Small and medium-sized enterprises (SMEs) rely on fast funding for survival and growth. A 2024 Report on Employer Firms in the U.S. found that businesses sought funding for three main reasons: operating expenses, expansion, and opportunity 2.
Yet in the Middle East and North Africa (MENA), they face staggering barriers to funding, receiving just 7% of total bank lending—the lowest in the world 3. Banks view SMEs as higher-risk and less profitable.
A study by the Shell Foundation and Citi Foundation revealed that over half of SMEs that apply for bank funding are denied, primarily due to short business histories (typically requiring 5-10 years), insufficient collateral (120%-150% of the finance value), and the absence of suitable guarantors 4.
Assessing and funding SME finance requires more time and resources, leading banks to prioritize corporates. For the few SMEs that secure finance, the interest rates range from 10%-14%, and the money often takes several months to arrive 4.
Delayed funding leaves SMEs vulnerable to a host of hidden costs, from lost opportunities to financial distress and, in Bkam’s case, total collapse.
Each year, the month of May marks a significant occasion in the world of insurance and financial security. It is known as Disability Insurance Awareness Month. This observance is dedicated to educating individuals about the importance of disability insurance, promoting financial preparedness, and fostering a greater understanding of the potential risks that can disrupt one’s income. In this blog, we will delve into what Disability Insurance Awareness Month is, why it matters, and the key takeaways you should consider.
What is Disability Insurance Awareness Month?
Disability Insurance Awareness Month, often referred to as DIAM, is an annual awareness campaign in May. The campaign aims to emphasize the significance of disability insurance in protecting your financial well-being. It serves as a reminder to individuals about the potential risks of disability and the critical role disability insurance plays in safeguarding their income and providing peace of mind.
Promoting Financial Preparedness: Disability Insurance Awareness Month encourages individuals to assess their financial preparedness for unforeseen events. Many people underestimate the risk of disability and its potential impact on their lives. By increasing awareness, the campaign encourages people to plan for the unexpected.
Reality of Disabilities: As you know that the disabilities can happen to anyone at any time. Whether caused by accidents, illnesses, or other factors, disabilities can lead to a loss of income and additional expenses related to medical care and rehabilitation. Awareness campaigns shed light on the reality of disabilities and the need for protection.
Preventing Financial Crisis: Without disability insurance, individuals may be forced to rely on their savings, exhaust emergency funds and face severe financial hardship when dealing with a disability. Raising awareness about disability insurance helps individuals avoid financial crises during such challenging times.
Key Takeaways
Assess Your Risk: Disability can affect anyone, regardless of age or occupation. Assess your risk by understanding the potential impact of a disability on your income and financial stability.
Explore Disability Insurance Options: Research the different types of disability insurance policies available, including short-term and long-term coverage. Consult with insurance professionals to find the right policy for your specific needs.
Understand Policy Terms: When considering a disability insurance policy, be sure to understand the terms, including the elimination period, benefit amount, and benefit period. These terms affect how your policy functions in the event of a disability.
Review Your Coverage: If you already have disability insurance, take time to review your coverage. Ensure that it aligns with your current financial situation and needs.
Create an Emergency Fund: In addition to disability insurance, it’s essential to have an emergency fund to cover immediate expenses in case of a disability. This fund can help bridge the gap between the elimination period and when your benefits kick in.
Raise Awareness: Share information about Disability Insurance Awareness Month with family, friends, and colleagues. Help spread the word about the importance of disability insurance and financial preparedness.
Final Words
Disability Insurance Awareness Month serves as a crucial reminder that disabilities can impact anyone at any time, potentially jeopardizing their income and financial stability. By raising awareness about disability insurance and the importance of being financially prepared for such circumstances, individuals can take steps to secure their future and protect their livelihoods. Take advantage of this awareness month to assess your risk, explore insurance options, and ensure that you and your loved ones are adequately protected.
Over 6 million borrowers are in default on their federal student loans. Before the pandemic, these borrowers faced forced seizures of their wages and antipoverty benefits, including through wage garnishment, Social Security benefits offset, and seizure of their federal tax refunds–including the Child Tax Credit and Earned Income Tax Credit. Additionally, default damaged their credit scores, rendered them ineligible for student aid to return to school and finish their degrees, and ultimately limited their economic mobility. For many, getting out of default was overly complicated or had become impossible because they had already exhausted their limited options for removing their loans from default.
