Finding an unsecured business loan for £15,000

geoffky

zxspeccy wrote: »

A stated before you are asking for the Bank to take 100% of the risk for this venture. If it fails then they will be out of pocket to the tune of up to £35K, if it succeeds then they will get the borrowing paid back (and a bit of interest). From your perspective if it fails then you won’t be out of pocket (although you will have an outstanding debt you will be unable to pay), if it succeeds then your will be quids in. The whole deal is weighted in your favour, and what Banks are looking for is for the risk to be spread. This means they would want you to invest some of your own hard earnt cash into the business, which will give you a bigger incentive to make a success of the venture (as you own money is at risk as well as the banks).

There is also some important questions that would need to be answered as well:

Is the business a franchise?
If it is so successful then why is the present owner selling? (if it was me I would want to hand down such a successful business to a sibling and to keep it in the family)
How did they come up with the valuation of the business?
Is the business a “Keyman or woman” business and if so how will you protect yourself against this?
How many years of accounts have you been given to analyse? and are they audited? also what is the most recent set of accounts telling you?
What value does the Balance Sheet give the business? and how much of that value is physical assets, and how much is tangible?
Have you gone through the contract of sale with a fine toothcomb?
Are there best and worse case scenarios built into your cashflow forecast?
Is you business plan robust?
What business experience do you have in this particular line of work?

Like others on here I don’t think any bank will lend you 100% of the money and certainly not unsecured. Could you not just buy into the business as a partner (lower equity), this will help with the handover (especially the handover of clients) and also provide some much needed training at the outset. Then with your share of the profits you could buy more and more of the business until you own it outright. Of course this would have to be drawn up in the contracts at the outset.

Good luck and keep us updated.

Great advice. I hope the op acts on it.