents), it can be a struggle to obtain enough startup capital to open a new business in Maryland, or to keep your existing small business afloat in the face of high operating costs.

For Maryland entrepreneurs who need a business loan, I’ve put together this resource with the best loans for Maryland small business owners. These include the best online loans, bank loans, grants, and other small business resources. I highly encourage you to read on if you are a Maryland entrepreneur in need of business financing.

Online Business Lenders For Maryland Businesses

Online business loans are the quickest and easiest way Maryland business owners can obtain business financing. Though these loans typically have higher borrowing fees and shorter repayment terms compared to a traditional bank loan, their convenience makes them worth it for some business owners—particularly for business owners who need capital ASAP or who can’t qualify for a loan from a bank or credit union. If you have a newer business or less-than-excellent credit, an online loan is likely your best financing option.

Read this section to learn about some of our favorite online lenders that extend loans to businesses in Maryland.

Lendio

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Time in business: 6 months Business revenue: $10,000 per month Personal credit score: 550 Borrower requirements (click to expand) Hide

Best For…

Exploring various online loan options

Lendio is an online loan aggregator, aka a loan marketplace, where businesses in all 50 states can search for and apply to multiple online loans with a single application. Lendio does not originate loans, but rather, they will connect you to their lending partners that meet your needs.Â It’s a good place to start if you’re not sure how much financing you might qualify for or which type of financing (bank term loan, short-term loan, line of credit, merchant cash advance, etc.) would best suit your business needs.

Lendio’s borrower qualifications vary since they work with a wide range of lenders, but Lendio recommends applicants meet the following minimum borrower requirements:

Time in business: 6 months
Credit score: 550
Business revenue: $10K/month

We like Lendio for the excellent lenders they work with and the broad range of business financing products they provide access to, from short-term loans to long-term SBA loans, and many others in between. Lendio can connect qualified borrowers with loans as large as $5 million and, the average time to funding is 2â7 days.

Breakout Capital

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Must be in business at least 12 months with a revenue of $10,000 per month. Must have a personal credit score of 600 or above. Borrower requirements (click to expand) Hide

Best For…

Businesses with fair credit and/or unpaid invoices

Breakout Capital, also available to businesses in all 50 states (and D.C.), is a short-term lender that distinguishes itself by being transparent and reputable in a sea largely made up of unscrupulous, predatory lenders. Their terms and rates are clearly disclosed and they have excellent customer service in case you have any questions.

Breakout’s financing products include short-term business loans up to $250,000, and FactorAdvantage invoice factoring loans up to $500,000. FactorAdvantage loans are a combination of invoice factoring and Breakout Capitalâs business loans. Breakout loans are flexible in that they act similar to a line of credit, making it easy to borrow more capital after you repay your first loan.

To qualify for a short-term business loan with Breakout Capital, you need:

Time in business: 1 year
Credit score: 600
Business revenue: $10,000/month

Regarding FactorAdvantage, because this loan is designed to be used in conjunction with invoice factoring services, Breakout Capital does not require any specific time in business, revenue, or credit score. Funds are typically received within one business day after the final closing contracts for the loan are signed.

AMEX Business Loans

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Time in business: 24 months Business revenue: $50,000 per year Personal credit score: Good to excellent Other: Must accept Amex cards or have an Amex business credit card (depends on the type of financing you are applying for) Borrower requirements (click to expand) Hide

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Best for…Â

Established businesses that use or accept American Express

American Express Business Loans are available to businesses in all 50 states. They are not pricey credit card advance loans, but rather, they are actual term loans, including both short-term and medium-term loans. You do, however, need to either have a business AMEX card or accept AMEX cards at your business in order to qualify.

AMEX loans are convenient, fast, and reasonable in terms of their terms and fees. Depending on which loan you apply for, you can qualify for financing up to $50K (medium-term “Business Loans” product), $750K (short-term “Working Capital” loan), or $2 million (short-term “Merchant Financing” loan, similar to cash advance). The time to funding is typically about 2 days.

To qualify for AMEX business financing, you’ll need the following requirements:

Time in business: 2 years
Credit score: N/A
Business revenue: $50K/year

Youâll also need to be an American Express business credit card holder for Working Capital and Business Loans. For Merchant Financing, youâll need to accept American Express cards. Depending on the product, you may also need to do at least $12,000 in card-based sales annually.

OnDeck

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Time in business: 12 months Business revenue: $100,000 per year Business industry: Must not be in aÂ restricted industry Personal credit score: 600 Borrower requirements (click to expand) Hide

Best For…

Semi-established businesses with fair credit

OnDeck is the largest and probably the most well-known online small business lender, offering short-term loans and revolving lines of credit to eligible businesses in all 50 states. OnDeck is a hugely prolific, publicly traded company that has relatively few negative complaints considering their enormous footprint. Like the other online lenders on this list, OnDeck has the advantages of being fast, convenient, and willing to lend to businesses that cannot qualify for a bank loan. OnDeck offers short-term loans up to $500K and lines of credit up to $100K.

Here’s what you need to qualify for an STL or LOC from OnDeck:

Time in business: 1 year
Credit score: 600
Business revenue: $100K/year

Average time-to-funding with OnDeck isÂ 1-2 days.

LoanBuilder

	Review Check Eligibility

Time in business: 9 months Business revenue: $42,000 per year Personal credit score: 550 Borrower requirements (click to expand) Hide

Best For…

Newer businesses with bad credit

LoanBuilder is actually part of PayPal’s business loan arm, but unlike PayPal Working Capital loans, you do not need to be a PayPal business in order to qualify for a LoanBuilder loan. In fact, you need very little in terms of qualifications to qualify for a LoanBuilder loan—businesses with less than a year in business and sub-600 credit scores can qualify.

LoanBuilder offers short-term loans up to $500K, with no origination fee.

An interesting benefit of LoanBuilder is that you can tinker with your loan amount and repayment term to “build” your own perfect loan before accepting the loan offer.

Here’s what you need to qualify for a LoanBuilder loan:

Time in business: 9 months
Credit score: 550
Business revenue: $42K/year

Funding can be as fast as the next business day after you turn in all your documents and sign the contract. As with the other lenders on our list, LoanBuilder serves all 50 states.

Prosper

	Review Compare

Time in business: N/A Business revenue: N/A Personal credit score: 600 – 680 Personal income: $20,000 LendingPoint does not operate inÂ Colorado, Connecticut, Iowa, Louisiana, Maine, Maryland, Massachusetts, Nevada, New York, North Dakota, Rhode Island, South Carolina, Vermont, West Virginia, Wisconsin, and Wyoming Borrower requirements (click to expand) Hide

Best For…

Small startup loans

Prosper is a personal loan option available to borrowers in Maryland (and all other US states, except Iowa and West Virginia). Because these are personal loans, you can use them for almost any purpose you like, including to fund a business. You also don’t need any business qualifications in order to qualify for a Prosper loan, making this option suitable for startups, even if your business is only in the idea stage. You will, however, need to have at least fair personal credit.

Prosper sells term loans from $2Kâ$40K with monthly repayments. Though you can’t get a large loan through Prosper, the monthly repayments are a refreshing attribute, as most other online loans require daily or weekly repayments.

To qualify for a Prosper loan you’ll need:

Time in business: N/A
Credit score: 640
Business revenue: N/A

Usually, the time it takes from application to funding is a week or less. However, because Prosper has a peer-to-peer model wherein investors choose which loans they want to fund, it can take up to 14 days for investors to decide if they will fund your loan.

SmartBiz

	Review Visit Site

Must be in business at least 2 years. Must have a personal credit score of 650 or above. Must have a business credit score of 150 or above. Borrower requirements (click to expand) Hide

Best for…

Long-term, low-interest SBA loans online

SmartBiz, available in all 50 states, combines the best of both worlds when it comes to business loans: the convenience of an online application, and the low-cost and comfortable repayment schedule of a long-term loan. Specifically, SmartBiz offers SBA loans up to $5 million, including general business loans and commercial real estate loans. SmartBiz also partners with banks to sell non-SBA bank term loans up to $200K.

SmartBiz’s main benefit is its efficient, simplified SBA (Small Business Administration) loan application process. If you can qualify for a bank or SBA loan, SmartBiz offers a quicker application as well as a speedier time-to-funding. Also, while SmartBiz isn’t as easy to qualify for as some online loans, you may still qualify even if you have fair personal credit, and there is no specific revenue requirement.

Borrower qualifications vary somewhat depending on which type of loan you apply for:

Time in business: 2â3 years
Personal credit score: 650â675
Business credit score (on certain loans): 150
Business revenue: N/A (but sufficient to support repayments)

Time-to-funding can take from one to several weeks, depending on how fast you submit all the necessary documents. Still, this is faster than applying for a bank/SBA loan through traditional channels.

Banks & Credit Unions In Maryland

Whereas online loans are ideal for Maryland businesses that have subprime credit or not much time in business, bank loans are more appropriate for established businesses with excellent credentials. If you apply for financing through a bank or credit union, you might qualify for a longer-term loan with low interest, especially if your bank is an SBA (Small Business Administration) loan partner. As mentioned, some reputable online lending companies such as Lendio and SmartBiz have the option of connecting you with bank loans, including SBA loans—a type of government-backed business loan offered by certain banks.

The following are some popular Maryland business bank loan options. We don’t have too much information about local Maryland banks, as we don’t typically review local banks in depth. Nevertheless, choosing a local bank versus a large national bank can have its advantages in terms of more responsive and personalized customer service, so it’s definitely worth checking out these options on your own.

Howard Bank

Howard Bank, Baltimore’s largest independent bank, is an SBA-preferred lender and also offers non-SBA business loans. Howard Bank offers business loans for a variety of business purposes, such as working capital and equipment financing, as well as commercial real estate loans.

Howard is a strong option to consider if you want to choose a local Maryland bank for your business financing needs. Howard Bank also participates in Baltimore County’s Small Business Loan Fund, discussed in more detail below.

In addition to Baltimore County, Howard Bank also has numerous other branch locations throughout central Maryland.

T.D. Bank

T.D. Bank, N.A. is the American branch of Canadian bank Toronto-Dominion Bank. This New Jersey-based bank division operates in 15 states, including Maryland, as well as Washington D.C.

Maryland small businesses with good credit may find T.D. Bank to be an excellent smaller alternative to the “Big 4” banks, as they offer low interest rates to qualified borrowers. T.D. bank also participates in Baltimore County’s Business Small Loan Fund, discussed in more detail below.

Chase Bank

In 2018, J.P Morgan & Chase unveiled plans to open more than 70 locations in Maryland, D.C., and Virginia. Chase already has locations in the Capitol but will open its first Baltimore-area branch in 2019 (in Hunt Valley).

For businesses looking for the convenience of a large, national bank, Chase offers excellent business financing solutions to small and large businesses (including startups), with low interest rates. However, you will need good credit to qualify for Chase’s financing products, which include business term loans, SBA loans, and lines of credit. Chase also offers its customers some excellent business credit cards.

See our Chase Business Loans review for more information on Chase’s business loan requirements.

Baltimore County Small Business Loan Fund

Baltimore’s Small Business Loan Fund is a partnership between the County of Baltimore and some of the area’s leading banks, including T.D. Bank, Howard Bank, Wells Fargo, Bank of America, PNC Bank, and others. These are real estate and fixed-asset loans with a maximum amount of $1 million, or 40 percent of the project cost, whichever is lower. To qualify, applicants must obtain a loan commitment for at least half of the project cost from a participating Baltimore bank. You can find a full list of participating banks on Baltimore County’s website.

Nonprofit Lenders In Maryland

Nonprofit lenders may be able to offer low-interest loans to qualified small businesses. While not all Maryland businesses will be eligible, the good news is that Maryland has at least several nonprofit organizations that offer low-interest small business loans to businesses that don’t qualify for bank financing. There are also government-funded loans specifically for nonprofit organizations in the state of Maryland.

Baltimore Community Lending, Inc.

Baltimore Community Lending, Inc. is a certified nonprofit Community Development Financial Institution. This enterprise’s wholly owned subsidiary Baltimore Business Lending, LLC provides capital to startup and emerging small businesses in the city of Baltimore that have good credit but lack the equity or collateral to obtain traditional financing. Loans are made via partnerships with approved microlenders and technical assistance providers.

