The Finance is nothing but all the financial resources needed to perform an activity when it comes to economic activity, the most important is that usually is from amounts taken as a loan so you can complement your own resources.

You can be hired in and outside the country through credits, loans or generating a credit title or other document payable in a long term. This finance can be classified in two types:

Internal finance: is the one that comes from the company's resources such as: partner's investments, the creation of new liabilities and stock-in trade as well, this means, utilities retention, which is receiving in-stock merchandise, acquired merchandise and this payment's date.

External Finance: Is the one generated when working with your own resources is not possible, it means when the funds generated through your normal operations plus inputs made by owners or partners cannot support the outlays to keep the normal functionality of the company in this case is needed to appeal to third parties such as: loans and financial factoring.

The main way to obtain finance is credit, which is the money received so we can afford any involved hardship and the company compromises to pay in a short-term period, with a fixed or variable interest rate with or without partial payments and offering a collateral that will satisfy the lender so that way in the event the incumbent cannot pay off the loan the collateral will cover the current debt.

Generally the short-term finance is cheaper than the long-term finance but is riskier due to the fact the requirement level, short-term payments will be higher than long-term payments, this means before acquiring any type of loan the company must review all the possible options when it comes to positive impact in the company and the actions taken or involved in the process.

Most likely this need to get this short-term funds will be used to cover the finance created by your in-stock inventory and account receivable, on the other hand the long-term loan will be used to cover acquisition or renewal of the equipment and also any unbalanced short-term loan but also to increase the stock you currently have in your inventory keeping in mind that long-term finance allows to cover long-term investment.

There are two types of short-term finance:

With collateral: is the one for which the lender requests collateral. the collateral or guaranteed becomes tangible assets such as: accounts receivable and stocks therefore the lender will acquire partial participation through a contract so that way the lender will not lose in case the company declares bankruptcy There are two types of short-term financing:

The one, for which the lender requires collateral. The collateral term or guarantee takes the form of tangible assets such as accounts receivable and inventory, on which the lender acquires a warranty on Article by legalizing a contract (agreement); between both parties (lender-borrower).
No guarantee: It consists of funds obtained by the company without compromising certain fixed assets as collateral Bank credit.

Is a type of short-term financing that companies obtain through banks which establish functional relationships. Importance.

Bank credit is one of the ways most used by companies today to obtain necessary financing. Almost all are commercial banks that handle the checking accounts of the company and have the highest capacity loan in accordance with applicable laws and banking arrangements at present and provide most of the services that the company requires.

As the company goes frequently to the commercial bank for short-term resources, choosing one in particular deserves careful consideration. The company must be certain that the bank will help the company to meet the needs of short-term cash it has and when it is presented.

• If the bank is flexible in its conditions, will be more likely to negotiate a loan that meets the needs of the company, which places it in the best environment to operate and profit.

• Allows organizations to stabilize in case of trouble with respect to capital.

Using forms.

When the company is present with the bank loan officer should be able to negotiate. You must give the impression that it is competent.

If you go looking for a loan, it must be submitted with the official with the following data:
a) The purpose of the loan.
b) The amount required.
c) A defined payment plan.
d) Evidence of the solvency of the company.
e) A layout plan of how well the company expects to develop in the future and achieve a situation that allows you to repay the loan.
f) A list of guarantees and collateral that the company is willing to offer, if any and necessary. The interest cost varies depending on the method to be followed to calculate. The company must always know how the bank calculates the real interest on the loan.

After the bank analyze these requirements, it will decide whether to grant credit.
Line of credit. Credit Line always means money in the bank for a period agreed in advance. Importance. It is important as the bank agrees to lend to the company up to a maximum amount, and within a certain period, upon request.
Although usually not a legal obligation between the two sides, the credit line is almost always respected by the bank and avoids negotiating a new loan. Whenever the company needs to have resources.
* It is an effective "available" with which the company has. Using forms.
The bank lends the company a maximum amount of money for a certain period. Once the negotiation is done, the company has more than inform the bank of his desire to "dispose" of such amount, sign a document stating that the company will have that amount, and the bank automatically transfers funds to the account checking.
The Cost of Credit Line usually set during the original negotiation, but usually fluctuates with the prime rate. Each time the company has a line of credit pays the agreed interest.
At the end of the period originally negotiated, the line ceases to exist and the parties will have to negotiate another if they wish.