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7 Replies Last post: Jan 15, 2009 5:45 PM by LUCKIEST

Business LOC for an LLC

Jan 15, 2009 3:39 PM

Click to view sunshine108's profile Professional sunshine108 4 posts since
Jan 15, 2009
We have a family partership LLC (in California) that holds the family home and a piece of land that we are developing for sale. The property has two lots and we have a contract with one buyer to purchase once the permits are in place. We have a cash flow problem and are looking for a business line of credit to complete the project. We originally wanted to get an LOC on the residence but because it is held in an LLC this wasn't possible. Any suggestions?

Thanks,
Sunni
Tags: financing_business_credit_start-up_line_of_credit_cash_flow Report as inappropriate
Click to view bmt2008's profile Mogul bmt2008 305 posts since
Jul 30, 2008
1. Re: Business LOC for an LLC Jan 15, 2009 4:11 PM
Have you contacted your local bank? With a buyer in place (assuming its is a well quailified buyer), should not be much of a hassle with the bank.

There are also many non-bank financing companies (many I know personally) that would love this deal provided it is a good buyer on the other side (companies that do only commercial RE deals).

How much are you looking for? Have you thought about the most traditional source of bootstrapping? - Credit Cards. What about other family members, can you pool funds?

Lastly, what about the buyer? Could they put up some funds now?

Just some thoughts
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Click to view Tori's profile Host Tori 79 posts since
Aug 15, 2008
2. Re: Business LOC for an LLC Jan 15, 2009 4:12 PM
Hi sunshine108 and welcome to the SBOC!

I know the Community can give you plenty of suggestions on how to handle your particular situation

Good luck
~Tori
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Click to view sunshine108's profile Professional sunshine108 4 posts since
Jan 15, 2009
3. Re: Business LOC for an LLC Jan 15, 2009 6:36 PM
in response to: bmt2008
We initially contacted our local banks about a personal LOC on the residence, problem was the title being in an LLC. So we began thinking about a business LOC. We are looking for interim funds to complete the first phase of permits. Once this is done the (well qualified) buyer will come in with his next cash contribution. He has put up cash already. I don't like the thought of credit cards. The LOC would work best for now as we move through this rather long process with the city and permits. We just need a pool of funds to draw on as we go. Once we get through this phase we will go for a more conventional construction loan for grading & retaning walls. So if there is a company that could make this available we're looking.
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Click to view LUCKIEST's profile SCORE LUCKIEST 7,935 posts since
Aug 6, 2007
4. Re: Business LOC for an LLC Jan 15, 2009 4:50 PM
Business LOC for an LLC, Welcome

YES I can help, I have suggestions, HOWEVER I made a New Year's resolution NOT to give out suggestions to postings who do NOT tell me who they are
Go to Members page and share some info with us and then I will be happy to share with you.
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Click to view sunshine108's profile Professional sunshine108 4 posts since
Jan 15, 2009
5. Re: Business LOC for an LLC Jan 15, 2009 5:12 PM
in response to: LUCKIEST
OK I filled in a few blanks. Thanks for considering my question.

Sunni
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Click to view sunshine108's profile Professional sunshine108 4 posts since
Jan 15, 2009
6. Re: Business LOC for an LLC Jan 15, 2009 6:36 PM
in response to: bmt2008
We initially contacted a few local banks. The problem was getting a personal LOC on a residence that is in an LLC. This is our preference but we haven't found a lending institution so far to do it. So we began thinking of a business LOC. I don't like the sound of credit cards for this. What we need is just interim funds to draw on as we continue through the maze of getting our permits from the city. It's taking us longer than anticipated and is draining our cash pool. Once we have the permits the (well qualified) buyer will come in with another relatively small amount of cash, he had initially put up a deposit. Then we will be looking for a more conventional construction loan to finish the grading & retaining wall phase at which point we will be ready to finalize the deal with the first buyer and sell the other lot.
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Click to view LUCKIEST's profile SCORE LUCKIEST 7,935 posts since
Aug 6, 2007
7. Re: Business LOC for an LLC Jan 15, 2009 5:45 PM
in response to: sunshine108
Business LOC for an LLC, Thanks Sunni

Great web site. I am a SCORE Counselor. Do you know about SCORE??

SCORE is FREE and can help you both in person and online.

In Business you need a Lawyer and an Accountant.

Let me know how I can help, LUCKIEST
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