Nonprofit, Interest-Free, Micro Bridge Loan Account (NIMBL)

NIMBL is a loan from the state of Maryland available to nonprofit organizations only. Specifically, this program is for nonprofits that have been approved for other government grants or contracts but have not received the funds yet (hence the “bridge” loan designation). This program provides interest-free loan up to $25K to qualified nonprofits in the state of Maryland. You can find more information about this program on the Maryland Department of Commerce website.

Rockville Economic Development, Inc.

Rockville Economic Development, Inc. (REDI) was founded in 1997 as a nonprofit entity to support existing small businesses as well as to attract new businesses to the city of Rockville, MD. REDI offers several different loans and grants to Rockville businesses; Rockville businesses should check REDI’s website to see which financing programs they might be eligible for.

In addition to these nonprofit loans for businesses in the city of Rockville, other cities and counties in Maryland, including Frederick, Montgomery, and Baltimore, have similar low-interest or interest-free loan programs for businesses in those areas.

Small Business Grants In Maryland

Generally, grants for for-profit businesses are hard to come by and even harder to get approved for. However, Maryland seems to have an exceptional number of government-funded grant programs designed to promote economic development in the state. I’ve highlighted some of the most relevant programs below, and you can find a full list of all state business grant programs on Maryland’s Department of Commerce website.

Video Lottery Terminal Fund

Maryland’s Video Lottery Terminal Fund (VLT) uses proceeds from the state’s video slot machines to assist small, minority, and women-owned businesses located throughout the state of Maryland (and especially in the areas surrounding Maryland casinos). You can find more information on this grant on Maryland’s Department of Commerce website.

Rockville Small Business Impact Fund

The Rockville Small Business Impact Fund is a new program that will offer financial assistance to qualified, small- and medium-sized businesses in Rockvilleâs performance districts, particularly start-ups and businesses lacking access to the capital they need to sustain growth.

Per the program’s website:

During the Impact Fundâs pilot year, it will support private-sector solutions to community challenges through a grant focused on fostering economic vitality and community engagement in Rockville Town Center.

Montgomery County MOVE Program

MOVE is a one-time grant for businesses that are new to Montgomery County and lease up to 10,000 square feet of office space for a minimum of three years, excluding retail and restaurant industries. (Rockville, MD has a comparable program.) Eligible businesses may receive a grant of $8.00 per square foot for Class A or B space, and up to $4.00 per square foot for Class C space. You can contact the Montgomery County Economic Development Corporation for more information on this grant.

Advantage Maryland

Advantage Maryland (also known as MEDAAF) is a broad, state-funded program that funds grants, loans, and investments to support economic development initiatives in the state of Maryland. Only businesses in eligible industries and priority funding areas will qualify. Contact the Maryland Department of Commerce for more information.

Export MD Program

The Export MD grant is designed to reimburse Maryland businesses for international marketing expenses. Funded in part through a cooperative agreement with the SBA, Export MD awards eligible Maryland businesses with up to $5,000 in reimbursement for expenses associated with an international marketing project—for example, trade show fees, airfare, translation of brochures, and website development. Maryland DOC accepts applications for this grant on a monthly basis.

Loans & Resources For Startups In Maryland

Brand-new companies have special hurdles when it comes to obtaining startup capital and other startup necessities. Fortunately, there are both state-funded and private nonprofit organizations in Maryland to help you find startup capital, register your business, and get your business off the ground!

Maryland Business Express

Hosted on the Maryland Department of Commerce website, Maryland Business Express is an online resource that provides a comprehensive set of resources for individuals who want to start a business in Maryland. You can do everything from register your business, to establish tax accounts for your business, to obtain Maryland business licenses online.

In other areas of the same website (Maryland DOC), you can also find loan and financing resources for Maryland business startups.

Maryland Capital Enterprises, Inc.

Maryland Capital Enterprises, Inc. (MCE) is a nonprofit lender providing small business loans to startups in Maryland. These loans of up to $50K are for for-profit startup businesses that have tried to obtain capital from a bank but were unable to. Visit the program’s website for more info.

Frederick County Small Business Loan Guarantee

The Frederick County Small Business Loan Guarantee program provides funds for the purchase of real estate, machinery, equipment, inventory, working capital, and renovation of real estate to startup businesses located in a Frederick County priority funding area (priority funding areas cover most municipalities and major transportation corridors in the county). The loan guarantee is for up to 80% of the loan with a maximum of $50,000.

Baltimore County Boost Fund

The Baltimore County Boost Fund provides loans of up to $250K to small businesses (classified by SBA standards) in Baltimore County and can be used for startup funds, as well as other business expenses. Baltimore-area small businesses are eligible, as are minority-owned businesses, woman-owned businesses, and veteran-owned businesses in Baltimore. Baltimore County also has a few other loan programs startups in the area may qualify for.

What To Consider When Choosing A Lender

There’s a lot to consider when choosing a small business lender. Among the most important factors are :

How much you’ll pay for the loan (in interest and other fees)
Time-to-funding
Repayment schedule
Lender reputation
Ease of application
Do you qualify?

Generally, you want to choose the lowest-interest loan you qualify for, but you’ll also want to consider the lender’s overall reputation and whether you can comfortably afford the loan repayments. If you are time-pressed (and who isn’t?) you should also take into account how fast the loan will come through, and how convenient the application process is.

Different types of loans have different pros and cons you’ll need to weigh—for instance, an online loan you qualify for today might be easy to apply for and will hit your account within a couple of days, but carry a high interest rate or factor rate, with a short repayment term. You may have to wait a couple of years before you can qualify for a bank or SBA loan, but it will have a lower interest rate and more comfortable repayment schedule.

In order to choose the best loan you qualify for, you’ll need to consider multiple offers from different lenders. As mentioned, using a loan aggregator service like Lendio one good way to compare different business loans at the same time.

Of course, you’ll also want to make sure you even qualify for a loan before you start seriously considering them, or you’ll just be wasting your time. Be sure to check your credit score and also check that you meet a lender’s borrower requirements—which are almost always clearly stated on their website—before applying.

Final Thoughts

It’s safe to say that Maryland is indeed “open for business,” as its business-forward mayor states. While Maryland does have a relatively high cost of doing business compared to many other states, there are numerous loans and even grants available to Maryland businesses.

The D.C.-adjacent state has a lot going for it when it comes to attracting small businesses, including a wealthy populace, potential for government contracts, access to a major seaport, and many government programs to promote economic development, particularly for businesses owners who struggle to qualify for traditional means of capital. Whether you choose to go the bank loan route, apply with an online lender, or try to qualify for government-backed financing, you have many financing options at your disposal as a business owner (or aspiring business owner) in the Old Line State.

The post Maryland Small Business Loans appeared first on Merchant Maverick.

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July 11, 2019

Top Credit Cards With Airport Lounge Access

Airports are not places of emotional respite and quiet contemplation. Airports are angry, crowded, chaotic, exploitative places where anxiety thrives like bacteria on picnic potato salad. Heavily-policed cathedrals of dread and frustration where the malware-ridden charging stations are all occupied and a mediocre sandwich costs 12 bucks. The modern airport experience distills and concentrates the existential toxicity we spend our lives trying and failing to avoid.

Wouldn’t it be nice if there were something you could do to make airports less awful? As it turns out, for a price, there is.

Most airports have lounges where you can take refuge from the rest of the airport. While airports differ in terms of the lounge benefits they offer, these benefits typically include complimentary snacks and drinks, free wi-fi, computer workstations, comfy seating, and other luxury amenities. Some even offer full spa treatments!

You can just pay to get into these lounges, but if you use them with any frequency, this will cost you quite a bit. Thankfully, some travel credit cards come with complimentary airport lounge access, entitling you — and up to two companions, in most cases — to use these lounges and enjoy their benefits. While these cards normally carry a high annual fee, you’ll still come out ahead if you use these lounges often enough. Plus, premium travel cards offer a host of additional benefits, like travel protection, the ability to earn points or cash back, and more.

Read on to get the details of the top travel credit cards with lounge access. Hopefully, you’ll find one that appeals to you!

Credit Card	Annual Fee	Lounge Access
The Platinum Card from Amex	$550	Amex Centurion, Priority Pass, Delta Sky Clubs, Airspace
The Business Platinum Card from Amex	$595	Amex Centurion, Priority Pass, Delta Sky Clubs, Airspace
Mastercard Black Card	$495	Priority Pass
Chase Sapphire Reserve	$450	Priority Pass
Citi / AAdvantage Executive World Elite Mastercard	$450	American Airlines Admiral’s Club
Hilton Honors Amex Aspire	$450	Priority Pass
Hilton Honors Amex Ascend	$95	Priority Pass

The Platinum Card from American Express

The Platinum Card from American Express Compare	Annual Fee: $550 Purchase APR: N/A (charge card)
Required credit: Good, excellent Bonus offer: 60,000 points after you spend $5,000+ on purchases in your first 3 months Purchase intro APR: N/A (this is a charge card) Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 5 points per dollar spent on flights booked directly with airlines or with American Express Travel 5 points per dollar spent on prepaid hotels booked on amextravel.comâ¨ 1 point per dollar spent on all other eligible purchases Notable perks & benefits: Get access to over 1,200 airport lounges worldwide via theÂ American Express Global Lounge Collection Receive a statement credit every 4 years after you apply for Global Entry ($100) or TSA PreCheck ($85) Use Membership Rewards Pay with Points for a First or Business class flight with any airline available through Amex Travel and get 35% of the points back Get $200 per year in statement credits for incidental fees with the qualifying airline of your choice More card details (click to expand) Hide

The Platinum Card from Amex earns first mention from us in this article. Why? Because no other credit card out there (with the exception of the business version of this card) gets you access to as many airport lounges as this one.

With Amex’s Platinum Card, you’ll gain access to the American Express Global Lounge Collection, which includes the following airport lounge networks:

Amex Centurion — Typically rated as the most luxurious of the bunch, Amex Centurion lounges can be found at 8 domestic airports and 8 non-US airports
Priority Pass — Priority Pass is the world’s biggest airport lounge network with over 1,200 locations across 130 countries
Delta Sky Clubs — You must be flying with Delta to take advantage of these lounges
Airspace — Airspace lounges can currently be found in just two airports, Cleveland and San Diego

The Platinum Card gives youÂ and up to two companions free access to these lounges. Not too shabby!

The airport lounge benefits are only the beginning of the perks you’ll be able to access. You’ll earn 60,000 Membership Rewards points after you spend $5,000+ on purchases within 3 months. You’ll get an annual $200 airline fee credit to cover incidentals with an airline of your choosing. You’ll get up to $200/year worth of Uber credits.

Shall I go on?

You’ll get 5X Membership Rewards points on a) flights booked directly with airlines or with American Express Travel,Â and b) prepaid hotels booked on amextravel.com. You’ll get a statement credit to cover the cost of applying for Global Entry or TSA PreCheck. You can use your points to book travel with amextravel.com and not have to deal with blackout dates or seat restrictions. You’ll even get complimentary benefits with an average total value of $550 with Fine Hotels & Resorts.

As you can see, the Amex Platinum Card carries a great many high-value benefits (and I didn’t even list them all!). However, these benefits don’t come cheap, as the card carries a $550 annual fee. Now, keep in mind that every other card featuring this level of free airport lounge access also carries a hefty annual fee (over $400). Of course, in order to come out ahead financially with any of these cards, you’ll have to fly often enough to take full advantage of your travel benefits.

Keep in mind that this is a charge card — you have to pay your balance in full each month.

