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Hi there, so I'm half american half european, in my mid 20, I grew up in Europe and worked in hospitality around the world for the past 5 years, and now it's time to settle down.
I currently have an opportunity to open my own restaurant in the UK, but I'm lacking in funding, I could ask a Loan in the UK but not being a citizen there and not having any parents there, that could eventually co sign for loan, and having a low credit score, It would be quiete hard.
So Giving one of my parents lives in the US has a steady medium income, I never asked anything so I was wondering if I could try and get a personal loan or any other loan suitable for this case of 50k-100k there with my parent co-signing and use that in the UK? Will that be a right way of obtaining a Loan ? and If its even possible to do this?
I know this is a big some to repay back especially in a business start up anything can go wrong and that cash is up in smokes, however I'm a responsible person and know my limits in spending and savings.
I'm not an expert in this and if any one could give me advice on how they would do it or anything else, I would really appreciate It.
Thank you
Despite some improvements in the financial markets, lenders are generally not handing out large sums of money for the sort of proposition of which you're speaking (business or unsecured personal loans).
For a business loan, even if it were in the U.S. you'd likely need a good business plan probably including market analysis, plus probably some history that evidences you can turn a profit or at least enough cash flow to keep paying your loan.
For an unsecured personal loan? Probably not, but if at all, only with rates/fees that are likely to be not in your favor and will cut deeply into your profit margin on a budding restaurant. And they'd likely also only do it if your parent has assets with which to secure the loan, such as home equity.
If your parent is willing to co-sign a loan of that scale anyway, and has home equity, your probably better off trying to talk your parent into a HELOC, though with the knowledge that if your business goes under (and most restaurants do) you've put the house in jeopardy.
Hi there, so I'm half american half european, in my mid 20, I grew up in Europe and worked in hospitality around the world for the past 5 years, and now it's time to settle down.
I currently have an opportunity to open my own restaurant in the UK, but I'm lacking in funding, I could ask a Loan in the UK but not being a citizen there and not having any parents there, that could eventually co sign for loan, and having a low credit score, It would be quiete hard.
So Giving one of my parents lives in the US has a steady medium income, I never asked anything so I was wondering if I could try and get a personal loan or any other loan suitable for this case of 50k-100k there with my parent co-signing and use that in the UK? Will that be a right way of obtaining a Loan ? and If its even possible to do this?
I know this is a big some to repay back especially in a business start up anything can go wrong and that cash is up in smokes, however I'm a responsible person and know my limits in spending and savings.
I'm not an expert in this and if any one could give me advice on how they would do it or anything else, I would really appreciate It.
Thank you
Regardless of how you structure the loan, I suggest you work with or approach one of the big international banks:
HSBC
Standard Chartered
CitiCorp
UBS
It'll make transfer of funds and payments much easier, as they will know banking regulations on both continents and have local offices in both areas.
In the US, unsecured personal loans generally have very short repayment terms, such as 3 years. The monthly payments on 50k - 100k will be quite high. However, if your parents can qualify for that, they can certainly borrow the money and then do with it as they please.
Another option is to borrow a bunch of money on credit cards and then begin playing the credit card balance transfer game, to keep the interest cost down.
Yet another option, if they own a home and have enough equity, they can borrow against their home.
How your parents feel about any of this is another matter.
Very and many Thanks to all you for your replies, very helpful.
I will try to talk to my uk bank first and see what they can offer. I'm well aware that most restaurants fail, I've learned a few lessons there and yes it is a very risky investment, however if well played it can work out well in a good location. However thank you all again I'll figure out something out of the information you given me, where sorting out our market analyst, and finalising our business plan. Let's se how it plays out, if it has to be it would be.
Thank you all again
If you need your parents to co-sign for you, you are already in trouble and you haven't even opened yet.
Here in the USA, needing a co-signer is generally a sign one cannot afford the loan in question.
So, asking your parent to co-sign is a bad idea.
ARe you prepared to pay your parent back if it fails?
If there is no other backing available to you, perhaps best to work for someone else till you have saved the money and/or can get a private investor who believes in you, your restaurant idea, and your future.
MANY small businesses here in the USA are expected to fail within the first 3 years of being open. Many people drain all their personal resources to keep it afloat "to make it work".
Not trying to be a downer, but a realist.
And yes, if you do proceed and your parent co-signs, as suggested, use a bank with strong international ties.
Hi galaxyhi thank you for your reply and yes u are absolutely right, on the co-sign and I'm completely aware that I will have to repay it back if it fails, and have back up plans, I though of any scenario outcome, and yes I said earlier it is a big gamble.
I'm aware that many small business fail in the first 3 years, I've been part of one and opened shops for other companies, however, I think with the right mindset and location, It could honestly work, also for various other reasons involving this particular project.
However thank you again really appreciate your help.
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