Wednesday, April 10, 2019

Choosing a Self Employed Loan

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Bill likes to work on cars.  He's really good at it too.  His family and friends are always bringing their vehicles to him when they need something repaired.  So one day Bill gets the bright idea to open his own auto repair shop.  He has a little money saved up and has his own tools, so he thinks starting his own business will be easy.  

So Bill goes out and finds a nice building to house his business in.  He takes the money from his savings and buys it.  Then he discovers he needs to do some renovations.  He needs an area for his customers to wait while he's working on their cars.  There is no space like that in his new building. He needs to install lifts for the vehicles so he can safely and easily do work underneath them.  He needs to install air compressors for the air tools and the electrical wiring needs to be redone.

 
Bill checks the balance in savings account.  He can afford to do some of the needed renovations, but not all.  So what should he do?  Should he redo the wiring and skip the waiting area and lifts?  People might not want to leave their car with him if there is nowhere for them to wait while he does the simple repairs that do not take long.  And he really needs the lifts because simply using jacks is not as effective.  

Bill considers asking his brother Joe to become a partner and help with the expenses.  But that would mean that Bill would be giving away part of the control of the business.  He doesn't want a partner, even if it is his brother.  So he rejects that idea.  

Then he thinks about applying for a loan.  He's always seeing the ads for various banks offering loans.  In fact, there's a bank right across the street from his garage that advertises on TV all the time.  But what kind of loan should he apply for?  He could mortgage his house, but he doesn't like that idea at all.  And his credit rating isn't exactly perfect.

Then he sees an ad for The Associates Home Loan of Florida, Inc.  They are offering a different kind of loan.  It's called a self employed loan and it sounds very appealing to Bill.  He goes to their website and the first thing he sees is "5 Reasons Self Employed Loans Are For You."  

The first reason is that they don't ask for your Bank Statements.  Bill thinks that is nice because he doesn't like the idea of someone seeing all of his financial transactions.  They will still need to see your credit history and tax returns, but that doesn't feel as invasive as giving them a bank statement.

The other reasons listed are quick access to capital (which is needed), a variety of providers, credit building potential (even someone with less than perfect credit can get a self employed loan if they provide enough information showing they will be able to repay the loan...and repaying the loan will improve their credit) and retaining control of the business.  By getting a self employed loan, Bill won't have to take on a partner, and that will allow him to remain in full control of his business.  
After much thought and consideration, Bill applies for a self employed loan.  Once approved, he receives the money he needs to complete the renovations on his garage and starts his auto repair business.             

3 comments:

  1. Sounds like Bill made the right decision getting a loan. It's good to know there are these kinds of options available.

    ReplyDelete
  2. I had no idea that these kinds of options were out there, but it's awesome that they are! Definitely something to look more into, thanks for sharing!

    ReplyDelete

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