The Business Platinum Card from American Express

American Express Business Platinum Card Compare	Annual Fee: $595 Purchase APR: N/A (this is a charge card)
Required credit: Good, excellent Bonus offer: 50,000 points after you spend $10,000 and an extra 25,000 points after you spend an additional $10,000 on all qualifying purchases within the first three months Purchase intro APR: N/A (this is a charge card) Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 5 points per dollar spent on flights and prepaid hotels booked via Amexâs travel website 1.5 points per dollar on eligible purchases of $5,000 or more â up to 1 million additional points per year 1 point per dollar on all other eligible purchases Notable perks & benefits: Get access to over 1,200 airport lounges worldwide via theÂ American Express Global Lounge Collection Receive a statement credit every 4 years after you apply for Global Entry ($100) or TSA PreCheck ($85) Use Membership Rewards Pay with Points for a First or Business class flight with any airline available through Amex Travel and get 35% of the points back Get $200 per year in statement credits for incidental fees with the qualifying airline of your choice More card details (click to expand) Hide

American Express Business Platinum Card

amex business platinum review
Compare

Annual Fee:

$595

Purchase APR:

N/A (this is a charge card)

Required credit: Good, excellent

Bonus offer: 50,000 points after you spend $10,000 and an extra 25,000 points after you spend an additional $10,000 on all qualifying purchases within the first three months

Purchase intro APR: N/A (this is a charge card)

Balance transfer intro APR: N/A

Foreign transaction fee: None

Rewards:

5 points per dollar spent on flights and prepaid hotels booked via Amexâs travel website
1.5 points per dollar on eligible purchases of $5,000 or more â up to 1 million additional points per year
1 point per dollar on all other eligible purchases

Notable perks & benefits:

Get access to over 1,200 airport lounges worldwide via theÂ American Express Global Lounge Collection
Receive a statement credit every 4 years after you apply for Global Entry ($100) or TSA PreCheck ($85)
Use Membership Rewards Pay with Points for a First or Business class flight with any airline available through Amex Travel and get 35% of the points back
Get $200 per year in statement credits for incidental fees with the qualifying airline of your choice

More card details (click to expand)

Hide

You guessed it: The Business Platinum Card from American Express is the business version of Amex’s Platinum Card. Naturally, the two cards are similar, but not identical.

The similarities? Both cards offer the same level of airport lounge access and largely carry the same travel perks, such as a fee credit for Global Entry/TSA PreCheck and a $200 airline fee credit. Also, both are charge cards.

The differences? The Business Platinum card has a slightly higher annual fee ($595) and no Uber credits. It also sports a higher signup bonus, though you have to spend more in order to get it in full. The Amex Business Platinum offers 50,000 points after you spend $10,000 in your first three months and another 25,000 points after you spend an additional $10,000 within those same three months.

The card’s points-earning structure is also a bit different: 5X points on airfare and prepaid hotels booked on amextravel.com and 1.5X points on purchases of $5,000 or more. All other purchases earn you 1 point per dollar spent.

As the Amex Business Platinum is a business credit card, you can get cards for your employees for no additional fee.

Mastercard Black Card

Mastercard Black Card Apply Now	Annual Fee: $495 Purchase APR: 17.24%, Variable
Required credit: Excellent Bonus offer: None Purchase intro APR:Â N/A Balance transfer intro APR: 0% for the first 15 billing cycles Foreign transaction fee: None Rewards: 1 point per dollar spent 2% value for airfare redemptions 1.5% value for cash back redemptions 1% value forÂ hotel stays and car rental redemptions Notable Perks & Benefits:Â 24/7 Luxury Card Concierge Luxury gifts fromÂ brand name companies Room upgrades, complimentary food and beverage, and spa credits when booking with Luxury Card Travel Travel benefits, including global luggage delivery,Â 24/7 chauffeured transportation, and private jet/yacht chartering services $100 annual airline credit Priority Pass Select VIP airport lounge access Global Entry & TSA PreCheck application credit More card details (click to expand) Hide

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The Mastercard Black Card doesn’t carry the same level of travel benefits as most of the other cards here, so it’s fair to ask how one can justify getting this card, given its $495 annual fee. Well, there’s one thing the Mastercard Black Card can offer that other travel cards with airport lounge access don’t.

The Mastercard Black Card gives you access to Priority Pass lounges via the Priority Pass Select program, but unlike other credit cards offering this benefit, the Mastercard Black Card bestows free access to Priority Pass lounges for both you and an unlimited number of guests. The other credit cards offering Priority Pass Select limit free lounge access to two companions with any additional companions subject to a fee for entry. If Priority Pass Select membership is of the utmost importance to you and you travel frequently with a sizable family or entourage, the Mastercard Black Card might be just what you’re looking for.

While the Black Card’s other benefits don’t quite live up to those of the other cards listed here, the card does offer 2% of your value back (in the form of points) for airfare redemptions and 1.5% value for cash back redemptions. You’ll also get a $100 annual air travel credit toward all flight-related purchases as well as a fee credit for Global Entry or TSA PreCheck.

Additionally, the card is made out of stainless steel, so it looks cool.

Chase Sapphire Reserve

Chase Sapphire Reserve Compare	Annual Fee: $450 Purchase APR: 19.24%â26.24%, Variable
Required credit: Good, excellent Bonus offer: 50,000 points after you spend $4,000 on purchases in the first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 3 points per dollar spent on travel and dining at restaurants 3 points per dollar spent on travel worldwide immediately after earning your $300 annual travel credit 1 point per dollar spent on all other purchases Notable Perks & Benefits:Â $300 Annual Travel Credit 50% more value when redeeming points for travel via Chase Ultimate Rewards Travel and baggage delay insurance Auto rental collision damage waiver Trip delay reimbursement Purchase protection and extended warranty More card details (click to expand) Hide

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Chase’s Sapphire Reserve card is a solid contender in the travel credit card race, offering free access to all Priority Pass lounges for you and up to 2 guests. The annual fee is $450, but in exchange, you’ll be entitled to some great high-value benefits.

The Sapphire Reserve has an impressive signup bonus of 50,000 points after you spend $4,000+ on purchases in the first 3 months. When redeemed for travel through Chase Ultimate Rewards, those points will be worth $750, as your points get a 50% value boost when you redeem them this way. You’ll also get a statement credit of up to $300 to cover your travel purchases each account anniversary year.

As far as ongoing points-earning goes, you’ll earn 3X points on all travel purchases after earning your $300 annual travel credit. You’ll also get 3X points on all restaurant purchases and 1 point for all other purchases. And yes, you’ll get a statement credit for Global Entry or TSA PreCheck.

With the Chase Sapphire Reserve, you can also transfer your points over to other leading travel loyalty programs on a 1:1 basis. Score one for points flexibility!

Citi / AAdvantage Executive World Elite Mastercard

Citi / AAdvantage Executive World Elite Mastercard Compare	Annual Fee: $450 Purchase APR: 17.99% – 25.99%, Variable
Required credit: Excellent Bonus offer: 50,000 American Airlines AAdvantage bonus miles after spending $5,000 in purchases in your first 3 months Purchase intro APR:Â N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 2 miles per dollar spent on eligible American Airlines purchases 1 mile per dollar on all other purchases Notable Perks & Benefits:Â 10,000 AAdvantage Elite Qualifying Miles (EQMs) once you spend $40,000 in purchases within a calendar year 25% savings on in-flight food and beverage purchases on American Airlines flights Up to aÂ $100 credit every 5 years for Global Entry or TSA PreCheck Priority check-in, priority airport screening (where available) and boarding privileges for you and up to 8 companions on the same reservation First bag checked free on domestic American Airlines flights for you and up to 8 companions ComplimentaryÂ Admirals Club membership Dedicated concierge More card details (click to expand) Hide

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Here’s a luxury travel card with lounge access for frequent American Airlines travelers. The Citi / AAdvantage Executive World Elite Mastercard’s main benefit is the access it grants you to AA’s Admiral’s Club program. Both you and your immediate family (or two unrelated companions) will get free access to the 50+ Admiral’s Club lounges around the world along with 60+ partner lounges.

While the card does carry an annual fee of $450, consider that a standalone Admiral’s Club membership costs up to $650/year for an individual membership and $1,250/year for a household membership!

The Citi / AAdvantage Executive World Elite Mastercard comes with a host of additional travel benefits. You and up to 8 travel companions will get one free checked bag on domestic AA flights, and if your companions are on your reservation, you’ll all enjoy priority check-in, priority airport screening (where available), and priority boarding.

You’ll also get 25% savings on inflight food and beverage purchases on AA flights, a statement credit to cover your Global Entry or TSA PreCheck application fee, 50,000 AAdvantage miles when you spend $5,000+ in the first 3 months, 2 miles for every dollar spent on AA purchases (1 mile per dollar spent on everything else), dedicated concierge service, and more.

Hilton Honors American Express Aspire

Hilton Honors American Express Aspire Card Compare	Annual Fee: $450 Purchase APR: 17.99% – 26.99%, Variable
Required credit: Excellent Bonus offer: 150,000 Hilton Honors points after you spend $4,000+ in purchases within your first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 14 Hilton Honors points per dollar spent on all Hilton-related purchases 7 points per dollar spent on flights booked directly with airlines or amextravel.com, car rentals booked directly from select car rental companies, and US restaurants 3 points per dollar spent on all other purchases Notable Perks & Benefits:Â Unlimited Priority Pass lounge access for you and up to 2 companions per visit Annual $250 Hilton Resort statement credit Annual $250 airline fee credit with a qualifying airline of your choosing Complimentary Diamond status in Hilton’s loyalty program More card details (click to expand) Hide

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Hilton-heads out there will appreciate the Hilton Honors American Express Aspire card. Yes, you’ll get Priority Pass Select membership granting you and up to 2 companions free access to Priority Pass lounges. You’ll also get a nice set of Hilton-specific benefits, including:

Hilton Honors Diamond status
Two weekend award nights — one when you open your account (and on your account anniversary) and one when you spend $60,000 in a calendar year
$250 Hilton Resort statement credit — you get one each calendar year
$250 airline fee credit for incidentals with an airline of your choosing

As far as points go, you’ll get 150,000 Hilton Honors points when you spend $4,000+ on purchases in the first 3 months. The Aspire card also offers a whopping 14X points on all Hilton-related purchases along with 7X points on flights booked directly with airlines or amextravel.com, car rentals booked directly from select car rental companies, and US restaurant purchases. All other purchases will earn you 3X points.

The Hilton Honors Amex Aspire card carries a $450 annual fee.

Hilton Honors American Express Ascend

Hilton Honors American Express Ascend Card Compare	Annual Fee: $95 Purchase APR: 17.99% – 26.99%, Variable
Required credit: Good, Excellent Bonus offer: 125,000 Hilton Honors points after you spend $2,000+ on purchases in the first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 12 Hilton Honors points per dollar spent on all Hilton-related purchases 6 points per dollar spent on all purchases at US restaurants, supermarkets, and gas stations 3 points per dollar spent on all other purchases Notable Perks & Benefits:Â 10 free visits per year to Priority Pass lounges, with each subsequent visit costing $27 Your guests can enter Priority Pass lounges for $27 apiece Complimentary Gold status in Hilton’s loyalty program Earn a Weekend Night Reward after you spend $15,000 on purchases in a calendar year More card details (click to expand) Hide

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No, we didn’t screw up and list the same card twice. The Hilton Honors American Express Ascend (not the Aspire) card differs from its sister card — and every other credit card listed in this article — in that it offers airport lounge access while sporting an annual fee of just $95. Relatively speaking, the Ascend card is the “bargain” option if you want a credit card that grants you airport lounge access!

However, along with the smaller annual fee comes a lower level of lounge benefits. You get 10 free visits per year to Priority Pass lounges, with each subsequent visit costing $27. And if you want your guests to get in for free, you’ll have to use up one of your 10 free lounge visits on each person you bring with you.

The card comes with a bonus offer of 125,000 Hilton Honors points after you spend $2,000+ on purchases in your first 3 months. You’ll also earn 12X points on all Hilton purchases, 6X points on US restaurants, supermarkets, and gas stations, and 3X points on everything else. Additional benefits include complimentary Hilton Honors Gold status and a free weekend reward night after you spend $15,000 on purchases in a calendar year.

Final Thoughts

Airports are not fun places. If you’re prepared to pay for the privilege of having a more pleasant airport experience, a travel credit card gives you a better deal on airport lounge access than a standalone membership. If you travel often enough to take advantage of the benefits of these cards, you can easily recoup the value of these cards’ high annual fees.

Still searching for the credit card that fits your needs? Let these articles inform your decision!

Best airline credit cards for businesses
Top credit cards with no foreign transaction fees
Guide to using personal cards for business

The post Top Credit Cards With Airport Lounge Access appeared first on Merchant Maverick.

