Business loan

[curtintex]

We are trying to get into the land clearing and mulching business. I know there's plenty of competition but thats with any industry you get in. We started a roofing business a year ago that is going really well but we just qualify for loans because of time in business.

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What will the funds be used for? Purchasing equipment? Operating cost?

Unless you’re just in love with the idea of land clearing, why not just continue to grow the roofing business? I understand the need for diversification, but if you would be involved in the operating of both companies, I can tell you from experience it is hard to ride two horses with one ***.


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[brnhtown]

What will the funds be used for? Purchasing equipment? Operating cost?

Unless you’re just in love with the idea of land clearing, why not just continue to grow the roofing business? I understand the need for diversification, but if you would be involved in the operating of both companies, I can tell you from experience it is hard to ride two horses with one ***.


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The money would be for equipment financing only. I would be in charge of the land clearing company and business partner would operate the roofing company

[CEO]

How much equipment are you trying to buy? We are in the equipment rental business so I know it can add up quickly. As far as loans, they are tough to get starting out even if you have stellar personal finances. We ran into that but now those same banks are always trying to give us money. We do give preference to the ones who helped us out in the beginning.

[curtintex]

The money would be for equipment financing only. I would be in charge of the land clearing company and business partner would operate the roofing company

Gotcha! If used for equipment purchase, then the loan would be secured by the equipment. Have you looked at dealer financing options? I own a couple hundred pieces of heavy iron and dealer finance rates have always been better than my bank. Not even close. There are also independent finance companies that only finance heavy equipment. There are Lease Purchase Options (LPO). You can rent the equipment. You have a lot of options that are better than conventional banking for equipment purchasing.


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[brnhtown]

How much equipment are you trying to buy? We are in the equipment rental business so I know it can add up quickly. As far as loans, they are tough to get starting out even if you have stellar personal finances. We ran into that but now those same banks are always trying to give us money. We do give preference to the ones who helped us out in the beginning.

Just trying to buy a skid steer mulcher, around $108k

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[brnhtown]

Gotcha! If used for equipment purchase, then the loan would be secured by the equipment. Have you looked at dealer financing options? I own a couple hundred pieces of heavy iron and dealer finance rates have always been better than my bank. Not even close. There are also independent finance companies that only finance heavy equipment. There are Lease Purchase Options (LPO). You can rent the equipment. You have a lot of options that are better than conventional banking for equipment purchasing.


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We tried using the financing through the dealership with awesome terms, but the finance company wouldnt approve us due to years in business

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[flatlander]

Lol.... man this is truth. If you have a normal job making 100k a year with good credit you can pretty much buy whatever you want on credit.

Check that self employed box and the chit hits the fan. Doesnt matter if you can prove you're making 200k with good credit.

Seems banks are scared to death of those who are self employed. Even those who have been successful.

This hit me like a rock also, I learned very quickly that my job title is 'general manager'. Problem solved. Suddenly I'm just a guy with a good income again, unless it's for real estate, the bank still wants all the extra paperwork.



OP - Go shop and get a great rental rate on the equipment you'll need. It will be less profitable but you'll be in the business. Then take advantage of the manufacturer financing at really low rates once you're established. Many offer 0%.

You will essentially be running an equipment company, brush clearing is just what you'll spend your time doing to pay for the equipment.


Rule #1 - get the best accountant you can find, for many reasons, but one big one is that the good accountants have relationships with banks. They work together more than I ever knew before I was in business.

[outlook8]

We tried using the financing through the dealership with awesome terms, but the finance company wouldnt approve us due to years in business

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You can't buy it personally through the dealer? Or with a personal guarantee? That doesn't sound right. Can you use the AR from your other business as collateral?

[brnhtown]

You can't buy it personally through the dealer? Or with a personal guarantee? That doesn't sound right. Can you use the AR from your other business as collateral?

They dont do personal loans where we went, only business loans.

Trying a new dealership now that says they will work with us.

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[TxDispatcher]

Running your own is nothing like you think it will be, and lots of people can't do it.

Truth!

Yeah good luck getting an unsecured loan to start up a business. I wouldn't do it if I was the bank, no offense to you but I get stuck holding the bag if you fail and I then have nothing to recover that loss if it is unsecured. And being unsecured you don't have any incentive to not default as you don't lose anything, I have to eat all of the risk. Just the way the world works and for good reason.

Yep...a former employee of ours had a business that he wanted to start a few years ago. His work was impeccable, a beautiful master carpenter/woodworker. He had a great plan on building things. He approached my father-in-law about getting him to invest. After the meeting, my father-in-law stated “his work is top notch, but he has no idea what he is doing on the business side of things and has no idea how to acquire customers. I just can’t take the risk”

Point is this...even if you have the skills and are at the top of your field, there is more to it than most can even imagine. I’m fortunate to be married to a business minded lady who learned from one of the best...and it’s still a struggle at times to keep the ship upright and sailing in the midst of the inevitable storms. Most investors are gonna look deeper than “just” the “product” that you are offering. Best of luck to you, OP I hope you are extremely successful

[BrianL]

Lol.... man this is truth. If you have a normal job making 100k a year with good credit you can pretty much buy whatever you want on credit.

Check that self employed box and the chit hits the fan. Doesnt matter if you can prove you're making 200k with good credit.

Seems banks are scared to death of those who are self employed. Even those who have been successful.

I here this a lot in finance...

Customer: "I made $250K last year"

Me: "Your last years tax return shows you made $25K.........."

Customer: " Awww, that just what I reported"

Me:

[Mexico]

I here this a lot in finance...

Customer: "I made $250K last year"

Me: "Your last years tax return shows you made $25K.........."

Customer: " Awww, that just what I reported"

Me:

I made 25k last year too...

Ignore the boat and truck


I'm liquid enough these days I just take a loan against my own money

[RedBear78]

Just trying to buy a skid steer mulcher, around $108k

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Yes like Curt said Lease purchase may be an option.When I first went into business for myself I needed a tractor.Kubota did a lease purchase program with me.I got my new tractor and helped build my business credit.I think after just 6 months i bought it and Kubota financed the whole thing.

[dclifton]

What brand mulching machine and head are you trying to buy? Most equipment dealers will sell to individuals, Like cat, deere, kubota etc.

IDK how Takehuchii and ASV are about it since most of those dont have their own financing options. Like Cat and Deere do.

[brnhtown]

What brand mulching machine and head are you trying to buy? Most equipment dealers will sell to individuals, Like cat, deere, kubota etc.

IDK how Takehuchii and ASV are about it since most of those dont have their own financing options. Like Cat and Deere do.

Going with a kubota svl 95 with a fae head now. Were trying takeuchi but having trouble with their financing.

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