Question:

How can I (22 yrs old) get a small business loan?
I'm 22 years old with average credit. I have a $14,000 car I could use as collateral. I would like to open up a bar and the expenses are going to run me around $150,000 - $350,000... Obviously with no track record in business other and a bachelors degree I'm going to have to figure something out in order to get this large sum of money. Any suggestions?

Answers:

A-Best: A small business loan, with or without the insurance from SBA is mainly relied on your relationship with the lender you choose. 22 y.o. with $14K depleting asset is not a very good collateral. For short, may I suggest you: * find a wealthy partner: you do the dirty work, the hard work + your brain + your business savvy + ++ and the wealthy folk (s) put out the money; you take a minor share of the business since the risk is on your performance and the money spent. * make sure that contract is written, witnessed, notarized that you have the first right of refusal and the option to buy in more shares for free or for a small fee if you meet or beat the performance goal. * come up with a nice, well written, well edited but simple to the point BUSINESS PLAN *In fact must be done first* * come up with a one page but legal binding terms Non Disclose Agreement (NDA); and investor or anyone who wants to hear what you will do must sign the NDA with witness. * cut your hair nicely, dress up business-like, shop for people who have money burning holes in their bank pockets. voila` : more realistic approach, doable, been there done that. Best of luck!  

A: find someone to Co-sign for you maybe parents or a rich friend with outstanding credit.  

A: a well established silent business partner?  

A: You are not going to be able to get financing from normal "banking & financing" sources. Your lack of experience and the failure rate for restaurant/bars precludes lenders from even entertaining your ideas. You need to realize that banks are adverse to risk. Your business with no experience is very risky. Offering a $14,000 declining value asset as collateral for a $150,000-$350,000 loan shows that you have more to learn about financing. This is not meant to demean you, its just a fact. Starting a business with no track record or experience doesn't make sense. What would make sense is working in such an environment for some time. Developing a business plan which includes proforma financials & marketing strategy will go a long way to finding financing for your project in the future.  

A: 1-actually work at a bar for at least5 years including as manager 2-write a business plan 3-save every penny you can, because no one will lend you 100% for a risky business like a bar 4-take some business courses so you can convince any future investors/lenders you know what you're doing from a behind the scenes point of view regarding accounting, taxes, etc