Question Hi, I plan to open an infant and toddler Nursery in Las Vegas, NV. I need a loan of $150k. My personal credit is not the greatest, though my home has $90k equity. I dont want to do a home equity loan. If your business plan is promising and you use your home for collateral, is it possible for someone in my situation to get a loan of that size? Thank you!
Answer Dear Nichole :
First of all make sure that you have at least 20% down payment for your project.
For example:
The total project cost: 187,500
Down payment: 37,500
Loan: 150,000
You mast have experience in daycare.
You must have collateral (as you have a start-up business). The following is the formula to calculate collateral:
Collateral = (Real estate value*0.8 - Mortgage) + Equipment value *0.5 + Inventory *0.1
The size of collateral is approximate amount of start-up loan you can get.
I would not recommend to apply for a loan if your credit score is below 640 or you have BK less than 3 years old, or charge-offs, or liens and judgments, or late mortgage payments.
Sincerely,
Marina Lando
President
Business Loan Quest http://www.blquest.biz
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