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greenwater
02-13-2009, 06:07 PM
Has any one used this avenue? I am looking into it for an extra cushion.

Steve B
02-13-2009, 07:18 PM
Don't count on anything from those sources. You really will be getting the loan from a bank and the bank may get some guarantee from the SBA. Your bank loan application will be like any other loan application. Basically, you will need to prove to them that you don't need the money before they will lend it to you.

greenwater
02-13-2009, 08:01 PM
Thanks Steve. Someone else said that as well. I have some capitol built up and we have a good emergency account to support my wages for start up. Also I am lucky that my wife has a very stable job and that the only things we own on are our house, car and one toy. What I was looking at is having a line of credit to use if need be.

If you don't mind me asking, do you use a CC or a line of credit?

nealrm
02-13-2009, 09:18 PM
We use the SBA to help us get a business loan. I think it helped. However, that was 4 years ago and things have changed.

Baseline
02-13-2009, 10:57 PM
Always a good idea to get lines of credit, both bank and CC, in case you need them. But if you need them to run your business- be afraid. If you haven't got the cash flow to fund operations, perhaps the business isn't worth saving.

Now if you have a big, one time expense? No problem. But I know a lot of people who keep borrowing when the business just doesn't justify it, and have to go bankrupt. Don't fall in love with your business- she can break your heart.....

Steve B
02-14-2009, 04:15 AM
I set up a line of credit before I left my real job. I think the bank humored me and read my business plan, but I'm guessing I only got the line of credit because I made a lot of money at a corporate job.

I also had a credit card established for the business as well.

phanio
02-19-2009, 12:10 PM
SBA loans are a pain as stated - lots of paper work - double underwriting - fees. But, if your traditional banker is on the fence, the SBA could push him to your side. Let's say your banker wants 30% equity from you - SBA may only require 10%. Let's say your banker wants more collateral - the SBA may not.

Have not hear of the VA funding anything but homes - although there are SBA programs for veterans.

What are you looking for in regards to a cushion? If its a small amount - could use credit cards or a home equity line (which probably be the cheapest route) - and, you don't have to draw them until you need them.

Just some thoughts