Small business loan?

[leahjade]

Looking for small business owners - I'm thinking of starting a small business yet don't know where to begin! If I borrow money and the business fails, will I lose my house? Do I need to incorporate to be safe? It's so scary!

 

[TheIncredibles!]

Your best bet is to contact an Accountant and an Attorney to steer you in the right direction.

As for losing your house that depends on your finances and how to secure your loans and any lines of credit you need with vendors. Most vendors will only work on a COD basis for a start up company unless you sign a personal guarantee.

 

[mickeyfanfl]

You will be hard pressed to obtain a loan without collateral. Majority of banks want 2 years in business and positive cash flow. The SBA won't look at you unless you have an amazing business plan and/or buying into a franchise.

Definitely consult with an attorney and have a strong business plan made before doing anything.

 

[Cheshire Figment]

If you borrow money and lose it all you are personally liable. However even if you declare bankruptcy you will not lose your house.

And depending on what you are doing and whether or not you will have employees will determine if you need to incorporate. But be aware that for most new small businesses even if you are a corporation, the lender may ask for your personal guarantee on the loan which is to the corporation, so you are still not off the hook.

 

[4HOLIDAYS]

You may also want to spak with your ins. agent re. what policy coverage yo will need to change if any such as a much higher umbrella policy to protect yourself evn if you are incorporated.