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July 8, 2019

Credit Card Consolidation: How to Consolidate Credit Card Debt

We are a nation of debtors.

The defining feature of modern American life is the fact that everything necessary for survival — housing, education, health care, you name it — gets more expensive by the day while our wages stagnate or decline. Ergo, we get ourselves into credit card debt in order to keep the late capitalist wolves at bay. You may well be dealing with paying down multiple high-interest credit cards along with keeping all your other bills paid.

If this is the case, there are ways you can make your payments easier to handle by consolidating your credit card debts into a single debt with a lower interest rate. As it happens, there are multiple methods of doing this, each with its own advantages and disadvantages.

Credit Card Consolidation: The Basics

Credit card debt consolidation is easy enough to describe. You borrow money to pay off your existing credit card debt, which results in you having a single debt to pay off rather than several. This single debt will typically have a lower interest rate than your original debts. This way, you’ll save money and make the repayment process more manageable.

Sounds great, right? Well, there are different ways to consolidate your credit card debt, and each method comes with its own upsides and downsides. We’ll get into these methods, but first, let’s discuss just who should be looking into credit card debt consolidation.

Who Should Consolidate Credit Card Debt?

When done right, consolidating your credit card debt should leave you in a better financial position than when you started and should make it easier for you to pay down your debt. But if you’re not in a position to be able to stop making new credit card charges, you won’t be any closer to your goal of paying off your debt. Likewise, a decent credit score is an unfortunate prerequisite for certain debt consolidation methods (like a personal loan).

While anybody buried under credit card debt can take advantage of one debt consolidation method or another, it’s important that the method matches your individual circumstances.

Common Debt Consolidation Pitfalls

Every debt consolidation method carries particular risks. For instance, consider the situation I outlined above. If you take out a personal loan to pay off your credit cards but then continue to rack up charges on your credit cards, you’ll have only added another debt to your debt pile with your personal loan.

Likewise, a homeowner may take out a home equity loan or line of credit and use the money to pay off credit card debts. But if — for whatever reason — you can’t make your HELOC payments, you could lose your home!

While there are a number of ways you can try to hoist yourself out of credit card debt, always be aware of the hazards associated with each method.

5 Ways To Consolidate Credit Card Debt

There are a number of tactics one can employ to tackle credit card debt, five of which I will detail here:

Transfer your debt to a 0% balance transfer credit card
Take out a personal loan
Find a nonprofit credit counseling organization
Take money out of a retirement account
Take out a home equity loan or line of credit

Transfer Your Debt To A 0% Balance Transfer Credit Card

Certain credit cards are sold as debt consolidation tools. These cards will usually offer an introductory interest-free period (often 12-15 months but occasionally longer) on all credit card balances you transfer over to the card within a certain time frame (typically within 30-60 days of getting your card). If you manage to pay off your debt on the card within the interest-free period, you can avoid paying any further interest on your debt.

It’s one of the safer means by which you can consolidate your credit card debt, as you won’t be putting your house on the line or anything. However, these balance transfer credit cards often require good to excellent credit in order to qualify, thus excluding a lot of indebted people. What’s more, while these cards won’t charge interest on your balance transfers for a certain length of time, these cards often have a balance transfer fee of about 3%.

Additionally, the credit limit on your balance transfer credit card may not be high enough to accommodate you transferring all your existing credit card debt to the balance transfer card. If you have an enormous amount of credit card debt, it won’t be easy to find a balance transfer credit card that can accommodate all of it.

Another factor to consider: Some credit card issuers won’t let you transfer a balance to their card from another card of theirs. For instance, Chase won’t let you transfer a balance from one of their cards to another.

A good example of a balance transfer credit card is the Amex EveryDay card.

Amex EveryDay Credit Card Compare	Annual Fee: $0 Purchase APR: 15.24% â 26.24%, Variable
Suggested credit:Â Good, excellent Bonus offer:Â 10,000 Membership Rewards Points after you spend $1,000 in the first 3 months Purchase intro APR:Â 0% for the first 15 months Balance transfer intro APR:Â 0% for the first 15 monthsÂ on all balances transferred within 60 days of account opening Foreign transaction fee: 2.7% Rewards: 2 points per dollar spent at US supermarkets, up to $6,000 per year 2 points per dollar spent on eligible travel purchases booked through amextravel.com 1 point per dollar on all other purchases Notable Perks & Benefits:Â Earn 20% extra points on your purchases if you make 20 or more purchases in a billing period Car rental loss and damage insurance More card details (click to expand) Hide

The card’s 0% APR on balance transfers lasts for 15 months and applies to all balances transferred over to the card within 60 days of getting your card. What’s more, all balances transferred over within the first 60 days will not have a balance transfer fee applied.

The 15-month 0% APR applies to purchases as well as balance transfers. In addition, you can earn rewards points for your spending. Many balance transfer credit cards lack a rewards program.

Want to check out some other credit card options for debt consolidation? Check out our article on the best credit cards for balance transfers.

Take Out A Personal Loan

Personal loans can be obtained from a bank, credit union, or online lender and can be used to pay off your credit card debts. Your interest rate will typically depend on your credit.

Is a personal loan the right debt consolidation method for you? Unfortunately, it depends on your credit. Well-qualified applicants should be able to obtain a loan with a low interest rate that will save the borrower money on interest payments, while those with poor credit may have trouble obtaining a loan with an interest rate that won’t be so high as to negate the debt-consolidation benefits of the loan. If this is you, you may want to check with a credit union before you go to other types of lenders, as credit unions tend to be more likely to accommodate borrowers with low credit scores than other types of lenders.

Furthermore, some online lenders offer loans tailored specifically for debt consolidation. Payoff is one such lender.

	Review Visit Site

Time in business: N/A Personal credit score: 640 or higher Business revenue: N/A Borrower requirements (click to expand) Hide

Payoff offers fixed-rate personal loans of up to $35,000 for debt consolidation to borrowers with a credit score of at least 640. The “fixed-rate” part is important as it means your monthly payments will always be the same amount, which should help with your budget planning.

Well-qualified applicants can get a loan with an interest rate less than that of most balance transfer credit cards — and you can check your potential interest rate on Payoff’s website without affecting your credit. Payoff will also send you a free monthly update of your FICO score.

Find A Nonprofit Credit Counseling Organization

If you’d like some personal attention to your specific debt situation, seek out a credit counseling organization. These organizations work with debtors on a one-on-one basis, offering advice and assistance in creating plans to help you climb out of debt. I would suggest looking for a nonprofit credit counseling organization accredited by the National Foundation for Credit Counseling (NFCC).

These organizations can help you set up a debt management program in which you make payments to the counseling agency in question. The agency then makes payments on each of your debts. They may even be able to negotiate lower interest rates or monthly payments for you.

The downsides to this debt consolidation approach are comparatively minor. You’ll probably have to pay a monthly service fee and a setup fee, and you may be required to close your credit cards after paying them off.

Take Money Out Of A Retirement Account

If you find that better debt consolidation options aren’t available to you, you can try borrowing from your employer-sponsored retirement account (such as a 401(k) or an IRA).

This isn’t a debt consolidation method of first resort, as the downsides are serious: you’ll have less money in your retirement account, you might have to pay income taxes and an early withdrawal penalty, and if you’re borrowing from your 401(k), you’ll have to repay the loan within 5 years (and if you lose your job, you’ll have to repay the loan within 60 days!). The consequences are worse if you can’t repay your loan. You’ll get hit with a big penalty as well as taxes on the unpaid balance, and you’ll be in more debt than ever.

Unless your circumstances are truly desperate, I wouldn’t recommend this method of consolidating your credit card debt!

Take Out A Home Equity Loan Or Line Of Credit

Here’s another high-risk debt consolidation method: You can borrow against the equity in your home (or possibly your vehicle) with a loan or line of credit. The repayment period can vary from 5 to 20 years but is commonly 10 years.

On the plus side, as this loan would be secured, you’ll get a lower interest rate than you’ll get with an unsecured loan, and you won’t need good credit. On the downside: if you can’t make your payments, you could lose your dang home!

Due to the manifest risk, this is another debt consolidation method of last resort. You don’t want to put your house at risk unless you’re supremely confident in your ability to repay the loan. And even then, you could still end up being wrong!

Next Steps: What You Should Do After Consolidating

Once you’ve consolidated your credit card debt, be sure to monitor your credit score regularly. Thankfully, there are ways to do this for free and without hurting your credit score.

Of course, along with monitoring your credit score, you’ll want to try to improve it! One way to do this is to simply make timely payments on all your debts (including credit card payments, obviously). Whenever you can, set up automatic payments.

For more on how to use your credit cards in a way that will improve, rather than hurt, your credit score, check out our article on how to build credit with a credit card.

One piece of advice typically given in this situation is to just cut back on your spending. However, given the skyrocketing cost of merely existing in this predatory world (much less raising kids, etc), this advice can be unrealistic and smacks of privileged condescension. Nevertheless, if you do spend a significant amount of your income on non-essential purchases, you might want to re-evaluate your spending habits!

Final Thoughts

The right debt consolidation strategy is invaluable when you’re trying to claw your way out from under credit card debt. The key is to find the strategy that best fits your particular circumstances. Merchant Maverick is here to help you in your quest!

For more on healthy credit card use and getting out of debt, check out the following articles:

Guide to credit card balance transfers
Top no fee balance transfer cards
How to cancel a credit card
Best free credit score sites
How to build credit with a card

The post Credit Card Consolidation: How to Consolidate Credit Card Debt appeared first on Merchant Maverick.

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July 4, 2019

Credit Cards With Car Rental Insurance: The Complete Guide

Travel often? Tired of paying extra for your rental carâs insurance? If you can find the right credit card, you may be able to skip forking over cash for a rental car companyâs coverage.

Included as a benefit on many travel cards, credit card car rental insurance can cover your rental car in case of damage. This means that if you book your rental through your card, you can decline any coverage offered by the rental car company.

Of course, not all credit card insurance is created equal. Plus, using your card in lieu of a rental car company waiver comes with its own set of headaches. To help you along, this guide is meant to give you insight into the nitty-gritty of credit card car rental insurance.

In some cases, business owners may need to opt for a personal card to receive proper car rental insurance while earning rewards that match their spending habits. This isnât a bad thing; personal cards can still work great for business expenses.

How Credit Card Car Rental Insurance Works

Car rental insurance is a benefit provided by numerous credit cards (especially those marketed as travel cards). Depending on the card, this benefit can act as primary or secondary insurance in case you are involved in a crash with a rental car. As is the case with most things surrounding credit cards, youâll need to check with your cardâs terms and benefits to see exactly what coverage you have.

As long as you have a credit card with solid car rental coverage, youâll be able to decline the rental car companyâs collision damage waiver (CDW) or loss damage waiver (LDW). This can save you moneyâitâs not unheard of for a waiver to cost as much as $30 per day.

If you are using a business credit card note that youâll likely need to be using the rental car for business purposes for the credit cardâs insurance to kick in.

Primary Insurance VS Secondary Insurance

Some credit cards will offer primary insurance, while others offer secondary insurances. Whatâs the difference?

Primary insurance: If your card offers primary insurance, then it can replace any other insurance you might have. By having a card with primary insurance, youâll be able to decline a CDW or LDW when the rental car associate asks you.

Cards known to come with primary car rental insurance include Chase Sapphire Preferred and Reserve, United MileagePlus Explorer and MileagePlus Club, Ritz-Carlton Visa Infinite, and the J.P. Morgan Reserve Card. Overall, there are fewer cards on the market that offer primary insurance for rental cars (compared to those with secondary insurance).

Secondary insurance: For those with secondary insurance on their card, your cardâs insurance will only activate after youâve gone through another insurance. This means youâll need to file a claim with a different insurance first (such as with your primary driving insurance, or the rental car companies).

Note that in some cases, if your card advertises secondary insurance, but you donât have primary insurance (for instance, if you donât own a car) the cardâs insurance will become your primary insurance on a rental car. Before declining the rental companyâs waiver, however, contact your issuer to make sure this option is available.

What Car Rental Insurance Typically Covers

Generally, your credit cardâs car rental insurance wonât cover damage to property outside the rental car, injury to others, and potential lawsuits. Additionally, you likely wonât be covered if your belongings are stolen from inside the car, nor if you have to pay ambulance bills. Of course, some of these situations may be covered by your normal car insurance, your health insurance, or your homeowner’s insurance.