However, the Fresh Start program has temporarily protected borrowers from the harsh consequences of default and provided a streamlined path for borrowers to have their loans removed from default. The opportunity to get out of default through Fresh Start and the protections from collection and other consequences of default the program offers will end on September 30, 2024. As the program winds down, borrowers should be aware of the changes ahead and the actions they can take to remove their loans from default before the program expires.
Key Benefits of the Fresh Start Program
Borrowers have until September 30, 2024, to access these important benefits of the Fresh Start program:
Removal of Loans from Default: Borrowers who have eligible loans in default can get their loans out of default quickly and easily before the Fresh Start deadline and so avoid the negative consequences of default that may otherwise resume as soon as October. Upon removal from default, the borrower will be eligible for access to affordable repayment plans that could reduce their monthly payments to as low as $0, based on their income, as well as other relief options such as forbearances.
Access to Financial Aid: Before the Fresh Start program, borrowers in default were not able to access financial aid to continue their education. Under the Fresh Start program, these borrowers can apply for financial aid, and their loans are automatically removed from default upon receiving new financial aid. This option will no longer be available after September 30.
Pause on Collection: Defaulted borrowers are protected from collection until the program expires on September 30. This protection will expire, and collection will resume if the borrower does not request removal of loans from default on or before that date.
Negative Credit Reporting: Until September 30, Fresh Start-eligible borrowers will be protected from negative credit reporting. However, negative credit reporting will resume if the defaulted loan is not removed from default at the end of the Fresh Start period.
How to Request a Fresh Start
Enrollment in Fresh Start is easy and can be done over the phone by contacting the Department’s Default Resolution Group at 1-800-621-3115, online at myeddebt.ed.gov, or by mail at P.O. Boz 5609, Greenville, TX 75403.
After September 30, borrowers will no longer be able to use Fresh Start to get out of default. Please visit our Fresh Start page for more information about Fresh Start enrollment.
Loans That Are Eligible for Fresh Start
Most defaulted federal student loans are eligible for Fresh Start benefits, including defaulted:
Direct Loans,
Perkins loans held by the Department of Education, and
most Federal Family Education Loan (FFEL) loans (held by the Department of Education and commercial lenders) that defaulted before the pandemic.
Please visit our Fresh Start page for a list of loans that are not covered under the Fresh Start program.
Will collection start after Fresh Start ends?
Loans that are not removed from default by September 30 may be subject to default collection. The Department is yet to announce its plans for default collection after the Fresh Start period expires, but in the past, default collection has included negative credit reporting, collection notices, wage and Social Security benefit garnishment, seizure of tax refunds, and sometimes collection lawsuits.
Will negative credit reporting resume after September 30th?
Due to the Fair Credit Reporting Act, loans that have been delinquent for more than seven years should not appear on a borrower’s credit report. The Department instructed the credit reporting agencies and guaranty agencies to delete the tradelines of these loans. Therefore, loans in delinquency for greater than seven years should not appear on a borrower’s credit report and should not be reported after the Fresh Start period ends on September 30.
However, negative credit reporting will resume on loans that have been delinquent for less than seven years if the loans are not removed from default by the end of the Fresh Start period. The defaulted loan will be reported as in collection with the original date of delinquency.
If I use Fresh Start to get out of default, can I apply for rehabilitation in the future?
Normally, you can rehabilitate a loan only one time. But Fresh Start will not count as your one chance at rehabilitating your loan(s). So, if you use Fresh Start to get out of default, you will still have the option to rehabilitate if you redefault in the future – provided you have not done so in the past.
Can I apply for Income-Driven Repayment (IDR) when I request a Fresh Start?
If you request Fresh Start to get out of default by September 30, you will be eligible to apply for an IDR plan, which reduces your monthly payment based on your income. Unfortunately, online IDR applications have been temporarily paused, but you may still apply for IDR using a PDF or paper application. Borrowers have been told to expect delays in IDR application processing, but you should be placed in a forbearance (meaning you do not have to make payments) until your IDR application is processed –contact your servicer to request a “processing forbearance” if they do not put you in one.
