How Do Hotels Get Funding?
Starting or expanding a hotel business can be lucrative and profitable, but it often requires huge investments. Whether developing a new property, renovating an existing hotel, or requiring working capital, securing funding is one of the first and most critical steps. However, finding the right financing solution for your hotel project can be challenging — with various options, each suited to different needs and situations. To Get Funding For Your Hotel: Call Now Hotel funding can be utilized to fulfil the following requirements: In this blog, we’ll explore the various ways hotels can get funding, from traditional bank loans to more creative financing methods. Top Five Ways Through Hotels Get Funding 1. Traditional Bank Loans This is one of the most common ways to raise funding for hotels & resorts in India. The bank offers loans for the construction of a hotel to working capital requirements and loans to renovate an existing hotel. Banking finance suits the requirements of a hotel promoter like offering moratorium periods till the hotel becomes operational. Advantages: Disadvantages: 2. Non-Banking Financing (NBFC Funding) These days a lot of NBFCs offer loans for constructing or developing a hotel and resorts. NBFC processes loan applications faster than banks and requires less paperwork. These loans can be repayable in shorter to longer durations as per the borrower’s requirements. Also, the NBFC companies offer small to larger amounts of loans that are sufficient to meet the requirements of every borrower Advantages: Disadvantages: 3. Private Equity Funds and Venture Capital Private equity (PE) firms and venture capitalists (VCs) are another way to secure funding, particularly for larger hotel projects or innovative hospitality concepts. These investors typically provide funding in exchange for equity or partial ownership of the hotel. VCs can typically invest in start-ups or early-stage companies that have high growth potential. In exchange for their investment, these firms or individuals may ask for a share in the hotel’s ownership, decision-making power, and a portion of the profits. Advantages: Disadvantages: 4. Real Estate Development Funds If you are building a new hotel, some real estate funds can also offer loans for the construction of a hotel or resort. A construction loan provides the funds needed to complete the construction of the hotel. Real estate funds will be disbursed in the parts of each stage of construction (such as foundation work, framing, etc.). Once the hotel is completed, the construction loan can often be refinanced into a permanent mortgage or long-term loan. Advantages: Disadvantages: 5. Promoter Funding If the promoters are financially sound enough, they can fund the entire expenditure of hotel development. This type of funding is typically provided by the promoters in the form of equity or debt, and it plays a crucial role in the early stages of a company’s growth, especially when external financing options (like bank loans or venture capital) are limited or unavailable. Advantages: Disadvantages: To Get Funding For Your Hotel : Apply Now Conclusion Getting funds for hotels is not a tough task these days where a hotelier can get funds through multiple channels from traditional banks to private-equity financing and availability of real estate funds for the construction of the hotel.
NPA Funding by NBFC Companies
In the finance industry, NPA accounts are a challenge for both lenders and borrowers. Lenders suffer as their money-generating assets stop performing, and borrowers suffer due to legal actions against their hard-earned properties, taken by lenders to recover their loans. Resolving the NPA account is crucial for both parties. But, specifically, the borrower must resolve the NPA account as fast as possible because the bank is trying to recover its money by selling collateral. For this, the bank will take legal action under the SARFASI Act. First, they will take symbolic possession of the property and then take physical possession. After that, go to an auction of the acquired property. So, resolving the NPA will be a top-notch necessity for the borrower. A lot of new-age NBFCs emerged in the last few years, which offer the takeover of NPA accounts from banks and give relief to NPA holders. These NBFCs offer a lot of benefits to borrowers as well as clean the bank’s balance sheet. NPA funding by NBFCs, provides the following benefits to the borrowers: These NBFC companies focus on clients who, despite NPA issues, manage to run their business, thereby securing the repayment of the new loan. Also, these companies offer some additional funding support to the NPA borrower to run the business more efficiently. Taking a loan from these companies not only removes the NPA status but also helps you in taking the business to new heights. Some of the features of the loan offered by these NBFC companies: A loan is offered to close the NPA account as well as for OTS Loans starting from fifty lakhs Facility of pre-payment Option of a moratorium period Tenor up to seven years
Personal Loan – Apply Online
Apply online for a personal loan from the comfort of your home or office and get sanctioned in a few hours. Money will be transferred to your designated bank account within 48 hours. Minimum documentation and fast approvals. Our loans can be availed for the following purposes: Benefits of our Loans How to Apply Online for a Personal Loan? Note: In some particular cases, our executive will call you for more clarity & information and collect all the documents online. Eligibility Criteria & Documentation for Availing an Online Personal Loan Eligibility Criteria Documents Required Click Here to Get Real Estate Funding
Loan for Real Estate Developers
Loan for Real Estate Developers in India We provide loans for real estate developers in India to meet their funding requirements for completing ongoing construction projects or for buying new land for an upcoming project. Loans are given to real estate developers for the following requirements: Eligibility Criteria for Loans to Developers and Builders Documents Required to Apply for Loan for Real Estate Developers
What are the Options for NPA?