In most cases, credit cards neglect covering rented luxury cars. However, there are a couple of exceptions. Chase Sapphire Preferred and Reserve holders can receive coverage for âselected modelsâ of BMW, Cadillac, Lincoln, and Mercedes-Benz. Citi also offers a few cards that simply cover up to $100,000 worth of damage to road-worthy four-wheeled vehiclesâregardless of make or model. American Express also provides a premium protection program that covers pickups, vans, sport-utility vehicles, and luxury vehicles valued above $50,000.

You also may be unable to utilize a cardâs insurance on car-sharing services like ZipCar or car2go. Instead, youâll probably only be covered on rentals via traditional car rental companies. To see if your card covers car-sharing services, check with your issuer.

Additionally, some credit cards do not provide coverage outside the United States. Other cards do, but they may exclude certain countries. Commonly excluded countries include Israel, Ireland, and Jamaica. Youâll need to confirm with your issuer to check if the country youâre visiting is included in your cardâs coverage.

In some cases, you may also not receive coverage if you book your car rental completely on points. If this is the case, you may need to pay with your card for at least one day to trigger coverage. Note that Chase is an exception to this; booking through Chase Ultimate Rewards while using points obtained from either Sapphire Preferred or Reserve still qualifies for rental insurance coverage.

Finally, some cards wonât cover car rentals that last longer than 31 days. There are also some that only cover up to two weeks. If you are planning to rent a car long-term, youâll likely need to end the rental within your cardâs insurance window. Then you can start a new rental.

How To Check If Your Credit Card Has Car Rental Insurance

If you are unsure if your credit card has car rental coverage, the easiest way to check is by reading through your cardâs terms and benefits. If you do not have an up-to-date copy of your terms and benefits, contact your issuer to get a new version sent to you. You may also be able to access a digital copy through your credit cardâs online portal.

You can also call your cardâs customer service line and ask your representative if your card has car rental insurance and what that insurance covers.

How To Use Your Credit Cardâs Car Rental Insurance

While using your credit card for car rental insurance may save you money, it doesnât come without its own set of hassles. Those looking for simplicity might want to sign the rental car companyâs waiver instead. Hereâs a look at what using your cardâs insurance may entail:

How To Apply Insurance To Your Rental

After youâve confirmed that your credit card offers car rental insurance, youâll usually need to book the rental with your card. Once you do that, youâll then need to decline the rental car companyâs CDW or LDW.

In some cases, rental companies require proof that your card offers insurance. If this is the case, it may be handy to print out a copy of your cardâs terms and benefits that you can show the rental car associate.

You also must make sure that all potential drivers of the car are listed on the rental agreement. This is especially true of the driver at the time of the accidentâyour issuer may void the insurance coverage if a different person is behind the wheel.

How To File A Claim

Processes vary from issuer to issuer, so youâll need to contact your cardâs issuer to find out what youâll need to submit a claim and how. In most cases, youâll be asked to share documents related to the rental car and any damage sustained. These documents could include an accident report, a police report, a rental agreement, repair estimates, and photographs.

Final Thoughts

If you book a rental car with the right credit card, you may be able to save lots of money while still receiving proper collision coverage. This means you can travel without worrying about spending money on unnecessary expenses. With plenty of credit cards to choose from, youâll likely be able to find one that matches your spending habits, too.

Curious which cards are best overall for travel? Check out the Merchant Maverick article on the best business credit cards for travel perks.

The post Credit Cards With Car Rental Insurance: The Complete Guide appeared first on Merchant Maverick.

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July 3, 2019

Top Metal Credit Cards For 2019

Metal credit cards promise sturdy construction and a premium in-hand feel. These cards are often heavier and thicker than regular cards, which helps prevent damage and theft. Plus, whipping out a metal card at checkout means that youâll stand out compared to other basic plastic cards.

Besides a deluxe build, metal credit cards usually come with better-than-average perks and rewards. Most metal cards are also targeted towards frequent travelers; however, there still are options for those who want more general reward categories.

Business owners will want to note that most of the credit cards listed below are marketed as personal cards. As such, they may not come with business-specific perks, such as employee cards or rewards targeted towards business-spending habits. However, personal cards are still a viable option for small businesses.

Curious to learn which metal credit card is best for your business? Keep reading to find out!

Best Metal Credit Cards For Travel

If youâre looking for a travel card, you wonât be lacking options if you also want one that comes in metal. While many metal cards include high annual fees, there are a few that are more affordable. Below are a couple of options with sub-$100 annual fees:

Venture from Capital One

Venture from Capital One Compare	Annual Fee: $95 ($0 the first year) Purchase APR: 17.99% – 25.24%, Variable
Required credit: Excellent Bonus offer: 50,000 miles once you spend $3,000 on purchases in your first 3 months Purchase intro APR:Â N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 2 miles per dollar spent on all purchases 10 miles per dollar at eligible hotels booked through Hotels.com (offer ends January 2020) Notable Perks & Benefits:Â Up to aÂ $100 credit for Global Entry or TSA PreCheck 24-hour travel assistance services Auto rental collision damage waiver Travel accident insurance Extended warranty Virtual card numbers More card details (click to expand) Hide

This card from Capital One features a simple two miles per dollar spent on all purchases. You also get the bonus of no annual fee during your first year (though itâs $95 thereafter).

For other perks, Venture comes bundled with 50,000 bonus miles once you spend $3,000 in your first three months. Until January 2020, youâll further be able to snag 10 miles per dollar on eligible hotels when you book at Hotel.com. Thereâs additionally up to a $100 credit available for your Global Entry and TSA PreCheck applications.

Chase Sapphire Preferred

Chase Sapphire Preferred Compare	Annual Fee: $95 Purchase APR: 18.24% – 25.24%, Variable
Required credit: Good, excellent Bonus offer: 60,000 points after you spend $4,000 on purchases in the first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 2 points per dollar spent on travel and dining at restaurants 1 point per dollar on all other purchases Notable Perks & Benefits:Â 25% more value when redeeming points for travel via Chase Ultimate Rewards Transfer points to other travel programs on a 1:1 point basis Travel and baggage delay insurance Auto rental collision damage waiver Trip delay reimbursement Purchase protection and extended warranty More card details (click to expand) Hide

For our other travel-focused metal card with a budget-range annual fee, itâs hard to go wrong with the Chase Sapphire Preferred. This card will net you two points per dollar spent on travel and dining, and one point everywhere else. Like with the Venture card, the annual fee will run you $95, although it’s waived the first year.

The real bonus of Chaseâs card is that when you redeem points for travel purchases through Chase Ultimate Rewards, your points will be worth 25% more. That means the cardâs bonus offer of 60,000 points after you spend $4,000 in the first three months is worth about $750 when redeemed for travel. If Chaseâs redemption portal isnât for you, there are over 10 travel partners where you can transfer points on a 1:1 basis.

Best Metal Credit Card For Points

Points credit cards can be a great tool for businesses, especially if you can redeem points for more than theyâd be worth as cash back. Unfortunately, there arenât many metal credit cards that deal out points not directly related to travel. Hereâs our top pick, though:

American Express Business Gold Rewards Card

American Express Business Gold Rewards Card Compare	Annual Fee: $295 Purchase APR: 16.49% – 24.49%, Variable
Required credit: Good, excellent Bonus offer:Â Up to 1 year free of G Suite Basic for 3 users and up to 1 year of ZipRecruiter Standard in the form of statement credits for purchases in your first 12 months and earn 35,000 points when you spend $5,000 in your first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee:Â None Rewards: 4 points per dollar on 2 categories (out of 6 available) where your business spends the most each billing cycle 1 point per dollar on other purchases Notable perks & benefits: 25% airline bonus when you book your flight through American Express Travel using Membership Rewards Pay $100 hotel credit on qualifying charges when booking two consecutive nights with American Express’s Hotel Collection No preset spending limit Employee cards available Global Assist Hotline forÂ 24/7 access to medical, legal, financial and other select emergency coordination and assistance services Travel and transportation coverage Extended warranty and purchase protection More card details (click to expand) Hide

American Express Business Gold Rewards Card

Compare

Annual Fee:

$295

Purchase APR:

16.49% – 24.49%, Variable

Required credit: Good, excellent

Bonus offer:Â Up to 1 year free of G Suite Basic for 3 users and up to 1 year of ZipRecruiter Standard in the form of statement credits for purchases in your first 12 months and earn 35,000 points when you spend $5,000 in your first 3 months

Purchase intro APR: N/A

Balance transfer intro APR: N/A

Foreign transaction fee:Â None

Rewards:

4 points per dollar on 2 categories (out of 6 available) where your business spends the most each billing cycle
1 point per dollar on other purchases

Notable perks & benefits:

25% airline bonus when you book your flight through American Express Travel using Membership Rewards Pay
$100 hotel credit on qualifying charges when booking two consecutive nights with American Express’s Hotel Collection
No preset spending limit
Employee cards available
Global Assist Hotline forÂ 24/7 access to medical, legal, financial and other select emergency coordination and assistance services
Travel and transportation coverage
Extended warranty and purchase protection

More card details (click to expand)

Hide

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If youâre in the market for a metal credit card, but donât want something directly aimed at travel, the Business Gold Rewards Card from American Express could be a great option for business owners. While all purchases net one point per dollar spent, youâll collect four points per dollar on your two highest spending categories. The eligible categories for the bonus points are:

Airfare purchased directly from airlines
US advertising purchases in select media (online, TV, radio)
US purchases made directly from select technology providers of computer hardware, software, and cloud solutions
US gas station purchases
US restaurant purchases
US shipping purchases

Note that this card does require an annual fee of $295. However, you gain access to a range of perks, including: 25% airline bonus when you book flights through American Express Travel, hotel credit, and employee cards. Thereâs an additional welcome offer of up to one year free of G Suite Basic for three users and up to one year of ZipRecruiter Standard. Amex rates those bonuses up to $3,200 combined.

Curious to learn more about the Amex Business Gold card? Visit the Merchant Maverick review.

Best Metal Credit Cards For Cash Back

With usually simple redemption methods, cash back cards are a popular option for those who donât want to worry about jumping through hoops. Like with points cards, metal cards with strictly cash back redemption methods are somewhat of a rarity. Still, there are a couple worth considering:

Capital One Savor Rewards

Savor Rewards from Capital One Compare	Annual Fee: $95 ($0 the first year) Purchase APR: 16.74% – 25.74%, Variable
Suggested credit: Excellent Bonus offer:$400 cash back if you spend $3,000 on purchases within 3 months from account opening Intro purchase APR: N/A Intro balance transfer APR:Â N/A Foreign transaction fee: None Rewards: Unlimited 4% cash back on dining & entertainment Unlimited 2% cash back on groceries Unlimited 1% cash back on all other purchases Other Benefits:Â Complimentary concierge service $0 fraud liability Auto rental damage waiver Travel accident insurance Extended warranty and purchase protection More card details (click to expand) Hide

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If cash back is more your thing, Capital One offers a metal card in the form of Savor Rewards. Like with Capital Oneâs other card on this list, this card requires a $95 annual fee thatâs waived the first year. In terms of rewards, youâll score 4% cash back on dining and entertainment purchases, 2% back on groceries, and 1% back on everything else. On top of those base rewards, ticket purchases through Vivid Seats earn 8% cash back until May 2020.

Youâll additionally receive a complimentary membership to Postmates Unlimited through December 2019. This is a potential boon for businesses that buy employees lunch because orders above $15 avoid paying delivery fees. You can further receive $300 cash back by spending $3,000 within your first three months.