If your loan is removed from default and you do not enroll in IDR, your loan will be placed on the standard repayment plan, which may not be affordable to you; if it is not affordable, you can request to switch to IDR.
Borrowers who do not use Fresh Start to get out of default by September 30 will remain in default and will not be eligible for IDR. They will have to rehabilitate or consolidate to get out of default and apply for IDR, which is a more complicated process than enrolling in Fresh Start. This is why borrowers should consider getting out of default with Fresh Start while the program is still available.
By acting now—whether through enrolling in Fresh Start or applying for IDR after enrollment into Fresh Start, borrowers can enter repayment, avoid the harsh consequences of default, and set themselves on a more stable financial path.
Everyone has different reasons for buying insurance. But at the heart of the decision to purchase insurance is financial security for yourself and those you care about. Find out why life insurance is important and who needs it.
“Andrew’s exceptional track record in driving business strategy and transformation, combined with his extensive leadership experience in the mortgage industry, makes him an invaluable addition to our board,” Jay Bray, chairman and CEO of Mr. Cooper Group, said in a Press release. “We are pleased to welcome him as we advance our strategic vision and continue to build an industry-leading homeownership experience for our customers.”
Meanwhile, Flagstar Financial, which sold its mortgage business to Mr. Cooper, announced the appointment of Brian Callanan to its board.
Callanan, senior managing director and general counsel at Liberty Strategic Capital, brings substantial expertise in financial regulation, regulatory compliance, and financial technology.
Before joining Liberty, Callanan served as general counsel at the US Department of the Treasury, where he led a team of 2,000 lawyers and played a pivotal role in key initiatives, including economic rescue programs during the COVID-19 pandemic, the implementation of economic sanctions, and tax reform.
As we wrap up another month, it’s time to view VIAINVEST’s performance highlights for November 2024.
Key Statistics for November 2024 • Loans Published: €9,508,492 • Loans Funded: €9,431,652 • Interest Paid to Investors: €345,310 • Interest Rate: Up to 13%
While November marked a slightly quieter month compared to prior months, figures reached €9.5M in investments published and €9.4M were successfully funded.
As we head into the final month of 2024, our focus remains on expanding investment offers and ensuring a seamless experience for our investor community.
Life is unpredictable, and disabling illnesses and injuries occur without warning. The odds of one affecting you may be higher than you think. Experts estimate over 25% of people in their 20s will experience a disability before retirement.
In the event of a serious illness or injury, the financial impact could be significant, with the loss of income from being unable to work in your specialty. Group-sponsored plans often fail to provide adequate coverage, having limited definitions of disability and payout offsets. Solve these issues by investing in an individual disability insurance policy.
Benefits of Individual Disability Insurance
Disability insurance helps protect you against income loss by providing monthly benefit payouts if you’re unable to work due to a severe illness or injury. In addition to safeguarding your financial stability, individual coverage offers several other benefits:
It’s Yours
When you buy an individual policy, it’s yours. As the owner, you retain control over the customization of your policy and the carrier you choose. You also decide the income benefits you need — as long as you qualify based on income and the insurer’s participation and limits — and the policy features you want.
Conversely, with employer-paid plans, the organization makes the choices for you. They select the insurance company and how much coverage to buy. Your employer can also cancel the plan or amend its terms without your consent.
It’s Portable
You lose benefits under those group plans if you change employers. Individual disability insurance is portable, so you can maintain coverage as you progress throughout your career even if your health changes.
It’s Affordable
Disability insurance is most cost-effective when you apply earlier in your career. Obtaining disability insurance during residency often translates into lower premiums across the life of the policy. Because you can lock in those prices if you make prompt payments and don’t change the plan’s terms, you save money long-term.
No Taxes and Other Offsets
Another advantage of individual disability insurance for residents is that your payouts are not subject to income tax since you pay the premiums. If the employer pays for your group plan, you will be taxed on the benefit amounts you receive under the coverage while you’re disabled.
Employer-sponsored insurance generally offset your monthly benefit amounts by other income you receive while disabled. Within group policies, you will find a section with a list of these ‘deductible sources of income’, or ‘other sources of income’, which typically includes other employment income you receive while disabled, Workers’ Compensation, Social Security, salary continuation and more. Individual disability insurance will not have any offset provisions, meaning you could collect your full benefit amount even if you are collecting from Social Security or any other source of income while disabled. Group benefits and Individual benefits will typically not affect one another, meaning you could collect on both while disabled.
