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Old 10-12-2011, 10:54 AM
mcw615 mcw615 is offline
LawnSite Senior Member
 
Join Date: Jun 2009
Location: Virginia
Posts: 473
Project In House Financing

We focus a lot on design/build and as well as maintenance contracting.

I love compounding interest income, let your money work for you--not always work for your money. I am wanting to adventure into more investing opportunities, and why not do so within your own means.

One thing I am considering is offering in house financing for some of the small maybe medium sized projects we do and see how it goes. This will do two things, possibly lead to more sales (increased revenue) and lead to compounding interest income, thus more revenue. The ultimate thing is, no, not completely straight liquid assets. We generally have about a 22% profit margin. I am considering only offering financing for up to $5,000, for now and see how it goes. For a $5,000 project, my liquid asset of what I am actually investing is $3,900 before profit, but I am financing $5,000.

I am just looking for general advice on this idea, if anyone has any experience in this or general input. Very preliminary at this point. MANY thanks. For a $5,000.00 your are looking right at $500.00 in interest, that's an additional 10% in profit. What CD is out there that you can get 10% PLUS lead to an extra sale or two?

Ex. Loan Amount ($5,000.00) Interest (18%) Term (12) months

PMT Pri. PD. Int. PD. Total Int. YTD BL
Nov. 2011 $458.40 $383.40 $75.00 $75.00 $4,616.60
Dec. 2011 $458.40 $389.15 $69.25 $144.25 $4,227.45
Jan. 2012 $458.40 $394.99 $63.41 $207.66 $3,832.46
Feb. 2012 $458.40 $400.91 $57.49 $265.15 $3,431.55
Mar. 2012 $458.40 $406.93 $51.47 $316.62 $3,024.62
April 2012 $458.40 $413.03 $45.37 $361.99 $2,611.59
May 2012 $458.40 $419.23 $39.17 $401.16 $2,192.36
June 2012 $458.40 $425.51 $32.89 $434.05 $1,766.85
July 2012 $458.40 $431.90 $26.50 $460.55 $1,334.95
Aug. 2012 $458.40 $438.38 $20.02 $480.58 $896.58
Sept. 2012 $458.40 $444.95 $13.45 $494.03 $451.63
Oct. 2012 $458.40 $451.63 $6.77 $500.80 $0.00

Last edited by mcw615; 10-12-2011 at 11:02 AM.
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