Amazon Business Prime American Express Card

Amazon Business Prime American Express Card Compare	Annual Fee: $0 Purchase APR: 16.24% â 24.24%, Variable
Required credit: Good, excellent Bonus offer:Â $125 Amazon.com gift card upon approval (if you have an eligible Amazon Prime membership) Purchase intro APR:Â N/A Balance transfer intro APR: N/A Foreign transaction fee:Â None Rewards: If you have an eligible Amazon Prime membership:Â 5% back or an extra 90 days interest free on purchases at Amazon Business, AWS, Amazon.com and Whole Foods Market If you do not have an eligible Amazon Prime membership: 3% back or an extra 60 days interest free on purchases at Amazon Business, AWS, Amazon.com and Whole Foods Market 2% back on purchases at U.S. restaurants, U.S. gas stations, and on wireless telephone services purchased directly from U.S. service providers 1% back on other purchases Notable perks & benefits: Employee cards available Employee purchase control withÂ multi-user accounts, shared payment methods, approval workflows, and spending limits Purchase protection, extended warranty, and travel coverage Access to Amex Offers More card details (click to expand) Hide

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A rarity in the world of metal credit cards, the Amazon Business Prime American Express Card does not have an annual fee. However, you will need to have an Amazon Prime account (which annually costs $59 for students, $119 for personal accounts, and $179 for business accounts) to take full advantage of the cards benefitsâincluding receiving a metal card.

Itâs also worth mentioning that this is a business-specific card, so youâll get employee card options as well as various spending tools. Youâll also snag a $125 Amazon gift card upon approval and you can refuse rewards in exchange for an extended interest-free period on purchases at Amazon Business, AWS, Amazon.com and Whole Foods Market.

Get the full picture of the Amazon Business Prime Card by checking out our review.

Best Luxury Metal Credit Cards

The highlight of metal credit cards, luxury cards often feature solid rewards with some unique perks, like travel credit and special hotel benefits. However, they also come with extravagant annual fees and usually require an excellent credit history. Hereâs a couple of our favorites:

Mastercard Black Card

Mastercard Black Card Apply Now	Annual Fee: $495 Purchase APR: 17.24%, Variable
Required credit: Excellent Bonus offer: None Purchase intro APR:Â N/A Balance transfer intro APR: 0% for the first 15 billing cycles Foreign transaction fee: None Rewards: 1 point per dollar spent 2% value for airfare redemptions 1.5% value for cash back redemptions 1% value forÂ hotel stays and car rental redemptions Notable Perks & Benefits:Â 24/7 Luxury Card Concierge Luxury gifts fromÂ brand name companies Room upgrades, complimentary food and beverage, and spa credits when booking with Luxury Card Travel Travel benefits, including global luggage delivery,Â 24/7 chauffeured transportation, and private jet/yacht chartering services $100 annual airline credit Priority Pass Select VIP airport lounge access Global Entry & TSA PreCheck application credit More card details (click to expand) Hide

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When it comes to premium cards, the Mastercard Black Card from Luxury Card is among the first names to pop into peopleâs minds. With 46 patents globally, the steel and carbon fiber build is instantly recognized for its classy design and exclusivity. Itâs also one of the heaviest metal cards available.

With this card, youâll get an effective 2% back on travel redemptions, 1.5% on cash back, and 1% back on all other redemption methods. You will need to keep in mind the $495 annual fee, but the Black Card comes with an array of extra benefits, including:

24/7 Luxury Card Concierge
âLuxury Giftsâ from name brands
$100 annual airline credit
Global Entry & TSA PreCheck application credit
Priority Pass Select VIP airport lounge access
Complimentary hotel benefits with an average total value of $500 per stay

These benefits are just the tip of the iceberg when it comes to the Black Card. Want to learn more? Read the Merchant Maverick review for all the deets.

Chase Sapphire Reserve

Chase Sapphire Reserve Compare	Annual Fee: $450 Purchase APR: 19.24%â26.24%, Variable
Required credit: Good, excellent Bonus offer: 50,000 points after you spend $4,000 on purchases in the first 3 months Purchase intro APR: N/A Balance transfer intro APR: N/A Foreign transaction fee: None Rewards: 3 points per dollar spent on travel and dining at restaurants 3 points per dollar spent on travel worldwide immediately after earning your $300 annual travel credit 1 point per dollar spent on all other purchases Notable Perks & Benefits:Â $300 Annual Travel Credit 50% more value when redeeming points for travel via Chase Ultimate Rewards Travel and baggage delay insurance Auto rental collision damage waiver Trip delay reimbursement Purchase protection and extended warranty More card details (click to expand) Hide

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Those looking for a more low-key card, but still want some luxury benefits, may find the Chase Sapphire Reserve to be a good fit. This cardâs reward rates start at three points per dollar on travel and restaurant purchases. Youâll then snag the standard one point per dollar on all other purchases.

Like with the Black Card, youâll need to fork over a hefty annual fee (this one clocks in at $450 per year). However, points redeemed through Chase Ultimate Rewards generate 50% more value (effectively giving you 4.5Â¢ per dollar on travel and restaurant purchases and 2Â¢ per dollar on everything else). Youâll also collect a $300 annual travel credit, a $100 fee credit for Global Entry and TSA PreCheck credits, and special benefits at a range of hotels.

Want to find out more about luxury credit cards? Check out our more in-depth article on premium-level cards.

How To Destroy A Metal Credit Card

Because these cards are made of metal, things can be tricky when it comes time to get rid of them. You probably wonât be able to cut them with scissors, like you might with a standard plastic card. Itâs also not recommended to shred the cardâthe metal may damage your shredder.

Instead, your best bet will to send the card back to your issuer. Contact the company that issued your card to find out if theyâll take back the old card. Your issuer may also include an envelope for this very purpose along with your new card. If this is the case, youâll simply need to seal your old card in the envelope and drop it in the mail.

Final Thoughts

With plenty of options, there should be a metal card that fits within your businessâs needs. Especially when it comes to travel, most metal cards include stellar rewards with enticing perks, from travel credits to impressive welcome offers.

Canât find the right card? Keep looking by checking out Merchant Maverick’s best all-around business cards.

The post Top Metal Credit Cards For 2019 appeared first on Merchant Maverick.

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July 3, 2019

Can Merchants Set Minimum Amounts On Card Transactions?

So, youâve opened your business, and youâre starting to rack up a lot of sales. Youâve even signed up for a merchant account so your customers can use their credit cards. Things seem to be going great â until you notice something a little unsettling.

You knew when you opened your merchant account that youâd have to pay for credit (and debit) card processing, but $0.15 or $0.20 per transaction (in addition to the percentage charge) didnât seem like it would be a big deal. Unfortunately, a lot of your customers come in and only buy a single item, maybe something for $3.00 or less. They donât carry any cash and want to use their credit card. However, your margins are so thin on low-priced items that the fixed per-transaction fee you pay for processing can wipe out your profit. In fact, you might even lose money on some sales if the customer uses a credit card.

Naturally, youâd like to avoid this situation altogether. You remember being in other stores that had a policy of only accepting âplasticâ if the total sale was at least a certain amount (say, $10.00, for example). Youâd like to implement a policy like this yourself, but youâre not sure if itâs legal.

In this article, weâll review the laws and agreements that govern setting a minimum amount on credit and debit card transactions. Weâll also discuss the pros and cons of doing so, even in situations where itâs perfectly legal. After all, you donât want to risk losing sales when customers either canât or donât want to buy enough items to meet your required minimum. Finally, weâll review the differences between setting a minimum purchase requirement on credit card and debit card transactions.

Can You Implement A Minimum Charge On Credit Card Purchases?

Hereâs the short answer: Yes, you can set a minimum charge on credit card purchases. However, there are several legal and contractual limitations on doing this, so keep reading! Youâll want to understand all the applicable restrictions on this practice before you try to implement it in your business.

Prior to 2010, setting a minimum credit card charge was governed entirely by the processing agreements set forth by the major credit card associations (i.e., Visa, Mastercard, etc.). Every major card brand prohibited the practice, because they wanted to make money off credit card usage and they simply didnât care if merchants lost money on small-ticket transactions.

However, in 2010, the Federal government weighed in on the issue. When the Dodd-Frank Wall Street Reform and Consumer Protection Act was passed by Congress in the aftermath of the Great Recession of 2008, it took many steps to rein in the reckless behavior of the big banks that had contributed to the recession. Part of this legislation, the Durbin Amendment, contains the following provision:

(3) NO RESTRICTIONS ON SETTING TRANSACTION MINIMUMS OR MAXIMUMS.âA payment card network shall not, directly or through any agent, processor, or licensed member of the network, by contract, requirement, condition, penalty, or otherwise, inhibit the ability of any person to set a minimum or maximum dollar value for the acceptance by that person of any form of payment.

In other words, the Federal government has effectively overruled the previous contractual limitations imposed by the credit card associations. Merchants are now free to set a minimum purchase requirement if they want to. However, their ability to do so is not unlimited. A separate provision in the Durbin Amendment authorizes the Federal Reserve to define the highest allowable minimum purchase requirement that may be imposed, and they can change this limit from time to time if they see fit. As of this writing, the highest allowable minimum purchase requirement that merchants can set is $10.00. Youâre free to set a lower requirement if you want to, but you cannot set a limit above this amount.

While the credit card associations can no longer stop you from setting a minimum purchase requirement, they have modified their processing agreements to ensure that any minimum imposed is fair and equitable. Visa, Mastercard, and Discovery all have several stipulations on setting minimum charges in their processing agreements. The gist of these stipulations is that a minimum purchase requirement, if imposed, must treat all credit cards and all issuing banks equally. In other words, you canât require a minimum purchase for Visa, but not Mastercard. You also canât set a minimum purchase for one issuing bank, but not another. Having different minimum purchase amounts for different cards or issuing banks is also not allowed. American Express is a little different, as they donât mention minimum purchase requirements at all in their processing agreements. We recommend that you apply the same minimum purchase requirements for American Express cards as you do for any other card brand.

Can You Implement A Debit Card Minimum Purchase Amount?

Now that weâve established how you can set a minimum purchase requirement for credit cards, youâll probably want to know if the rules are the same for debit cards. Of course, theyâre not. That would be too easy, right?

With few exceptions, the general rule is that you cannot impose a minimum purchase requirement for debit card transactions. Why not? Well, the Durbin Amendment also placed some strict limits on the interchange fees (and PIN debit network fees) that banks could charge for processing debit transactions. However, the Amendment doesnât prohibit the credit card associations from imposing their own restrictions on minimum purchases the way it does for credit cards. Naturally, the card networks responded to this change in the law by immediately strengthening their prohibitions against minimum purchase requirements for debit cards. While this might seem unfair to merchants, realize that the new limits on debit card processing fees cut deeply into the card networksâ revenue. Being able to prevent merchants from imposing minimum purchase requirements has the effect of partially compensating the card networks for this loss of income.

How will these changes affect your business? As usual, there isnât a simple answer, and the impact on your processing costs will depend on what type of processing rate plan you have, among other factors. If your merchant account uses an interchange-plus or membership-based processing rate plan, the inability to set a minimum purchase requirement wonât be a problem. Thatâs because both of these types of plans pass interchange and PIN debit network fees directly onto you. Interchange fees and PIN debit network fees for debit card transactions are very low, thanks in part to the Durbin Amendment and also because these types of transactions cost very little to process and involve a very low degree of risk to the processor. In other words, you wonât need to set a minimum purchase requirement in the first place, because processing small-ticket sales wonât have an impact on your profitability.

What Happens If My Processor Treats Debit Cards As Credit?

Of course, things are never simple in the processing world. Merchants who are on a flat-rate or tiered pricing plan have several other factors to consider. Flat-rate pricing, such as that offered by Square (see our review), charges the same rate for both credit and debit cards, essentially treating debit card transactions as if they were credit card transactions. While this makes your costs much more predictable and easy to understand, it also means that youâre paying far more than necessary to process debit card transactions.

Tiered pricing, on the other hand, varies depending on your processor and how they structure their tiered rate plans. Some processors have separate (and usually much lower) tiers for debit card transactions, while others lump both debit and credit card transactions together and treat them identically.

Why is there a difference in how debit card transactions can be treated? The answer usually depends on how the transaction is verified at the point of sale. Briefly, debit card transactions can be verified using either the PIN debit method or the signature debit method. With PIN debit, the customer verifies their identity by inputting their 4-digit Personal Identification Number (PIN) when making a purchase. This routes the transaction to a PIN debit network rather than a credit card network. Because this type of transaction is considered to be more secure, PIN debit network fees are very low.

