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    10 Replies Latest reply on Apr 16, 2008 10:37 PM by LariosVox

    New Business Loan

    NorthEast Newbie

      How do you get a business loan for a new corporation? If the company has no credit history do they use personal credit to guarantee? I thought that was the point of being incorporated? So they couldnt come after your personal assets if the business doesnt work? Suggestions on which company to apply for a loan with?

       


      Thank You
        • Re: New Business Loan
          LUCKIEST Guide
          New Business Loan, Welcome to this web site.
          The overall problem is that banks want to get paid back on loans.
          Tell us more. Tell us about yourself and your company.
          Do you have a Business Plan. All lenders and or investors will want to see one.
          Do you know about SCORE. SCORE is FREE with advice. No Money,
          LUCKIEST
            • Re: New Business Loan
              NorthEast Newbie

              Yes I do have a very detailed business plan. I was told by Bank of America that you cant apply directly for an SBA loan. That I would have to apply for a bank product and if I was denied I would be automatically considered for an SBA loan. Problem is BOA doesnt help with startup business anymore so they have no products I can apply for. I do have some assets I can put up but not enough to cover the whole loan I'm looking to obtain. It seemed odd that you couldnt go straight to the SBA unless they also do not lend to startups. Any advice?
                • Re: New Business Loan
                  TennisMan Newbie
                  Northeast:

                  I am having the same problem. I was told by a SCORE counselor to apply for a loan and if you get denied apply for the SBA loan. I'm finding it difficult to find a loan product for startup business to apply for as well. I will be talking to a counselor on Saturday; so what ever advice I have I will share with you.

                  TennisMan
                    • Re: New Business Loan
                      TJMorehead Adventurer

                      Hello TennisMan,

                      I'm a technical assistance provider, there is a product for start-up businesses to secure financing. I'll be happy to assist you with starting a funding request. You can visit my blog page to learn more about the program "Accessing Capital", you can complete a pre-qualification form. From there I can send a pre-application to complete.

                      Feel free to email me at moreheadsconnections@gmail.com.

                      Warm regards,
                      TJ Morehead
                • Re: New Business Loan
                  Lighthouse24 Ranger
                  Welcome to the community.

                  Limited liability is just one of the points of incorporating, and as you indicated, it means a person's financial liability is limited to a fixed sum (usually the value of a person's investment in the company). Nevertheless, a shareholder is still liable for his or her own acts on behalf of the firm in most cases. For example, since a new company generally has no credit history and limited assets, one or more directors may be required to give a personal guarantee to lenders or other creditors. Those directors will then be liable for those debts in the event the company cannot pay.

                  The first place to begin seeking a business loan or credit line is your banker. If you have a few moments, take a glance at this in the Stories section:
                  Get to Know Your Banker

                  Hope this helps. Best wishes.
                  • Re: New Business Loan
                    LUCKIEST Guide
                    There is a post from "CASH FOR BIZ" as follows- - -
                    To help you I provide alternative financing for all small and medium
                    businesses.
                    Contact me at 347 223 1434 or email me at
                    vernel87@yahoo.com .
                    BE CAREFUL
                    • Re: New Business Loan
                      TJMorehead Adventurer
                      Hello Northeast,

                      FYI, I am an authorized technical assistance provider. Visit my blogpage at www.moreheadsconnections.blogspot.com to read about a Government program, CommunityExpress Loan. It's under my "Accessing Capital" write up. You can also complete a pre-qualification form to start the funding process. Once you've completed the form, I'll send you the pre-application to complete as well.

                      My email is moreheadsconnections@gmail.com.

                      Warm regards,
                      TJ Morehead
                      • Re: New Business Loan
                        mlebovits Newbie

                        Northeast and Tennis Man,

                        The SBA does not make loans directly to borrowers, but provides guarantees to participating lenders who provide the loan.

                        The 7a program is most likely the best fit with your respective financing requirements and can support financing for startups. With credit availability tightening for all borrowers, it's best to demonstrate that (a) you have cash to inject in the business, (b) you're business will generate sufficient cash flow to service the loan and (c) you have assets inside or outside the business to collateralize most of the loan.

                        The credit criterion will vary from bank to bank on which ones will fund startups, companies in your respective industries and how much cash you'll be required to invest on day one. Expect a cash investment requirement of at least 10%, but many banks are requiring as much as 30% of the total project cost.

                        In the early years of the business, you'll be building your company's credit profile. In the interim, your personal credit profile will be on the line. Minimum FICO scores will vary by bank. I've seen minimum score requirements range from 625 to 680 and higher.

                        I think one of you asked about the "credit elsewhere" criterion. The SBA participating lender will need to confirm to the SBA that you didn't qualify for non-SBA loans. As startup businesses, this shouldn't be a problem. I don't think there's a hard and fast requirement for you to get turned down first for a conventional loan.

                        Hope this is helpful - please feel free to visit my blog at www.Funding911.com for more information.

                        Marshall Lebovits
                        • Re: New Business Loan
                          TJMorehead Adventurer
                          Hi Northeast,

                          I failed to mention that the CommunityExpress Loan is designed for start-ups and emerging companies. There is no business plans required; no personal financial statements requested; not tax returns needed; no collateral; no early payment penalties; no complex paper work.

                          Warm regards,
                          TJ Morehead
                          • Re: New Business Loan
                            LariosVox Wayfarer
                            BOA is now offering a new product called "Gold Option" for Business, which in the past was called "Business Credit Express" up to 100K. Unsecured ofcourse the grantor is you and the borrower is the Business. I dont think any business begins credit without an individual grantor. Good luck with all and make sure you sit with a personal Banker to discuss details. Once you do have an open mind and receive all feedback you will be surprise with the knowledge you take back to the business. The reason I say it is from personal experience...I actually did two different scenarios and visited several Banking centers with questions on types of loans available for business. Good luck and stay connected