Borrowing Money Loan? Advice Please

blondie27_2

Hi, i need to raise £4000 to pay for a Franchise licence for a business i want to set up. I am currently working full-time as well and intend on commencing my new business whilst still working.

First of all, what is the difference between getting a business loan from a bank for example to a personal loan? Are there any advantages of applying for a 'business' loan since that is what the money is for? Or am i just as well looking at personal loans which are generally used for anything? I realise that for a business loan, particular attention would need to be paid to a business plan etc where this wouldn't necessarily be so important in applying for a personal loan as it could just be for home improvements or consolidation of debts.

I have been reading the information on this website and it seems that for the amount i want and the term within which i hope to repay (18-24 months), it will work out cheaper trying to get a credit card such as the MBNA Rate for Life, however, i currently have an MBNA credit card via the AA which i only applied for and received last month. My concern is applying for further credit so soon and the fact that i already have an MBNA card. I was also refused just prior to that for a Sainsbury's credit card. I do however believe that i have a good credit rating in terms of always paying on time and paying previous credit cards, loans etc off.

If anyone has any information or advice they can give me it would be greatly appreciated.

Many thanks in advance.

lawrie28

How will you set up the business? Sole Trader/Ltd co?
Where do you want the debt? - your name or company name?
What security can you offer?
How can you be sure you only need the loan for 2 years?
what other startup costs are there? How are you funding that?
Do you have a business plan? If not, why not? If so, does it include repaying the debt in the cash flow?
How will you manage to run the business and your job at the same time?

These are only some of the questions that will be asked by the business bank manager.
You may find a personal loan is cheaper in terms of fees etc.

blondie27_2

lawrie28 wrote: »

How will you set up the business? Sole Trader/Ltd co?
Where do you want the debt? - your name or company name?
What security can you offer?
How can you be sure you only need the loan for 2 years?
what other startup costs are there? How are you funding that?
Do you have a business plan? If not, why not? If so, does it include repaying the debt in the cash flow?
How will you manage to run the business and your job at the same time?

These are only some of the questions that will be asked by the business bank manager.
You may find a personal loan is cheaper in terms of fees etc.

Thanks for this, it has been useful and given me some things to think about!