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No loans for start ups! So NOW WAHAT?

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  • No loans for start ups! So NOW WAHAT?

    I spent the last 3 months working on a business plan for a mobile grooming business. I went to the Small Business Development Center in my area for help. They were so very impressed with my plan and all the work that I put into it. BUT.. banks are not lending to businesses for start up. I am a newbie, I dont have financials for two years. This year I resigned from teaching after 14 years and my husband was laid off. It has caused a strain on our finances as well. I have been working out of my kitchen since June. It's not easy to keep clean for all the fur flying!! Any suggestions?

  • #2
    I assume you are borrowing for a vehicle and some capital to run the business? Can you share about how much you need above the price of the vehicle? New or used? If new can you qualify for financing through one of the conversion company's contacts?

    Few more details might help us.

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    • #3
      my business loan was funded by a private lender. Do you know anyone who has the resources? Maybe another business owner in the area, family or church member? its worth looking into

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      • #4
        What about using your second mortage.. Not ideal most want to keep the business seperate from personal moneys. Also when I went to our local small business office recently they told me that banks need to see that the business can make money before they loan money, so what if you did it from a room in your home for a while and then go mobile later?

        Good luck!

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        • #5
          What I did, way back when in the dark ages, was to take out a personal loan. Have you tried YOUR personal bank? That is what we did. We went to the bank with our proposal and got a loan listed as Personal Creditworthy (if memory serves) but for the business startup costs. Your private, personal lender is going to be more ameniable. I would personally NOT count on my loan being disapproved until I spoke directly to a loan officer that told me as much. I never had any luck at all with our SBA> NONE>
          <a href="http://www.groomwise.typepad.com/grooming_smarter" target="_blank">My Blog</a> The two most important days in your life are the day you are born and the day you find out why. –Mark Twain

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          • #6
            I want to buy a used grooming trailer for $14,000. I was asking $20,000 to start the business. I did show in my business plan that I would break even and begin making a profit by month 6 or 7. SBDC told me that the banks were not lending for start-ups. So asking for your advice now?

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            • #7
              buy a moble thact already in

              If i was you i would look for one thact already has clients and see what u can cume up with than see if they take thact and pay rest off so many mouths. I had to sell right now because this to so if you can find one that is selling it help out lot.

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              • #8
                I agree that you have to try lots of banks, but when you use a business plan only do 1 bank at a time. They know when you are shopping around. Such things are tracked quite often.

                I agree that a private investor is an option to explore thoroughly.

                Have you checked to see if you can get a loan just for the trailer to see if you qualify for that alone, just to know. I have seen some people start mobile with just $5000 above the cost of the used vehilcle and so I know it can be done. Perhaps some members here have done that and will share how to do that. If you can get the vehicle loan but don't have the cash, you may have to work and save it up.

                Some banks are definitely loaning for startups. Recently I have clients that funded plans for startups, but indeed, they had very good credit and adequate collateral in personal property, some needed a co-signor too. They shopped a few banks too.
                Most questions regarding GroomerTALK are answered in the Board Help Talk Forum. Thanks for coming to our community a part of PetGroomer.com https://www.petgroomer.com.

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                • #9
                  It is true that banks, especially making SBA backed loans, heartily prefer purchases of existing businesses. Why? I put an article about that in the Magazine section here last week. You have immediate cash flow from the existing clientele.

                  In your business plan you take the last year's financial performance of the business you are buying and enter that in Year 1 of your plan and then project the following years financial performance under your new management.
                  Most questions regarding GroomerTALK are answered in the Board Help Talk Forum. Thanks for coming to our community a part of PetGroomer.com https://www.petgroomer.com.

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                  • #10
                    You sound like you are in the same boat I am in- only been grooming for a year and my husband is not working because a back problem, we are only getting 60% of his pay. I went from grooming school to a kennel to get more experience and pay the bills.
                    Our original plan was for me to get my home business started in the fall of last year. Well I had to have a hysterectomy in Sept. and within a week after I went back to work my husband went out with his back. Sucks just really sucks. Anyway I am doing both now working and trying to get my business started.
                    I know at this time the government is not helping much if at all and the banks cannot afford to take a chance on someone who cannot show that they can run a business. Your plan may be very good but unfortunatly for us newbies we have to show that we are a good risk. So don’t worry about the dirty house and get your business started at home keep good records. Do whatever you can to make money- dog sit, walk dogs, hell I will even watch cartoons with a pet if someone will pay me for it. Hopefully by the time you have your experience and customer base built up things will be better and you can get your loan. That’s my plan I hope it works.
                    Good luck to ya
                    Last edited by Poochie1; 04-08-10, 08:34 PM.

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                    • #11
                      Do you belong to a credit union? They are a little easier to deal with, I've heard.
                      Old groomers never die, they just go at a slower clip.

                      Groom on!!!

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                      • #12
                        I feel for you I have been in the same boat for well over a year now. I spent tons on grooming school, seminars, workshops, first aid training and equipment along with business school only to have the economy tank right before I started wanting to go for an SBA loan my business advisors at the school swear they are not giving out any start-up loans but some bankers I talk to say that isn't true.


                        I also am wanting to take out 5-7 K over and above my loan amount for the first 4-5 months of expenses so that doesn't make it any easier, I live in an apartment and have not collateral to use.

                        Have you tried going to a bank yet? The most they can do is say no.

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                        • #13
                          Well you can always just keep roughing it for awhile and save, save, save. I was once working 3 jobs. I nearly killed myself but I was able to save what I needed. If I hadn't gotten the sba loan, I would have just kept it up for another year and a half and saved up the rest...kinda wish I had since I am still making payments, but ah well. Where there is a will there is a way! If you can manage WITHOUT a loan, you will be enjoying more of your money down the road. Maybe you could add pet sitting or dog walking for extra cash??

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