Options May Exist for Those With Preexisting Medical Conditions
Residents with preexisting medical conditions often wonder if they can qualify for disability insurance since many policies are fully underwritten and require a comprehensive medical review. The good news is that having health concerns doesn’t automatically disqualify you. Insurers can sometimes offer modified protection or implement an exclusion for a specific condition without completely denying coverage.
Another option, available exclusively for residents and fellows at a number of institutions, is Guaranteed Standard Issue (GSI) insurance. Applying for fully underwritten policies and receiving a modified offer or being declined coverage can affect your eligibility for GSI. It’s beneficial to explore your options with an independent broker as they will be able to help you find the best fit.
Best Types of Disability Insurance for Resident Physicians
Coverage works best when you can tailor the policy to your unique needs, so finding customizable disability insurance for residents is the first step. Today’s top disability insurance companies offer many ways to create bespoke protection strategies through policy enhancements called riders. Two of these amendments are crucial to comprehensive security — True Own Occupation and Non-Cancelable and Guaranteed Renewable.
True Own Occupation Language
Every insurance policy includes a definition for total disability that determines how and when you qualify for benefit payout. The language the company uses in this clause is especially vital for physicians due to the potential impact of a disability on the physical demands of their specialty. It is recommended that physicians obtain True Own Occupation definitions of total disability. This would ensure the company pays out your benefit if you cannot perform the duties of your specialty, even if you decide to be gainfully employed in another occupation. For example, a surgeon who develops tremors can no longer perform procedures but can earn an income in teaching without jeopardizing their disability payouts.
Under group policy language, that physician may not qualify for benefits since they can be gainful employed in another occupation. It is important to read through your employer’s long-term disability Certificate in order to determine the definition of total disability, however it will likely not be True Own Occupation.
Non-cancelable language prevents the carrier from increasing policy premiums as long as you continue timely payments. Guaranteed renewable does not allow the company to cancel the plan or change policy provisions and definitions when you maintain current premium payments. These features help ensure continued protection and premium stability.
Other Popular Policy Enhancements to Consider
Aside from the riders above, carriers offer multiple other policy riders to customize your coverage and protect your financial stability. Ways to keep pace with your earnings and inflation are among the most popular. Options include:
Future increase riders: These endorsements allow you to increase your monthly benefit payout up to the allowable policy maximum, even if your health changes.
Automatic increase benefit rider: Adding an automatic benefit increase rider is another solution for ensuring your monthly payout aligns with your income potential. These riders automatically increase the monthly benefit yearly for a specified time frame, with premiums rising proportionately.
Cost of living adjustment riders: Known as COLAs, cost of living adjustment riders allow for annual base benefit increases while you’re disabled. You must collect benefits for a minimum of 12 months before a COLA applies, and each carrier has different adjustment options to choose from.
Additional riders vary by carrier and are worth exploring to create the best solution for your needs.
Trust DrDisabilityQuotes.com to Help You Find the Right Medical Resident Disability Insurance
DrDisabilityQuotes.com is a truly independent insurance partner offering a range of disability insurance for medical residents from today’s most respected carriers. Since we don’t work directly for any insurance company, we provide unbiased guidance on your options. We’ll gather quotes from our network and review them with you so you can confidently pursue the best solution for your needs.
Homespire Mortgage is excited to announce the opening of our newest branch in Frisco, TX, as we expand our footprint in the thriving North Texas region! Led by an exceptional team of mortgage professionals, the Frisco branch is poised to deliver on our promise of providing a world-class mortgage experience that clients and referral partners can count on time and time again.
Meet the Frisco Team:
Together, this dynamic team brings over 60 years of combined experience in the mortgage industry. With deep roots in the Frisco community and a commitment to service, they’re ready to guide homebuyers through every step of the mortgage process with confidence and ease.
“At Homespire Mortgage, we take the time to ensure our clients and partners feel confident, informed, and supported throughout the process ,” said Torrey Pinkerton, Branch Manager. “We’re proud to offer a personalized, white-glove service designed to create lifelong customers and empower clients to confidently navigate the home-buying journey. This isn’t just about securing a loan; it’s about building trust and fostering relationships for life.”
