Understanding Vehicle Financing

CarShopping for a new car is an exciting process, and contrary to popular belief, obtaining financing doesn’t have to ruin the fun. If you take the time to learn about the two basic types of financing, direct lending and dealership financing, before you take your first test drive, you’ll be setting yourself up for a smooth, efficient shopping experience.

After learning about the pros and cons of each type of financing, you will be ready to find the right car with the right financing.

With dealership financing, you make your agreement with the dealership when you want to purchase your vehicle. The dealer works with you to form an agreement on how much you will pay per month and how much you will pay overall, depending on the vehicle you want, your credit history and several other factors. Sometimes the dealer will sell your contract to a financial institution, and that financial institution will collect the payments.

One benefit of dealership financing is it can be convenient. Provided that you are able to find a vehicle you like and financing you like at one dealership, it can be one stop shopping. Furthermore, the fact that dealerships are open long hours and throughout the weekend may be more convenient if your financial institution has limited hours.

The United States Federal Trade Commission (FTC) states that another advantage of working with a dealer is that “dealers sometimes offer manufacturer-sponsored, low-rate or incentive programs to buyers.”

The FTC cautions that, “The programs may be limited to certain vehicles or may have special requirements, like a larger down payment or shorter contract length (36 or 48 months). These programs might require a strong credit rating; check to see if you qualify.”

Your other option for financing is direct lending, which means that you apply for and receive a loan directly from your preferred financial institution. This means that you’re able to work with your trusted community financial institution, a place where you know you will be treated well and have an established relationship. When you find a vehicle that you want, you form a contract with the dealership and use the loan to pay for it.

Another advantage to direct financing is that you have the opportunity to secure financing and determine exactly what you can afford before your emotions get involved with the shopping process, which can help you stay within budget. Furthermore, if you apply for financing at a dealership after deciding on a vehicle, the dealer has the upper hand by knowing that you’re already interested in the vehicle and that you most likely want to make a deal instead of walking away empty handed. When working with your financial institution, you have no pressure to make a deal, and the financial institution knows that you can comparison shop at other institutions, so it has incentive to give you a great deal.

“Any time you get preapproved, you help yourself out,” states Justin Pritchard from About.com Banks/Loans. “You learn what lenders are willing to offer, and you gain negotiating power. Preapproved auto loans, like any other loan, allow you to: know how much you can afford, shop like a cash buyer, and understand the costs you’ll pay.”

When you work with a lender directly, there are no surprises. You walk onto the lot knowing exactly what you can afford, so you don’t waste time looking at cars out of your range. That way, you avoid getting lured by deals that are only applicable to car buyers who qualify for a lower rate than you do.

“You may spend hours looking at vehicles and negotiating with dealers, only to find out that you’re in above your head,” states Pritchard. “The auto buying process can be grueling, so focus your attention on what you know will work.”

Not only will there be no surprises about your qualifications, there will also be transparency when it comes to how much you end up paying.

“Dealers are notorious for trying to focus your attention on the monthly payment,” states Pritchard. “That way, they have room to fiddle with other parts of the deal. When you have a preapproved auto loan, the payment is none of the dealer’s business – so there are no games to play.”

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Summer Vegetable Lasagna

Recipe-SummerVegLasagnaIngredients:

  • 6 oz. mini lasagna noodles, cooked al dente and drained
  • 1 medium zucchini, shredded or finely chopped
  • 12 oz. shredded mozzarella cheese
  • 1 cup spaghetti sauce
  • 2 medium tomatoes, chopped
  • 1 or 2 cloves garlic, finely chopped
  • 12 oz. ricotta or cottage cheese
  • salt and freshly ground pepper

Directions:

Preheat the oven to 375°. Squeeze or press the shredded zucchini to remove some of the moisture. Layer the following into an 8×12-inch (or similar) non-stick lasagna pan:

  • 1/2 of the cooked lasagna noodles
  • 1/2 of the grated mozzarella cheese
  • All of the spaghetti sauce
  • 3/4 of the chopped tomato
  • All of the garlic
  • Salt and pepper
  • 3/4 of the zucchini
  • All of the ricotta or cottage cheese

Press the remaining ingredients firmly into the pan. Top with the remaining noodles, tomato, zucchini, and mozarella cheese. Bake for 30 to 40 minutes. Serves 6.

 

Merchants Family Cookbooks are available at all Merchants Bank locations for $15. Proceeds benefit local food shelf programs.

