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Discussion in 'Business Operations' started by Patriots, Jul 25, 2006.

  1. Patriots

    Patriots LawnSite Member
    Posts: 185

    Looking for a little funding, and finding it difficult for anyone less than 2 years in the business. Last year we did $150,00, and this year on pace for over $400,000 - which does not matter to any local bank, all they want to know is "How long have you been in business?". I need approximately $225,000 for a facility and expansion - anyone out there have any good referrals.

  2. MMLawn

    MMLawn LawnSite Gold Member
    Posts: 3,569

    Even with the years needed in business (3 completed years with tax returns is usually the bare min with lenders) I think it is going to be hard, actually next to impossible probably to borrow that kind of money by a business that has only been in business 1.5 years even based on that the business "may" bring in a total of $400,000.00 in it's second year before payroll and expenses. Because the bank is going to see probably at least $280,000.00 of that $400K already going out to those expenses, plus they will be very skeptical of such a young business doing $150K in their first year and then jumping to $400K in their 2nd year, that kinda young growth in very small businesses "scares" lenders. That is one of the main reason they require more years in business, so that they have a "better and more true" picture of the companies financial well being. So, unless you also personally guarantee the loan with your credit and real property I doubt you'll find funding. BUT if you do have outstanding credit and some pretty healthy real property holdings then it should be a breeze to get any banker to go along with it being personally guaranteed.

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