Dedicated to a personalized approach to mortgage solutions, the Frisco branch specializes in:
First-Time Homebuyers – Helping new buyers achieve the dream of homeownership with tailored guidance and support.
Veterans – Offering specialized VA loan expertise to honor those who’ve served.
Renovation Loans – Helping homeowners bring their visions to life with expert renovation financing options.
With a locally-operated presence in North Texas for over 14 years, the Frisco branch is deeply committed to serving the community. Whether it’s finding the right loan product from a wide range of options or offering competitive pricing, the team takes pride in delivering results that exceed expectations.
Homespire Mortgage is proud to expand its mission to serve the Frisco community, ensuring that families and individuals across North Texas have access to expert guidance and innovative mortgage solutions.
Visit Us in Frisco! If you’re ready to take the next step in your home-buying journey, stop by our new location in Frisco, TX, or connect with our team today. Let us show you the Homespire difference! To learn more about the Frisco branch and how we can assist you, visit homespiremortgage.com/frisco.
The total number of mortgage completions by people aged 56+ has dropped by 52% since 2005 to 84,576 last year, the Equity Release Council (ERC) reveals.
ERC says: “At a time of significant product innovation […] the unmet demand will need to be addressed as the market recovers.”
Increasing longevity means that the number of people aged 56+ has grown by 31% since 2005 to almost 21m. However, mortgage approvals have followed a different trajectory with fewer older borrowers taking out products.
In 2005, there was one loan completion for every 91 people aged 56 and over in the UK, but the ratio fell to one completion per 246 people in 2023.
During the post credit-crunch recovery over the last decade, the council’s analysis shows the number of people taking out lifetime mortgages has grown across every UK region except the North East, which itself saw significant growth up until 2022.
Of the 12 regions, eight registered double-digit growth between 2014 and 2023.
Regions that recorded the strongest growth rates included Wales, which saw growth of 44%, East Midlands by 23% and the East of England by 21%.
While lending has been subdued this year, ERC says product availability in the equity release market has rebounded as 2024 has progressed.
The council’s analysis of data from AdviseWise shows there were 212 more product launches than withdrawals between August and October.
Rates have also stabilised, with average APRs for new lifetime mortgage products reaching a year-low of 6.31% in September 2024, an improvement on the 7%-plus averages seen last year.
Despite fluctuating economic conditions, loan-to-value (LTV) ratios for lifetime mortgages at age 70 have edged back towards pre-pandemic levels.
ERC chair David Burrowes says: “While lending volumes may be subdued for now, there is no denying the giant strides which have been made in equity release product design and distribution, advice and public perceptions in the post-regulation era.”
“We know the current recovery will be a gradual process with no overnight return to the £6bn+ market of recent years. At the same time, the potential is there to go far beyond this high watermark in the future, and it’s important we turn this reset period into a positive.
“Property wealth has long been one of the most significant assets available to UK households. Advances in lifetime mortgage product design have made it significantly more attractive to access and are likely to be seen in years to come as a major milestone in bridging the gap between residential homeowner mortgages and the later life market.
“The pause in growth provides a chance to focus on the next steps needed to create the sustainable later life mortgage market of the future which our ageing population sorely needs. In a climate of growing pension challenges, property wealth will play a crucial role in bridging the gap between aspirations and affordability in later life.
“The council is focused on working with industry, regulators, and policymakers to ensure consumers receive the best advice and make informed, confident decisions about their financial futures.”
Whether you’re a seasoned investor or a novice entrepreneur, commercial real estate rates will always be a focal point guiding your investment decisions.
This article will simplify commercial mortgage rates, shedding light on key points of consideration and practical strategies to optimize your investments.
Current commercial real estate rates.
As of November 2024, we’re seeing rates that range from about 5% to 15%, depending on the asset type and specific circumstances of the loan.
Key elements of commercial real estate rates.
Commercial mortgage rates are determined based on a combination of market factors, property-specific factors, the stance of the lender and borrower, and the loan structure.
Market conditions
Overall market conditions play a role in determining commercial real estate rates.
Economic factors
Commercial mortgage rates are influenced by broader economic conditions, such as inflation, economic growth, and the overall health of the economy.
