Starting a very small business - Financing help, please!!

GoBentleyGo

Hi all,

Please bear with me as I'm new to this forum and I'm not even sure I'm in the right area for posting this - but here we go...
I'm hoping to start a small business which I have calculated a start up cost of approx £6,000. I have a relatively small mortgage and contacted my mortgage lender to see if I could remortgage for the amount. My lender has refused to lend for business start up purposes - but WILL lend for house improvements, holiday's, general frittering away!!

My question is this: shall I ditch the idea of remortgaging and opt for a credit card? Or try for a business loan at the bank? Can't ask family, as I want to shoulder the full financial risk, in the event the venture doesn't work out.

Any advice would be really really appreciated.......

Candyapple

GoBentleyGo wrote: »

Hi all,

Please bear with me as I'm new to this forum and I'm not even sure I'm in the right area for posting this - but here we go...
I'm hoping to start a small business which I have calculated a start up cost of approx £6,000. I have a relatively small mortgage and contacted my mortgage lender to see if I could remortgage for the amount. My lender has refused to lend for business start up purposes - but WILL lend for house improvements, holiday's, general frittering away!!

My question is this: shall I ditch the idea of remortgaging and opt for a credit card? Or try for a business loan at the bank? Can't ask family, as I want to shoulder the full financial risk, in the event the venture doesn't work out.

Any advice would be really really appreciated.......

You answered your own question.

CLAPTON

how much are you talking about?
how much are you going to invest in the business of your own money?

GoBentleyGo

Thanks for that Candyapple.

I'm not in a position to use any personal capital (don't have any, lol!) CLAPTON.

knightstyle

If your credit rating is good why not use several credit cards? Then switch between them, interest works out at under 2% PA.
Cheapest money for your business.

jonesMUFCforever

What are you having to pay for that costs £6k?

Mr_Goodkat

Are you maintaining a job / income stream as you start up this small business?


What kind of vehicle are you using to set up the business - sole trader, limited company etc?


What is the £6k going to be used for and what do you intend to do about maintaining cash flow when that money is spent?


As it is a business you should set it up as such, put a business plan together and apply for a business loan. The fact you don't have any capital to invest yourself could deter the bank as they are shouldering more risk than you.


Personal credit cards could get you that amount but a personal credit card is not meant to fund a business set up so could become a problem if the credit card company became aware of it. Depending what you need the money for e.g. unless you can purchase what you need on credit card it will work out expensive with cash advance fees and interest rates unless you can get a MBNA or Virgin card that allows super balance transfers into a bank account but then again you then risk breaching your personal bank account terms and conditions by operating it for business purposes.