Signature debit transactions, on the other hand, require the customer to sign their receipt to verify their identity. With this verification method, the transaction will be routed to a credit card processing network and regular interchange fees will be assessed. Remember, published interchange fees for debit transactions are also very low. However, your merchant account provider may or may not pass those lower rates onto you. If you have a flat-rate pricing plan or a tiered plan that doesnât include a separate tier for debit transactions, youâll end up paying the same processing rates as you would for credit card transactions. For more details on how debit card transactions are processed, please see our article, The True Cost Of Debit Card Transactions.

If youâre paying the same processing rates for both debit and credit card transactions, can you still impose a minimum purchase requirement that applies to both types of transactions? You would certainly be justified in doing so since youâre paying an artificially high amount for accepting debit cards. The answer is that it will depend on your processing agreements with the major credit card associations and your contract with your merchant account provider. We recommend that you refer to those documents before setting a minimum purchase requirement. You might also consider imposing a minimum purchase requirement that only applies to credit card transactions, especially if youâre paying fair market rates for debit card transactions through your processor.

Final Thoughts

Now that weâve thoroughly discussed the legalities of minimum purchase requirements, letâs consider whether you should go ahead with doing so. Yes, youâll avoid losing money on small purchases. At the same time, you run the risk of losing sales when customers canât use their credit cards and donât have any cash on them. Like it or not, most consumers are oblivious to the fact that accepting credit and debit cards costs you money.

There are several options you should consider if small-ticket sales are costing you too much in processing fees. Your first option is to review your merchant account contract and confirm that youâre on an interchange-plus or membership-based pricing plan. These two types of plans give you the lowest per-transaction processing costs, and you shouldnât need to implement a minimum purchase requirement at all. If youâre on a flat-rate or tiered pricing plan, on the other hand, youâll want to check a few things. Does your plan have a lower rate for debit cards, or does it treat both debit and credit cards the same? If youâre on a flat-rate plan, does the lack of monthly and annual account fees compensate for the higher processing rates? Many small businesses sign up for a flat-rate service like Square due to the low up-front costs, but fail to realize that once they reach a certain processing volume (typically around $5,000 per month), it actually costs more to use Square (or any other flat-rate service) than a traditional merchant account.

Another option to lower your processing costs is surcharging. This is the practice of passing your processing costs onto your customers by adding a surcharge to credit and debit card purchases. We recommend you exercise caution in considering this option. While surcharging is now legal in most (but not all) jurisdictions, it can result in lost sales unless youâre in an industry where the practice is common and accepted. For more details, please see our article, Your Complete Guide to Credit Card Surcharges.

If you do decide to implement a minimum purchase requirement, make sure that you set it as low as possible to reduce the frequency of lost sales and frustrated customers. Under no circumstances should you implement a minimum that exceeds $10.00 â customers can report you to the credit card associations, and youâll probably have your merchant account shut down. You might even end up on the Terminated Merchant File (TMF, or MATCH list), making it that much more difficult to find a new processor.

Implementing a minimum purchase requirement also means that youâll have to educate your employees to enforce it. Make sure they understand the difference between a credit card and a debit card. This isnât as obvious as it sounds, as most debit cards are sponsored by either Visa or Mastercard. Theyâll also need to understand the difference between PIN debit and signature debit, as you usually wonât be able to enforce a minimum purchase requirement on PIN debit transactions.

If youâve read this far and come to the conclusion that your best option is to switch to a different merchant account provider, we can help. Check out our Merchant Account Comparison Chart for a side-by-side comparison of the best providers in the industry.

Our Top-Rated Merchant Services Providers

heading	Payment Depot	National Processing	Fattmerchant	Dharma	Square
	Payment Depot	National Processing	Fattmerchant	Dharma Merchant Services	Square Payments

	Get Started Review	Get Started Review	Get Started Review	Get Started Review	Get Started Review
Availability	US-based businesses	US-based businesses	US-based businesses	US-based businesses	US, Canada, UK
Serves in-store, mobile, and eCommerce	â	â	â	â	â
No early termination fees	â	â	â	â	â
Compatible with most POS systems	â	â	â	â
Rate matching / negotiableÂ	â	â	â	â
High-quality sales and customer service	â	â	â	â
Pricing model	Interchange-plus	Interchange-plus	Interchange-plus	Interchange-plus	Flat rate
Monthly fee	$49	$10	$99	$20	$0
Standard retail rates	0% + $0.15 markup	0.20% + $0.10 markup	0% + $0.08 markup	0.15% + $0.07 markup	2.75% total
Good for higher volume (over $20K/month)	â	â	â	â
Good for mid volume ($10K-20K/month)	â		â	â
Good for lower volume (under $10K/month)	â	â			â
Good for selling occasionally					â
Instant account setup					â
	Get Started with Payment Depot	Get Started with National Processing	Get Started with Fattmerchant	Get Started with Dharma MS	Get Started with Square Payments

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April 26, 2019

0% APR Credit Card Offers: The Complete Guide

Credit card debt is a curse that can be exceedingly difficult to dispel. Those struggling to deal with debt may find that interest payments cripple their efforts to pay down debt, thus perpetuating the vicious circle of indebtedness.

Of course, the underlying problem isn’t the credit cards or their users; it’s the fact that the necessities of life (housing, education, health care, etc) grow less and less affordable by the day, thus making the average person choose between credit card debt and generational immiseration, homelessness, early death, and other consequences of American poverty. However, there’s something you can do to minimize the interest that gets tacked onto your credit card debt: Get a credit card with a 0% introductory APR offer.

What Is A 0% Introductory Offer?

Many credit cards, both personal and business, come with introductory 0% APR periods. These periods typically last 9 to 12 months but can last for as long as 18-21 months. During this time, you won’t be charged interest on your debt.

Now, an intro 0% APR may not necessarily apply to all the debt you accumulate with the card in question. That’s why it’s important to distinguish between two common types of 0% introductory offers: those that apply to purchases and those that apply to balance transfers.

Balance Transfer Intro Rates VS Purchase Intro Rates

When you examine the details of your 0% introductory offer (always examine the details, folks!), you may find that the 0% APR offer applies to purchases. AÂ 0% introductory purchase APR is simple: For the length of the offer, you will not be charged any interest on the credit card debt you’ve accumulated via purchases. This leaves out the debt on your credit card that didn’t come from purchases, including balance transfers.

Accordingly, another type of popular credit card offer is the 0% introductory rate on balance transfers. With these offers, you can transfer a balance to your card and pay no interest on that balance for the length of the 0% APR period.

Now, many cards feature 0% introductory rates on both purchases and balance transfers. These cards are ideal if you’re looking to both avoid interest charges on your purchases and consolidate your existing credit card debt onto a card that won’t charge interest on that debt. Obviously, these cards are ideal for debt reduction purposes. Here’s what to keep in mind if you end up having to choose between the two:

Get a card with an introductory 0% APR on balance transfers if you intend to use your card to pay down your existing high-interest credit card debt. An important caveat: These offers often restrict when you can make a balance transfer and have the intro 0% APR apply. For example, when you read the fine print, the offer may say “0% intro APR for 15 months on balance transfers made within 45 days of account opening.” This seems confusing and contradictory at first glance, but what it means is that in order to enjoy 15 months of not being charged interest on your balance transfer, you have to make that transfer within 45 days of opening your credit card account.
- Additionally, a credit card may charge you a balance transfer fee even if it doesn’t charge you interest on your balance transfer for a certain length of time. The balance transfer fee is entirely separate from the balance transfer APR. A common balance transfer fee policy is something like “Either $5 or 5% of the amount of each transfer, whichever is greater.” However, there are a few credit cards that offer both a lengthy intro 0% APR on balance transfers and no balance transfer fee. If you’re looking for a good card for debt consolidation, look for one of those!
Get a card withÂ an introductory 0% APR on purchases if your goal is to cover a large expense (or a series of large expenses) while avoiding interest charges. An intro 0% APR on purchases will let you cover that medical emergency or vacation or car repair bill and then gradually pay for the expense over the course of your introductory 0% APR period without paying any interest.

Pros & Cons Of 0% Intro Offers

On the pro side, 0% intro APR offers can benefit you by letting you pay for large expenses over a specified length of time without paying interest and by letting you transfer balances to the card and not pay interest on said balance during the 0% APR period. You can even transfer other forms of debt to your card such as college loans and personal loans. Just don’t transfer more than you can pay down during the 0% APR period — otherwise, you could face steep interest charges after the intro 0% APR period ends.

As for cons, there are none. Unless you enjoy experiencing pain for the sake of experiencing pain — and that’s fine; I’m no kink-shamer — there is no downside to having smaller credit card bills than you would have otherwise.

The worst you could say about credit cards with long 0% intro APR offers is that they may possibly — but not necessarily — be lacking in other respects. For example, you may find a card that would save you money on interest payments after paying for your dog’s surgery, but whose annual fee would negate some or all of what you would otherwise save.

I’m not saying you should be wary of 0% introductory rates. I’m just saying there are other factors to consider when choosing the right credit card for your needs.

0% APR Intro Rates VS Deferred Interest

Deferred interest deals come with huge downsides and are not the same thing as introductory 0% APR offers. Let’s tackle the thorny subject of deferred interest.

Most major credit card issuers don’t offer deferred interest deals. These deals are most often found in store credit cards such as those issued by Walmart/Sam’s Club (I do believe in corporate-shaming).

What happens is this: You buy a refrigerator or a sewing machine under a deferred interest financing arrangement (it may be offered as “no interest for 12 months” or something). The terms of the deferred interest deal state that you won’t be charged interest on the purchase for 12 months unless you don’t pay off the purchase completely within that 12 months. If even a single cent of your purchase remains unpaid after 12 months, you’re then immediately hit with all the interest you would have been charged on the entire purchase over the prior 12 months.

In effect, your interest-free period is retroactively canceled.

This is not what happens with a genuine introductory 0% APR offer. With these offers, if you have a balance remaining on the purchases you made during the intro 0% APR period after the 0% APR period ends, you then become responsible for paying interest on the remaining balance in subsequent billing cycles. You are not retroactively charged for the interest that would have accrued during your 0% APR period.

For more on why deferred interest is a gilded scam from the predatory depths of exploitation hell, read our article about deferred interest and why you should avoid it.

Intro Rate Best Practices

The one thing you can do to get your intro 0% APR canceled is to miss a monthly minimum payment. When you miss a monthly payment, your card issuer will likely cancel your 0% APR period, thus subjecting you to the regular ongoing APR (or, worse, a penalty APR significantly higher than the regular ongoing APR) in subsequent billing cycles. Furthermore, your credit score will suffer damage. Try to make those monthly payments!

Final Thoughts

At a time when (according to the Federal Reserve) folks are drowning in more debt than ever before, any financial strategy that can result in less debt should be explored. Credit cards with long introductory 0% APR periods are obviously not a panacea for debt woes, but they can make a crucial difference in how much of your hard-earned cash you’ll be handing over to your creditors each month.

Still looking to save on interest payments with your next credit card? Check out these helpful resources!

Best business credit cards with 0% APR offers
APR vs interest rate
Deferred interest explainer

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April 19, 2019

How To Start A Pet Sitting Business: The Complete Guide

Have you always had an affinity for furry (or scaly) things? Have you ever needed money? If you answered yes to both these questions, you may want to consider starting a pet-sitting business.

But before you pick up the leashes and pooper-scoopers, it’s a good idea to sit down and plan out the trajectory of your business. If that sounds overwhelming, don’t fret. Below, we’ll lay out the steps you can take to start a pet-sitting business.

Decide On A Location

Since you’re going to be dealing with people’s pets, you’ll need to take into account your proximity to your clients. If they’re dropping their pets off with you, you’ll want to be located somewhere easily accessible to most of your customers, and one that can accommodate animals. Depending on where you live, this can be tricky as the space necessary to accommodate animals will usually be cheaper in less centralized locations.

On the other hand, if you’re going to your customers, you’ll need to take into account the amount of time you need to spend with each client’s pets, the costs of commuting to the job, and how animal-friendly/animal-hostile the infrastructure in your service area is (dog parks, etc.).

Register Your Business

Why should you register your business? Depending on your local laws, you may actually be required to register your business in order to legally pet-sit. But even in jurisdictions where it isn’t compulsory, there are some advantages to doing so.

The first is that you can do business under a name other than your own. So instead of Martha Swearingen, LLC, you can do business as Baron Bark’s Pet Pampering Service (you can have that one for free).

