Borrowing Money for Business

Nemont

Active member
Joined
Oct 22, 2003
Messages
4,156
Location
Glasgow, Montana
I am moving my office, starting a new insurance agency, purchasing another book of business and expanding the consulting part of my business. All this required new office equipment, new software and upgrading all the computers.

I have the cash to do this but didn't want to spend alot of my own cash. I rarely borrow for anything but decided if I could make the numbers work I would borrow some money to get all this done.

Was a little worried because of all the bad news in regards to credit being "seized up". Shopped around and within half an hour I had all the local banks offering to lend me more then I asked and at a rate better then I budgeted.

I went in to sign the paperwork and the banker, who is also my duck and goose hunting partner, was asking me to verify that I really didn't have any other loans or payments, "for real". Kind of funny, he said that my wife's and my credit rating reduced the interest rate by over 2 percent. As I was leaving he smirked and said to, "Come see him to borrow more money as soon as possible". He knows I am too cheap to pay interest for very long but it sure doesn't look like there is a credit crisis if you are "credit worthy".

Nemont
 

DRAFTSTUD

Active member
Joined
Nov 14, 2002
Messages
5,082
Location
SHREVEPORT, LOUISIANA
You are correct on the Credit Worthy part of it. Even if you never wish to take a loan out, you should develop a relationship with your Banker. That has made getting the funds during difficult times easier and faster for my company, but they will try to load you up! John
 

IDHunters

New member
Joined
Sep 15, 2005
Messages
534
Location
SE Idaho
There is no doubt good credit goes a really long ways today. As it should.

However, go back to those same banks and ask for a construction loan on a spec house, or to develop a subdivision. At that point, for 90% of the banks out there, the answer is no, regardless of credit.

Hopefully the consumers (that can afford it) realize there is not only credit available, but its rather cheap-for the right deals.

By the way congrats and good luck on your new business.
 

Moosie

Grand poopa
Joined
Dec 9, 2000
Messages
17,514
Location
Boise, Idaho
I agree on the construction loan. In the Lending sector for that portion they want you to have Skin in the game. I've seen guys with a million in the bank and 800 scores needing to come in with 20% on a construction deal.

that being said, Good credit does get you far. People tend to take that to lightly. It's amaising what 1 or 2 late payments will do to you..........
 

Steiny

Member
Joined
Sep 4, 2003
Messages
495
Location
North Central, IN (the corn belt)
The banks always need good loans, and Draftstud's point about maintaining a good relationship with your banker is right on the mark.
Plenty of money out there and good deals for the right people and right projects.
 
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