Three Ways Technology Is Changing Small Business Finance

New technology helps entrepreneurs get their products and services to customers more efficiently.

New technology helps entrepreneurs get their products and services to customers more efficiently.

Technology is an entrepreneur’s best friend. With the right tools, entrepreneurs are finding that it is easier than ever before to bring in customers, design new products and manage day-to-day operations. Here are a few of the latest ways that technology is changing the world of small business finance.

Mobile Payments
Before the era of mobile devices, if you didn’t want to alienate customers by only accepting cash, you needed a traditional register (point of sale) system. This left many entrepreneurs, such as those working booths at craft fairs or providing services outside of a brick-and-mortar setting, out in the cold.

Now, it’s possible to use a mobile device to accept plastic from customers anywhere you have reception, opening up a range of possibilities. Square is a device that allows you to swipe cards and process payments right on your smartphone or tablet. Its monthly subscription service is best for those who “do five-six digits in sales every month,” and “have very few transactions over $400,” and “key in very few transactions,” according to Forbes contributor My Say.

For those who make many monthly transactions, or those who have many transactions over $400, or those who don’t make sales in the five or six-figure range, Say recommends Breadcrumb by Groupon. Another excellent and flexible option to consider is PayPal.

3D Printing
When 3D printers arrived on the scene, they seemed like something out of a science fiction novel, but they quickly proved to be a tremendous asset in many fields. Businesses currently using 3D printers are quickly discovering just how many ways this tool can revolutionize the way they work.

“For some, it creates an opportunity to differentiate from the competition. For others, it’s a chance to improve internal processes, like design and development, and streamline production,” states Fox News Business contributor Elizabeth Palermo. “But in some industries, especially those that create highly customized products, such production methods are essential.”

Entrepreneurs who want to make a model of a product no longer have to find a factory able to produce it before they can show potential investors and clients. With the invention of 3D printing, the process is faster than ever, making it easier for would-be entrepreneurs to take the leap into the business world.

Fox News Business profiled the development of an ergonomic baby spoon called Spuni, which “owes its existence in large part to 3D technology,” according to Palermo. “The company was able to print the first versions of Spuni using medical grade, BPA-free plastics that could be tested safely by parents on their babies. The ability to test their prototypes helped Botha and his colleagues churn out a final version of the product much faster than if they had used traditional manufacturing methods for prototyping.”

Predictive Analytics
Predictive analysis uses technology to maximize sales opportunities by attempting to accurately predict the future behavior of customers. Entrepreneur.com contributor Mikal E. Belicove describes how he would use predictive analysis to make more money at a hypothetical pizza shop.

“If I knew exactly how many cheese, pepperoni or veggie pizzas I was going to sell on a given shift, I could have those ingredients on hand, and maybe even make them ahead of time, so the customers get their pies fast,” describes Belicove. “And if I knew that half my customers order a large soda with their pizza, I could offer them a pizza/soda special to keep them coming back.”

A Business Intelligence tool is necessary software to run these types of analytics. Entrepreneurs who know how to program can make use of free tools like R from Revolution Analytics. You don’t have to know how to program to use this technology, however.

“If you just want a way to visualize your data to make it easier to understand and follow, there are inexpensive dashboard tools like Geckoboard and Leftronic that you can try out for less than $100 a month,” states Belicove.

With technology like 3D printing, predictive analysis and mobile payments, more people than ever are realizing that they truly can start a business.

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Five Movies That Are (Arguably) Better Than the Book

MoviesMovies and books have a lot in common. They both tell stories, make us think, and introduce us to new and interesting worlds. Most people agree that books are usually better than their film adaptations. Although, every once in a while there is a movie that becomes even more popular than the book. These are some of those movies.

“Les Miserables”

While Victor Hugo’s 1,500-page epic, “Les Miserables” is considered a classic, many people in contemporary times find it a laborious read and prefer to watch the 2012 musical adaptation of the same name, based on the long-running Broadway show. Great music and eye-popping visuals give the viewer a unique experience.

“The Curious Case of Benjamin Button”

This film that tells the tale of a man who ages backwards received critical acclaim for its quirky story and special effects. The short story it is based on, written by F. Scott Fitzgerald, contained much less detail than what is seen in the movie. Director David Fincher took artistic license when he added new characters, extra scenes, and a different tone to this peculiar tale.

“The Lord of the Rings”

Although J.R.R. Tolkien’s fantasy masterpiece is considered one of the best books ever written, director Peter Jackson took on the challenge of crafting films of equal quality. All three of the “Lord of the Rings” movies are cherished among fans of the novel and movie-goers alike. The final film in the trilogy, “The Return of the King,” even garnered an Oscar for Best Picture.

