My partners and I have put together a thorough business plan and it's time to start talking about lending. My background is in Real Estate so I am of little use in defining what may or may not be "reasonable" as far as loan terms. In my world, a 48 month stop is a very short term loan. Is that the case when borrowing for start-up business ventures? We'd like to borrow $220-250K with a 30 yr. amortization and a stop at 48 months.
The plan is to refurbish and revitalize an existing property owned by one of the principals in order to host weddings and other events. The property consists of a 4500 square-foot three-story Victorian home with wrap-around decking on roughly ten acres with a small guest house and two-car garage. It is serviced by an operational artesian well which also feeds a small tree-lined pond which will serve as the main backdrop for ceremonies. About four acres are grass-covered and roughly five are wooded for privacy. Amazingly, this beautiful setting is located in the Arizona desert--offering a much desired escape from the cactus-laden landscapes of almost all of our area competitors.
What we need to know is what kind of terms we can expect to find given our circumstances. For the purpose of the loan, there will be two principals--both with around 800 FICO's. The W-2's will NOT support the amount of the loan so it will have to be unconvetional at best. Our conservative projections show the company's ability to pay off $250K in three years. We'll shoot for four to be safe. The research is thorough, the exit strategies are strong, we just need the proper incentives to attract potential lenders. What reasonable terms will we expect to have to offer in order to stop talking to brokers and start talking to lenders?
The plan is to refurbish and revitalize an existing property owned by one of the principals in order to host weddings and other events. The property consists of a 4500 square-foot three-story Victorian home with wrap-around decking on roughly ten acres with a small guest house and two-car garage. It is serviced by an operational artesian well which also feeds a small tree-lined pond which will serve as the main backdrop for ceremonies. About four acres are grass-covered and roughly five are wooded for privacy. Amazingly, this beautiful setting is located in the Arizona desert--offering a much desired escape from the cactus-laden landscapes of almost all of our area competitors.
What we need to know is what kind of terms we can expect to find given our circumstances. For the purpose of the loan, there will be two principals--both with around 800 FICO's. The W-2's will NOT support the amount of the loan so it will have to be unconvetional at best. Our conservative projections show the company's ability to pay off $250K in three years. We'll shoot for four to be safe. The research is thorough, the exit strategies are strong, we just need the proper incentives to attract potential lenders. What reasonable terms will we expect to have to offer in order to stop talking to brokers and start talking to lenders?