Interest rates
The general level of interest rates in the economy—often indicated by benchmark rates such as the prime rate, LIBOR (London Interbank Offered Rate), or the U.S. Treasury yields—can impact the rates offered by lenders.
It’s important for borrowers to carefully consider these factors and work with lenders to secure the most favorable terms, based on their financial situation and the specific details of the commercial property transaction.
Property-specific factors
Property type and location will also impact your final rate.
Property type
Different types of commercial properties may have varying risk profiles, affecting the interest rates. For example, rates for office spaces might differ from those for industrial properties.
Location
The location of the property can impact rates. Properties in high-demand or economically thriving areas may have lower rates compared to those in less desirable locations.
Borrower’s creditworthiness
Your creditworthiness and general financial situation will impact your rate.
Credit score
The creditworthiness of the borrower is a crucial factor. Lenders assess the borrower’s credit history, financial stability, and debt-to-income ratio to determine the risk associated with the loan.
Business financials
Lenders may also evaluate the financial health and performance of the business occupying the commercial property.
Loan-to-value (LTV) ratio
The loan-to-value (LTV) ratio is the percentage of the property’s value that you’re looking to finance with the loan.
If you’re looking for a high LTV ratio, it means you’re seeking to borrow a larger portion of the property’s value, which could present a higher risk to the lender. Because of this increased risk, you may find that higher LTV ratios are typically accompanied by higher commercial mortgage rates.
Loan term and amortization period
Rates will also vary based on the length of the loan and the repayment schedule.
Loan term
The length of the loan term can influence the interest rate. Shorter-term loans may have lower rates but higher monthly payments, while longer-term loans might have slightly higher rates but lower monthly payments.
Amortization period
The time it takes to repay the loan (i.e. the amortization period) can also impact the interest rate. A longer amortization period may result in a higher overall interest cost.
Lender’s policies and competition
Every lender’s rates are impacted by its investment portfolio and competition.
Lender policies
Each lender may have its own criteria and policies, impacting the rates they offer. Some lenders may specialize in certain property types or industries.
Competition
The competitive landscape among lenders can affect rates. Borrowers may get more favorable rates if lenders are competing for their business.
Fixed vs. variable rates
Commercial mortgage rates can be fixed (i.e. unchanging throughout the loan term) or variable (i.e. fluctuating based on market conditions). Fixed rates provide stability, while variable rates may offer initial cost savings but involve more risk. Borrowers should choose the type of rate that aligns with their financial goals and risk tolerance.
SBA 504 loan rates: An option for small businesses.
For entrepreneurs seeking to finance major fixed assets like real estate or equipment, the Small Business Administration’s (SBA) 504 loan can be a great option. The SBA 504 loan is known for its competitive and predictable rates, making it a popular choice among borrowers.
Fixed-rate loans under this program are tied to U.S. Treasury bonds, which typically carry some of the market’s best rates. The rates for SBA 504 loans are set when the SBA sells the bond to fund the loan. This means borrowers can lock in a low, long-term fixed rate, protecting their business from future interest rate increases. The 10-year Treasury rate as of November 2024 is around 4.35%.
It’s also essential to understand that SBA 504 loan rates include two different loans—one from a Certified Development Company (CDC) and one from a bank or other financial institution. The CDC loan, which covers up to 40% of the total project cost, has a fixed interest rate. In contrast, the bank loan, covering 50% or more of the total project cost, can have a variable or fixed rate, depending on the specifics of the agreement.
Remember, despite these attractive rates, it’s important to consider all aspects of your financial situation and business goals before deciding on a loan product. Consult with financial professionals to make sure you’re making the best choice for your business.
Wrapping up
By familiarizing yourself with the primary elements that influence these rates, and keeping an eye on current market conditions, you’re already on the right path.
Whether you’re considering a traditional commercial mortgage or exploring options like the SBA 504 loan, remember that the best choice will depend on your unique financial situation and business goals.
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Information provided on this blog is for educational purposes only, and is not intended to be business, legal, tax, or accounting advice. The views and opinions expressed in this blog are those of the authors and do not necessarily reflect the official policy or position of Lendio. While Lendio strives to keep its content up-to-date, it is only accurate as of the date posted. Offers or trends may expire, or may no longer be relevant.