“Jurassic Park”

Michael Crichton’s novel brought readers to an entirely new landscape where dinosaurs existed in the modern day. However, Steven Spielberg upped the ante and gave us jaw-dropping special effects and amazing dino technology. Even now, 24 years later, the velociraptor scene still scares the pants off of many people. Spielberg also made the film much easier to understand than the book.

“Harry Potter and the Order of the Phoenix”

Many fans of the Harry Potterseries would strongly disagree with this one, but there’s no denying that the film version of J.K. Rowling’s 870-page book weeds out all the slow parts of the novel. While the novel includes much about the children in the school, the movie focuses on a more important topic: the impending doom of the wizarding world. However, a case can be made that all of the other Harry Potterbooks are just as good as their movies, if not better.

Books give us a world where we can conjure up our own images. Movies can sometimes serve as a form of checklist, so we can see how much we imagined right. But then again, the makers of films are just using their own imagination as well. Even though it’s extremely rare, sometimes a movie takes us to a place far beyond where the book ever did.

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How to Earn More Credit Card Points and More Rewards

Emily Buxengard, Credit Card Assistant

Emily Buxengard, Credit Card Assistant

You could be earning 2x, 3x, 4x or more points on purchases when you use your Visa ScoreCard Credit Card. Did you know that you can earn bonus points by making purchases with your card at participating retailers? “If you have a Merchants Bank Visa ScoreCard Credit Card you are automatically enrolled in our ScoreMore program,” says Emily Buxengard, Credit Card Assistant. “It’s so easy to earn bonus points and there are thousands of retailers participating in ScoreMore.”

Here’s how to find out which retailers are participating and how to activate bonus points:

  1.  Go to www.scorecardrewards.com and sign in to your ScoreCard Rewards account. Or, when viewing your Credit Card account online through www.mycardstatement.com, click on the Rewards Points link at the bottom of your home screen.
  2. Click on the ScoreMore icon on the bottom left of your screen.
  3. Find a retailer by:
    • Using the Search function on the right side of the screen.
    • Clicking View all Retailers and then using the alphabetical retailer index above to browse.
  4. To activate bonus points:
    • For online purchases: Click on See Details under the retailer’s bonus points offer and then on Click here to activate. You will be taken to the retailer’s website where you can browse for products. When you complete your purchase using your Visa ScoreCard Credit Card, bonus points will automatically be added to your account.
    • For in-store purchases: Click on the blue Activate button on the right side of the screen. The button will turn green and show bonus points are active and display an expiration date for the offer. When you complete your purchase in-store using your Visa Scorecard Credit Card bonus points will automatically be added to your account.

To redeem your points for everything from movie tickets to a Caribbean cruise, shop our selection of items at http://www.scorecardrewards.com. For help activating ScoreMore bonus points, contact our Credit Card Department directly at (507) 457-1160. After bank hours, weekends, or holidays, please call 1-800-854-0790. Click here for more information on all of Merchants Bank’s Visa Credit Cards and how to apply today. All credit cards are subject to credit approval.

* Qualifying ScoreMore Transaction shall mean: 1) a purchase transaction made with Your Account; 2) a transaction that takes place at eligible, participating Retailer locations (“In-store Purchases”) or through eligible links to participating Retailer websites accessed via the ScoreMore link on http://www.scorecardrewards.com (“Online Purchases”); 3) a transaction that meets Retailer qualifications as disclosed in the Retailer Offer (“Retailer Offer(s)”) on the ScoreMore web pages. PIN purchases do not qualify for ScoreMore Point earnings. Only signature transactions qualify for ScoreMore Point earnings when made with Your participating Account.

*ScoreMore Points for qualifying In-store Purchases are typically awarded within seven (7) days of transaction posting; Points for Online Purchases are typically awarded within thirty (30) days of transaction posting. Awarding of Points for some Retailer Offers may require additional processing time. Points for Travel Retailer Offers are awarded when travel is completed.

John Diersen Joins Board of Directors

DiersenJohnWell-known local Dairy Farmer John Diersen has been appointed to the Merchants Bank in Caledonia and Spring Grove Advisory Board of Directors, according to Matt Schuldt, President for Merchants Bank in Caledonia and Spring Grove.

“John is a valuable addition to the Board. He brings us a lot of knowledge about farming and the ag community, especially the dairy industry,” Schuldt said. “Plus, he’s about improving the community. He and his family give a lot back and are a big part of our area.”