1) Restructure of NPA Account Restructuring is a kind of rescheduling the repayment terms which gives additional time & new monthly EMI, so the Borrower can approach their bank to restructure their loan while remaining in the same bank. This option gives some additional years for repayment and borrowers can enjoy banking facilities. This is a kind of extension of a loan. This product completely depends upon banking policies & the bank will hold complete rights to decide to go for it or not. 2) Legal Solutions The client can approach their respective district or state DRT courts for taking time for repayment & put up a hold on bank proceedings. Generally, this can be done by depositing 20-25% of the amount out of the total outstanding amount. This way time is given for further repayment of the loan and the borrower gets relief from the proceedings of the bank if he fulfills his commitments in court. 3) One Time Settlement (OTS) If the borrower has arranged for money to repay his NPA loan, then he can approach the bank & ask for a one-time settlement This feature allows the borrower to enjoy some discount on the total outstanding of the loan. This is the best way to control or wipe off heavy dues on loan accounts. This feature encourages both client & bank to settle down NPA accounts as NPA accounts are also critical for the bank balance sheet. There are some institutes regulated by RBI, that can fund the entire or part of OTS amount as per requirement and repaying capacity. It’s better to hire a Finance Consultant for this as they are more knowledgeable & experienced on the subject. 4) Loan for NPA Account Taking a new loan will be the best option for NPA to clear off their NPA liabilities and to come out of the financial & legal disputes with the previous bank. Borrowers can apply for this new loan in some financial institutions that are especially providing loans for such NPA borrowers. Through this new loan, borrowers pay off bank dues in total & get out of this mess. Borrowers can arrange this new loan which is available in the market for the part or entire amount that can be financed. It is highly advisable to hire a Finance Consultant for this as they are more knowledgeable in the subject and they have ready connections for such kind of differential financing. Apply a Loan to clear off the NPA Account 5) Paying Loan through Sell of Collateral Borrowers can do this in two different ways. First selling of assets or property which is not mortgaged in the bank. This way, the borrower can arrange money without any interference from the bank & pay off his loan. Secondly, if an asset or property is mortgaged in the bank then the borrower can speak to the bank directly and tell them his intentions of paying off debt through this tool. And if the bank allows then he can approach the bank with the prospective buyer. This whole procedure can be achieved through a tripartite agreement between the bank, borrower, and buyer or any other way suggested by the bank.
How to Get Construction Project Funding?
Big projects require a large inflow of money in every phase of the project, which can be funded through the Promoter’s Equity, Sales Receivables, Construction Loans, the finance raised through company NCD, and Joint Ventures between builders or contractors. These funding tools can be infused at different stages of project development and in various proportions. In the early stages of the project, promoter equity can be infused and after that, receivables along with term loans can be sold. Similarly, a joint venture can be materialized before launching the project for seamless mobility of funds. For the advanced stages of the project, a last-mile funding option will suffice for the funding requirement. Now, let’s explore all these funding tools in detail: Click Here to take a finance/Construction Loan for your Real Estate Project
All About Construction Loans for Real Estate Projects
Construction loans play a vital role in real estate construction projects as they contribute a large part of the project cost which is necessary for the timely completion of the project and to win the trust of the buyers. Real Estate projects require the continuous flow of money which will be available through the resources that are pre-defined before the launching of the project. Real Estate projects require three main financial components or financial resources: Click Here to get Construction Loan Key Factors for Raising a Construction Loan There are key factors on which a lender considers a project for approving a construction loan like location, connectivity, pricing & and reputation of builders. These factors are fixed and cannot be altered but a few factors like promoter contribution, project sales receivables, and previous profile of the developer can be managed for raising a loan at better pricing. Moreover, the location and profile of the developers play the most important factor in raising a loan. Type of Projects for which Construction Loan is Given Construction loans can be given for raising following types of Projects: Conclusion Construction loans can be raised through NBFCs & fund houses that specifically set up a fund dedicated to investing only in real estate projects in the form of term loans & equity finance.
What Happens After NPA?