The default configuration for businesses is aÂ sole proprietorship (or a partnership, if you’re starting it with someone else). This essentially means that you’ve started a business with your own name or, if you file a DBA (Doing Business As), a name of your choice.

Sole proprietorships have the advantage of being cheap and easy to start. Your taxes will also be easier to file (and lower) than they would generally be with other forms of incorporation. Keep in mind, however, that for liability purposes, sole proprietorships and the individuals behind them are essentially one and the same.

Other forms of incorporation will require a bit more work and come with their own advantages and disadvantages.Â Most pet-sitting companies aren’t going to be interested in forming C-suites for governance, so you can probably ignore S-Corps and C-Corps for now. You may, however, want to consider forming an LLC to provide some separation between your personal finances and liabilities and your business ones.

Here are the most popular ways to incorporate:

Limited Liability Corporations (LLCs):Â If you’ve seen LLC after a corporation’s name, you’re dealing with this type of company. LLCs offer limited liability protection for their owners without the full complexity of a corporation. Each state has its own rules for how to start and maintain an LLC, and you don’t necessarily have to register your LLC in the state where you’re doing business (although you’ll generally want to). LLC owners report theirÂ business earnings and losses on their personal taxes.
C-Corp:Â This is the “basic,” default form of incorporation. Shareholders are considered the owner(s) of the company and receive limited liability protection; however, the business decisions are made by corporate officers who may or may not be shareholders. The corporation is taxed separately and shareholders pay income tax on dividends. To form a C-corp, you’ll file articles of incorporation with your state.
S-Corp:Â S-corps are similar to C-corps in most ways, but come with a few additional restrictions: you have to have fewer than 100 shareholders and they have to all be U.S. citizens or residents. Unlike C-corps, profits and losses are reported on personal taxes, not unlike an LLC. In addition to filing articles of incorporation, you’ll also need to file IRS Form 2553.

Get Business Insurance

As a pet-sitter, you’re not just dealing with property, you’re dealing with animals whose owners often view them as part of their family. In other words, if something goes wrong, things could get ugly.

Depending on your local laws, you may be required to carry certain types of insurance.

The type of insurance that will probably be of most interest to you is general liability insurance. This protects you in the event of a lawsuit or accident, whether it’s an accidental injury to the animal or if you accidentally damage property within a client’s home. It doesn’t only protect you, however; it also makes you look like a safer option than a business that isn’t covered.

There are other, more specialized types of insuranceÂ that are worth taking a look at depending on the specifics of your business. These include:

Property Insurance: Protects the property needed to run your business (as opposed to damages you cause to clients’ property).
Business Interruption: Covers costs related to unforeseen events that make your business unable to function.
Professional Liability (Error and Omissions): Covers the costs of defending your company in lawsuits in cases where your business caused a financial loss.

If you aren’t sure where to look, we can help you.

Invest In Business Software

While not absolutely necessary, you can save yourself and your customers some hassle with strategically chosen business software. For pet sitting, there are probably three types most worthy of consideration.

Payment Processing

Doing business with cash can be convenient when you’re first starting out, but as you grow, you’ll probably be missing out on clients if you can’t accommodate other forms of payment.

Recommended Option: Square

Best Overall Mobile POS	Review Visit Site

Highlights No contract or monthly fee Instant account setup Retail upgrade available Restaurant upgrade available For iOS and Android mobile devices 2.75% per in-person card swipe	Retail POS:Â Free trial ($60/mo value) Â Restaurant POS: Free trial ($60/mo value) Â Square POS: Always free

If you have an iOS or Android device, Square offers an extremely convenient way to accept mobile payments while on the go via a small add-on you plug into your device. It’s also a very scalable service; if you’re running a retail location, there are even more features and service options you can take advantage of.

Best of all, there aren’t any monthly fees to worry about. Square charges between 2.75Â – 3.5 percent per transaction (depending on whether you swipe or key in the info), so you’ll want to factor those costs into your expenses.

Scheduling Software

As you add clients, it will get harder to remember their particular preferences, not to mention more difficult to fit them all into your schedule. With booking or scheduling software, you can track your time, note customer needs, and efficiently plan your days’ work. Many of these offer their basic features free of charge.

Accounting Software

Most businesses can benefit from accounting software. What you don’t want is to spend money unnecessarily on one. Wave offers most of the features you need at no cost.

With no monthly fee, you’ll get invoicing, estimates, contact management, expense tracking, accounts payable, and inventory tracking.

Seek Funding

Pet-sitting, especially, if you’re going to your clients, doesn’t have a lot of overhead when you’re first starting out. In the event that you do need to scare up some money to cover starting expenses or equipment, there are a number of options available to you.

Personal Savings

If you can avoid taking on debt, it’s usually a good idea. It may hurt to part with some of your rainy day funds, but you won’t be accumulating expensive interest and fees.

Tap Your Support Network

If you do need money from an outside source, you can often get a better deal from your support system than you can from a private lender.

Keep in mind that this comes with its own risks. You may stress your relationships, especially if you aren’t able to pay back these so-called friendly loans quickly. One way to avoid this is to formalize any agreements you make with friends and family so that everyone fully understands what they’re getting into and what the expectations are. You may even want to draw up a formal contract that outlines any expected payments and return on investment.

Credit Cards

For the relatively low expenses you will encounter when you start a pet-sitting business, credit cards can probably suffice for most of your needs.

The general rules of thumb when it comes to using credit cards effectively are these:

Use credit cards for expenses that you can pay off within their interest-free grace period.
Pick a card with a reward program that matches your spending habits and needs.
Do not take out cash advances on your credit card.

If you follow these rules, you can actually save money by using your credit card to make purchases.

Recommended Option: American Express SimplyCash Plus

SimplyCash Plus Business Credit Card from American Express Compare	Annual Fee: $0 Purchase APR: 14.49% – 21.49%, Variable
Required credit: Good, excellent Bonus offer: None Purchase intro APR: 0% for the first 9 months Balance transfer intro APR: N/A Foreign transaction fee: 2.7% Rewards: 5% cash back at U.S. office supply stores and on wireless telephone purchases, up to $50,000 per year 3% cash back on a category of your choosing (airfare, hotel rooms, car rentals, gas stations, restaurants, advertising purchases, shipping, or computer hardware, software, and cloud computing), up to $50,000 per year 1% cash back on all other purchases Notable perks & benefits: Expanded buying powerÂ â buy above your credit limit with no penalty fees Employee cards available Extended warranty & purchase protection Car rental loss & damage insurance More card details (click to expand) Hide

Amex’s SimplyCash Plus offers one of the best cash back programs available without an annual fee. You’ll get 1 percent back on generic purchases, 5 percent back on wireless telephone purchases and office supply stores in the U.S. But it’s the middle tier that’s most interesting. You can select a category of your choosing (airfare, hotel rooms, car rentals, gas stations, restaurants, advertising, shipping, or computer hardware) to get 3 percent back.

It also carries an introductory 0% APR for the first nine months, which can be helpful if you’re just starting out.

Recommended Option: Amazon Business Prime American Express Card

Amazon Business Prime American Express Card Compare	Annual Fee: $0 Purchase APR: 16.24% â 24.24%, Variable
Required credit: Good, excellent Bonus offer:Â $125 Amazon.com gift card upon approval (if you have an eligible Amazon Prime membership) Purchase intro APR:Â N/A Balance transfer intro APR: N/A Foreign transaction fee:Â None Rewards: If you have an eligible Amazon Prime membership:Â 5% back or an extra 90 days interest free on purchases at Amazon Business, AWS, Amazon.com and Whole Foods Market If you do not have an eligible Amazon Prime membership: 3% back or an extra 60 days interest free on purchases at Amazon Business, AWS, Amazon.com and Whole Foods Market 2% back on purchases at U.S. restaurants, U.S. gas stations, and on wireless telephone services purchased directly from U.S. service providers 1% back on other purchases Notable perks & benefits: Employee cards available Employee purchase control withÂ multi-user accounts, shared payment methods, approval workflows, and spending limits Purchase protection, extended warranty, and travel coverage Access to Amex Offers More card details (click to expand) Hide

This one’s a little more niche. But if you find yourself buying supplies and random pet-related doodads on Amazon frequently, you can get a lot of value out of the Amazon Business Prime American Express Card.

If you have a Prime membership, you’ll earn a whopping 5 percent back on purchases made at Amazon.com, Amazon Business, AWS, and Whole Foods Market — or an extra 90 days interest-free grace period for purchases made at those places. Even if you’re not a Prime member, you’ll get 3 percent or 60 days, respectively. You’ll need to spend around $6,000 to recoup the cost of a $119 Prime membership with points alone, but that’s without factoring in money saved through Prime’s programs (shipping, deals, etc).

Personal Loans

If you need more money than you can safely put on a credit card, or need longer to pay it off, you should consider getting a personal loan that can cover business expenses.

There are some disadvantages to taking this route, namely that you’re on the hook rather than your business, but if your credit is good, it’s not the worst option out there.

Recommended Option: Lending Club Personal Loans

	Review Check Rate

Time in business: N/A Business revenue: N/A Personal credit score: 600 Credit history: 3 years Borrower requirements for personal loans (click to expand) Hide

Lending Club is a good option for individuals who may not have the strongest credit, but have a good debt-to-income ratio. The borrowing range is fairly narrow at $1k to $40k, but when you’re just starting out, you don’t want to go too deeply into debt anyway. You’ll have three-to-five years to pay it off, which makes it fairly manageable.

Recommended Option: Lendio

	Review Visit Site

Time in business: 6 months Business revenue: $10,000 per month Personal credit score: 550 Borrower requirements (click to expand) Hide

If you’re just entering the alternative loan market for the first time, it can be pretty overwhelming. Lendio takes some of that burden off of you by allowing you to effectively apply to their whole network of lenders with one application.

Need more options? Check out our feature on startup loans.

Create Contracts

If you’ve just been watching your friends’ pets, you’ve probably had an informal agreement about the services you’d provide and the expectations of safety and liability involved. And that was probably enough.

When you’re dealing with strangers in a professional capacity, however, it’s smart to formalize these elements in a contract. This can save you a lot of headaches, if not legal troubles, down the road. You’ll want to include critical information about the pet (when and what they eat, how they are with strangers, pertinent medical history, etc.), what’s included in your services, and the client’s expectations for how their home will be treated under your care (if applicable). You’ll also want to include your fees and rates.

If you can, have a lawyer look it over to make sure it checks out legally.

Market Your Business

Getting the word out is always one of the most challenging parts of getting a business off the ground. The easiest place to start is through word of mouth. Are you already looking after the pets of a family or two? Let them know you’re looking to take on more clients, along with your friends, family, and social contacts.

At some point, you’ll probably want to expand outside the reach of your current contacts, which means advertising. It doesn’t have to be fancy. You can post flyers on bulletin boards and leave business cards in places trafficked by pet owners. Online classified sites like Craigslist can also cover a large audience in your area.

Bolster Your Web Presence

When it comes to promoting small business, the internet is one of those things that’s easy to both over- and underestimate. On the one hand, simply buying an ad and hoping for the best likely won’t yield amazing results. On the other, you do need an internet strategy to grow your business.

It doesn’t have to be fancy, but you’ll probably want a website that details your basic services and contact information. Don’t overthink it. There are a lot of great tools available that can help youÂ build a website.

Remember, too, that social media isn’t just for sharing pictures of your dinner with your friends. You can use to communicate with customers, make engaging content that makes them keep your brand in mind, and announce special deals and service changes.

Final Thoughts

Hopefully, everything we covered doesn’t look too intimidating. If you’re good with animals and don’t mind turning that love into a source of revenue, you can get a pet-sitting business up and running in no time!

Having second thoughts about pet-sitting but are still looking to open a business? Check out our other beginners’ guides.

The post How To Start A Pet Sitting Business: The Complete Guide appeared first on Merchant Maverick.

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What Is A Home Equity Loan?

Equity Loans VS HELOCs

Equity Loans VS Business Loans

When Should Merchants Use A Home Equity Loan?

Home Equity Loans For Business: Pros & Cons

Alternatives To Home Equity Loans

Business Lines Of Credit

Invoice Financing