Diersen is looking forward to giving his time and knowledge to the Board.

“I want to be able to contribute to the Board, not just be someone sitting in a chair,” Diersen said. “I’ll be able to provide input as far as farming, helping to pinpoint what to look for when it comes to the business of agriculture.”

Diersen, 62, farms with his wife, Karyl, and two sons, Joshua and Jayson, at Minnigan Hills Farm outside of Caledonia. The farm has been in the family since John’s grandfather. Currently, they farm 500 acres and milk between 135 and 150 Holsteins. Diersen is involved in the embryo business with three other local dairymen in Four Cal Genetics. The Diersens have also been involved in the American Dairy Association for many years and take a lead role in the Houston County Fair. John is a member of St. John’s Lutheran Church and has served on the board of directors at the church.

Six Ways Your Business Can Save More Money

A cost-saving plan to uphold your business budget.

A cost-saving plan to uphold your business budget.

If you own a small business and are on a budget, you’re not alone. Running a company is no inexpensive task. That’s why it’s important to put saving money on the top of your priority list. Cutting costs in every way possible is essential to ensuring that you’re gaining profits.

The good news: saving may be easier than you think. There are tons of ways you can tighten your belt on the job. Try these penny-pinching tips:

Utilize the web - You already know to use social media tools like Facebook and Twitter, but also take a look at discussion groups and message boards, too. These groups are a convenient way to get your business’ name out there quickly and easily—all you have to do is sign your name with your web URL. And best of all, it’s free!

“I didn’t start [participating in online discussion groups] to generate business, but as a way to find information for myself on various subjects,” said Shel Horowitz, owner of Accurate Writing & More, Northampton, MA, and author of several marketing books, including Grassroots Marketing. “But it turned out to be the single best marketing tool I use. It costs only my time. [One] list alone has gotten me around 60 clients in the past five years.”

Form relationships with vendors – Being a loyal customer can take you far. When you frequently use a vendor, they’re more likely to let you in on certain deals as they occur or even offer you a reduced price on a regularly bought item.

“In order to approach this, make sure you have the same employee work with the vendor each time you contact them, always contact them in advance, and benefit them whenever you can by referring business to them,” advises Emily Swartz, marketing communications specialist at Broadview Networks. “Even if they don’t cut you deals, having a vendor that’s dependable and consistent is more money-saving than you might think.”

Go paperless – Chances are, the amount spent on paper, ink and postage can add up. If you get rid of it all, over time, you’ll see your savings grow steadily.

“Businesses should shift towards paperless payments for many reasons,” said Mitch Rose, vice president of BillTrust. “Businesses should not be reliant on the USPS for receiving payments. There is already too much going on with the USPS from rising rates, closing of postal locations, lost mail, delays due to disasters or vandalism, etc. Just as important, the cost to a business to apply a paper check payment is significant. They struggle with keying it in, getting the payment deposited in a timely manner and applying the payment to a specific invoice.”

Pay attention to how much you spend on the little things – There are certain small items that may be bought when you’re running a company that are easily overlooked — things like office supplies, cleaning tools, coffee, etc. And although small and not necessarily the most pricy, these items can add up without you ever really noticing. Spending a little extra time searching for good deals on these items can keep these costs from accumulating. Compare prices and also check for free shipping, which many companies offer on bulk items. You may also opt for cleaning the office yourself or save on package-related costs by delivering something to a close-by client. Also, get creative: buy recycled printer cartridges, buy used equipment on craigslist.com, etc.

Don’t overspend on taxes - Sometimes if businesses are new to a location, they’re subject to a higher tax rate. In order to avoid spending too much on taxes, take action.

“Go to city hall to determine what your neighbors are paying, and use this to negotiate a better rate,” suggests Pete Collins of PricewaterhouseCoopers LLP in NYC. “Expanding businesses can often negotiate with community authorities, who want them to stay in town rather than move and take jobs elsewhere.”

Go green - A double whammy: save money and help the planet. Things like recycling, for one, can help you scrimp and save at the office. “More and more businesses are recognizing the benefits of reducing their waste,” said Carrie Hamblen, executive director of the Las Cruces Green Chamber of Commerce. “Not only can it save businesses money by reducing their overhead (but) recycling (is) good for business and benefits us all.”

Other ways to “go green” include using reusable items like mugs instead of cups for coffee, buying products locally and investing in energy-saving utilities, such as lighting.

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