Getting Loans for Your Home Business.Very few people

Getting Loans for Your Home Business.
Very few people can afford to start a business using nothing but the money they've got lying around in their bank accounts. For most of us, we're going to need to get a loan before we'd have anywhere near enough money to invest in starting up.

Your Credit History.

You might not have realised that your credit history was going to count here, but it does. This is where all those late credit card payments come back to bite you. The better your credit history, the more likely a bank is to lend you money, and the better the rate it offers will be.

Bank Loans.

Banks usually have someone whose job it is to go through applications for business loans. These people have seen a thousand business plans, and they know what they're looking for.

Take along all your plans and any other supporting material you can put together. Make sure you present yourself at your most professional. Act like the most sensible and level-headed person you've ever met. This is, essentially, a job interview: the bank is interviewing you and your business to try and figure out whether it would be a safe place to put their money. Remember that they're just like every investor, lending you money with the expectation that they will get it back, plus interest.

Secured Loans.

Of course, you'll probably have a much easier time persuading a bank to lend you money if you put up something of your own as collateral in case you can't pay the debt back. Some dodgy banks would really like you to secure your business loan on your house, since they know that the failure rate of start-ups is high and they'd really like to get their hands on it. Be cautious, in case you sign your life away. It is almost never worth starting a business if you can only get secured loans - you're tying the business' fortunes too closely to your own.

Government Loans.

As part of the push to support small businesses, there are now many government bodies that will offer no-interest or low-interest loans to small businesses, a category which includes home businesses. The government lot will obviously be even more picky about your business plan, but it's still a good option to have available to you. Even better, these loans will often come with free help and advice from the agency that issues them, as well as all sorts of booklets and leaflets telling you the technical details of getting started.

Credit Cards and Overdrafts.

These forms of debt are a very bad idea. Whatever you do, do not finance your business with personal debt. You'll have to make a massive profit just to pay back your debts, and it's unlikely that you'll manage to both pay them off and have enough money to live. If you can't get a loan, try to find other investors instead.

Friends and Family.

Friends and family can be a surprisingly good source of loans to help start businesses, especially if they're in the same industry themselves - they'll be more than happy to help you get a foot on the ladder. You might be able to persuade someone to give you the money at a good rate of interest, or even to act as a 'sleeping partner', financing half of everything while leaving you to run it all.

Be aware, though, that many friendships and families have been ruined by failed businesses. I had a friend who went around raising thousands from everyone he could think of to start a magazine of his own, only for it to crash and burn by the second issue. Be warned.

Keep Trying.

If you get turned down for a loan, keep trying (preferably at different banks!) You should revise your business plan each time, and try to get as many people as possible to read it - the more people who see it, the more ideas and suggestions you can hear. If your credit rating is fine, then the problem has to be with the business plan: fix it, and you're set. Good luck.


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Getting Help and Advice on Starting a Business.When

Getting Help and Advice on Starting a Business.
When you want to start a home business, it can be easy to feel alone, confused, and scared. The chances are that you don't know anyone else who's ever started a business, and you don't even know who to ask if you get stuck. Here are a few things you ought to be looking at.

The Internet.

The Internet is a great resource for people who are thinking of setting up a home business - as well as all the articles you can find with practical advice, there are also many forums, where you can read about others' experiences, and ask questions.

The Government.

Scary as it might seem to be getting advice on anything from the government, most governments go really out of their way to produce all sorts of easy-to-understand material on starting your own business. Encouraging you in business is a great way for them to both strengthen the economy and increase tax revenues.

Depending on your area, you might find that local government agencies are also keen to give you help and advice, and might even have some kind of 'small business centre' that you can visit.

Mentors.

Mentors are usually volunteers who think it would be nice to offer local businesses help and advice. They often have years of business experience, and can be really useful - if you find one, hang on to them.

Librarians.

Always willing to help and sadly neglected in our 'wired' age, you really should talk to a librarian. Libraries generally contain all sorts of business books and resources that they'll be able to point you towards, and they'll be more than happy to do research into obscure areas for you.

Lawyers.

Pricey as they might be, lawyers know all about starting businesses - they've almost certainly done it thousands of times over. It can be well worth paying for an hour of a lawyer's time and just asking them every question you can think of.

Accountants.

A less expensive alternative to lawyers, accountants also know their stuff, especially (obviously) on the financial side. If you want your business to be profitable, you should take on board what your accountant tells you - and if you don't have one, you should get one. By the time they've helped you navigate through all the tax mazes, they'll almost certainly have made their fee back for you anyway.

Incubators and Investors.

If you think your business would be an attractive proposal to people who back businesses for a living, then you can try going to a 'business incubator' or some other kind of investor with your idea. If they like it, they'll often have a quick process set up to get your company up and running as soon as possible.

Universities.

Here's an interesting one: universities are full of business students. They've all spent ages learning about nothing but business, and many of them would just love to help get a real one off the ground - it'd look great on their CV, after all. Business students can be a great source of free help and advice, and they'll probably even be thankful to you for letting them help out!

Teachers.

If you do a course to get a formal qualification in what you want to do before starting the business, you'll probably find that your teacher is also a good resource on the business side of things. They'll have had plenty of students starting businesses who've asked them similar questions, and they might even have prepared some material to give to anyone who asks for it.

Your Bank.

Traditionally, your bank would have been the first place you went if you were thinking of starting a business, but many people seem to ignore them nowadays. While they're no replacement for accountants, most banks will offer you a 'business advisor' when you open a business account, and they can be especially helpful with the technical and financial elements of starting up.

Associations, Societies and Unions.

Whatever industry you're thinking of entering probably has some kind of trade association, society or union. You should join as soon as you can, and take advantage of all the resources that they will almost certainly offer to people wanting to get started in their industry. After all, the more people who are in their industry, the more members they can get.

So you see, there's no shortage of advice out there if you look for it.


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