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Old 02-06-2012, 07:56 AM
 
Location: NJ/SC
4,299 posts, read 13,757,768 times
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Probably doing a home equity loan for business.
Does it matter what we spend the money on to the bank and do we have to tell them it's for business? Or do they expect it only to be spent on the home?
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Old 02-06-2012, 09:24 PM
 
Location: Marion, IA
2,796 posts, read 5,659,896 times
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Nope, bank doesn't care as long as it is legal and they know about it. Keep in mind if you are supplying a financial statement to them that the amount will need to be deducted.
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Old 02-09-2012, 10:45 AM
 
Location: Palo Alto
12,152 posts, read 7,489,765 times
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Quote:
Originally Posted by Rapture View Post
Probably doing a home equity loan for business.
Does it matter what we spend the money on to the bank and do we have to tell them it's for business? Or do they expect it only to be spent on the home?
I'd advise against any kind of loan that puts your home at risk. We had mortgage our home years ago for our business, and it worked out well. The business and banking environment has changed drastically since then. There are stories of banks foreclosing immediately on loans, which they are entitled to do. You could be a month behind and lose your home.

I'd look at the SBA programs or similar first. Discuss your business plan and assumptions with a good CPA first. Run the loan terms past him/her as well. Prepare a detailed, monthly cashflow statement for at least three years. If you can get past the first few years you have a good chance of success.

Don't want to scare you off - owning a business is the most rewarding thing I can imagine. Just know the risks before you sign.
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