What is NPA? NPA refers to Non-Performing Asset. When a borrower stops paying the EMIs or interest in a particular loan account equivalent to or more than ninety days, then the bank declares that account as a non-performing asset (NPA). It also means that the loan account that stops generating profits to the bank is considered an NPA Account. What happens after NPA? When a loan account or borrower slips into the NPA, he faces multiple issues from the banks, like financial restrictions, immediate demand for the total loan outstanding, and a legal process to recover the loan from the borrower. All this makes the borrower unable to run the business properly and puts pressure on him to confront the bank financially and legally. A bank is a legal body with extensive legal support from the government to ease loan recovery. Banks are equipped with the SARFAESI Act, which enables them to sell or auction the borrower’s properties/assets in the event of default to recover their loan without any intervention from the courts. The following are the consequences that can be faced after the NPA. Click Here to Refinance Your NPA Account Financial Restrictions Legal Actions on the Borrower The following is the Notice issued by the Bank to the Borrower to recover NPA loans. Physical Possession of Collateral Properties Once notice 13(4) is served and upon expiry of its timeline, the bank tries to take physical possession of the properties. For doing so, the banks take legal permission from the local authority and also seek police protection to avoid any nuisance while taking physical possession. But, after taking possession, the borrower still claims the property within thirty days by submitting the total loan outstanding. Auction of Properties Once the physical possession is taken, the bank lists the property for online auction. DRT Court (Debt Recovery Tribunal) The bank can also take the matter to the DRT courts, which are specially meant for legal & financial issues. NCLT (National Company Law Tribunal) If the borrower is running the business under the Pvt Ltd or Ltd company, then the bank can also drag the matter into the NCLT court to dissolve the company and recover its loan Impact of NPA on Businesses and Individuals Impact on Businesses Impact on Individuals Know More About: Special Situation Finance
Best 3 Ways To Get OTS Funding
One-time settlement can be the best way to close one’s NPA account liability at a reduced value of the original outstanding amount by taking a waiver on interest & penalty levied by the bank. An OTS also helps banks to clean their balance sheet by reducing their NPA accounts, so it is largely supported by banks as well as other financial institutions. To Fund Your OTS Click Here A borrower can approach their bank to apply for OTS, and similarly, banks also offer time-to-time OTS schemes to their NPA accounts borrowers, and an OTS is approved by the bank for the borrower at a mutually favorable value. When an OTS is approved, it’s the borrower’s responsibility to service the OTS within the timeline. There are various ways to fund the OTS, like raising. OTS Funding OTS can be funded in many ways through debt finance, sale of collateral, and Private borrowing, depending upon the current income or business, collateral & most of the availability of such resources. 1. Debt Finance: OTS can be funded through a debt loan from a financial institution that understands NPA and OTS transactions and has such financial products to deliver OTS. They are able to cater to OTS transactions and have a deep understanding of the borrower’s legal & financial situations. These financial institutions provide funding for OTS from partial to full amounts of OTS as per the financial profile of the borrower and the valuation of underlying securities. This finance facility is available in all parts of India & a moratorium period can be given as a requirement, and the availability of funds. 2. Private Funding: An NPA borrower can take the help of a private funder/lender to fund their OTS. These private lenders are available on a local basis & can be accessed through local real estate agents who are in contact with private lenders. The best part of private funding is that it does not require any ratings and financial profile; they just need a collateral property, which must be located in their area of operations. Repayment can be done through monthly interest. 3. Sale of Collateral Property: The sale of collateral properties is also considered the best way to fund the OTS, and there is the majority of borrowers sell their collateral & complete their OTS Transactions. This can be done by obtaining permission from the existing OTS bank & whatever the amount comes from,this will be directly deposited into the bank to reduce the liability. A tripartite agreement is made between the Buyer, the Borrower, and the bank for the proper execution of the sale transaction. All the important terms & conditions are mentioned in this agreement which safeguards the rights of every member and also gives confidence to the buyer toward a transparent transaction.
Top 3 Ways to Fund an NPA Account
Getting funds for an NPA Account is very important for borrowers to maintain their business viability & to save their precious property from the sale activities of banks towards the recovery of the loan. When an account slips into NPA then as per policy all conventional banks & NBFCs do not extend any loan facility for borrowers. An NPA status is like a dead end for the borrower as the bank starts freezing their accounts and without the proper banking support, it is impossible to operate the business that faces difficulties in collecting payments from the clients or non-issuance of BG/LC facility. So closing the NPA account will be the topmost priority for the borrower but without proper banking support, it is nearly impossible to raise the funds to close the NPA account. So now, we will see who provides funds for the NPA account. Best 3 Ways to Fund an NPA Account 1. Term Loan: An NPA Borrower can apply for a term loan facility in NBFCs that is comfortable in extending a loan for NPA Accounts as these NBFCs are designed in such a way as to understand the complexity of NPA accounts. Their team can access the issues that push the client toward NPA and can understand the post-NPA legality like DRT & NCLT proceedings. They can also discuss with your previous banker to resolve the issue through their financial assistance and are capable of paying directly to them and also infusing the additional funds into the business. Click Here to fund your NPA Account 2. Private Lending: Private money lenders are also a good option for NPA borrowers as they provide finance only on the basis of market value of property not on the basis of ratings & financial eligibility of borrowers. Usually, private lenders fund 50% of the market valuation of property offered & follow a strict mortgage policy. 3. Business Partner: If the borrower has a good business model and has a high demand for the product that is capable of generating good profits, then he can seek out for business partner who can fund the NPA account & as well as infuse funds for the growth of the company. The client can put up an advertisement in the local business newspaper toward his requirement for a business partner and also take help of the business facilitators for the same. Conclusion: If an NPA borrower has a good-running business then he can apply for a term loan through some NBFC to fund the NPA account & can also raise additional funds for working capital requirements. And if you have additional collateral other than your factory/office & residence then private lending could be a good option. Lastly, if you have a good scalable business, you can also opt out of bringing a new partner into the company to fund the NPA. Click Here to fund your NPA Account
