August 28th, 2008 | 
Author: 
Ken Schulte asked:
In today’s marketplace you can have a good idea for a business and that is where it stops. In the business world we fail to teach alternative concepts because most concepts are taught are practiced by scammers or people that have no experience. For example, we are commonly taught that if you need money to finance a business, you go to the bank. Most potential business owners have no idea what the bank requires in order to give you a business loan. Mostly it’s experience in the field of your business, and a business plan.
If you fail to do your homework, and come into the bank prepared, you do not get the loan and your dream is deflated. There are better ways to do things if you are willing to do a little homework. The internet has helped with this fact immensely; it also has helped people to lose their money as well. As always using discretion is the key to success.
There are some very well know advisers giving good advice on how to start a business with unconventional sources. Suzy Ormon teaches the concept of borrowing money from family and using the large resources of credit cards to give you the capital you need to fund a business. A few years ago this concept would have been scoffed at. Today it is gaining more popularity. The key is discipline, if you cannot manage your personal credit card debt, then chances are good that you would not be able to do it for a business as well. I employ a slightly different concept of using my Line of Credit offered by my bank that is backed by the equity in my home. Why you ask? Well for one reason, it’s easy.
Starting a business is usually a struggle, and finding a loan with no or low expectations offers encouragement. Experience is the key here since your homes equity is on the line. But if you’re expanding your business or cranking it up a notch or two, this can be a great alternative. The second reason is my favorite, I am in control. Not that I am control freak, but it is good to have options. If I am having a good month and revenue is strong, I pay more towards my line of credit. If things are tight, I pay my minimum and keep planning. Again the key is discipline.
If you were smart when you bought your home, or had good timing, you might have some decent equity in your home. Banks want to make money and are always eager to offer lines of credit. Most are free of fees and closing costs. It’s considered a low risk investment for the bank since they have your house as equity. A good thing to keep in mind is to never borrow the money to use for payroll. I use the credit to purchase things, machinery or software that makes me money.
Think outside the box, even if you don’t have a home, getting one can be a goal. Business takes planning, part of that planning may be figuring out how to own a home that will give you some leverage.
Credit Card Business
In today’s marketplace you can have a good idea for a business and that is where it stops. In the business world we fail to teach alternative concepts because most concepts are taught are practiced by scammers or people that have no experience. For example, we are commonly taught that if you need money to finance a business, you go to the bank. Most potential business owners have no idea what the bank requires in order to give you a business loan. Mostly it’s experience in the field of your business, and a business plan.
If you fail to do your homework, and come into the bank prepared, you do not get the loan and your dream is deflated. There are better ways to do things if you are willing to do a little homework. The internet has helped with this fact immensely; it also has helped people to lose their money as well. As always using discretion is the key to success.
There are some very well know advisers giving good advice on how to start a business with unconventional sources. Suzy Ormon teaches the concept of borrowing money from family and using the large resources of credit cards to give you the capital you need to fund a business. A few years ago this concept would have been scoffed at. Today it is gaining more popularity. The key is discipline, if you cannot manage your personal credit card debt, then chances are good that you would not be able to do it for a business as well. I employ a slightly different concept of using my Line of Credit offered by my bank that is backed by the equity in my home. Why you ask? Well for one reason, it’s easy.
Starting a business is usually a struggle, and finding a loan with no or low expectations offers encouragement. Experience is the key here since your homes equity is on the line. But if you’re expanding your business or cranking it up a notch or two, this can be a great alternative. The second reason is my favorite, I am in control. Not that I am control freak, but it is good to have options. If I am having a good month and revenue is strong, I pay more towards my line of credit. If things are tight, I pay my minimum and keep planning. Again the key is discipline.
If you were smart when you bought your home, or had good timing, you might have some decent equity in your home. Banks want to make money and are always eager to offer lines of credit. Most are free of fees and closing costs. It’s considered a low risk investment for the bank since they have your house as equity. A good thing to keep in mind is to never borrow the money to use for payroll. I use the credit to purchase things, machinery or software that makes me money.
Think outside the box, even if you don’t have a home, getting one can be a goal. Business takes planning, part of that planning may be figuring out how to own a home that will give you some leverage.
Credit Card Business
About Wade Henderson
Wade Henderson: Domestic and International Business Finance since 1995 specializing in challenge situations. "We prefer to find a way to get your loan done as opposed to finding a reason to turn it down.” Connect with me on Google+
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