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 Establishing credit in order to apply for a business loan...
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two5tolife Offline
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PostPosted: Sat Jan 22, 2005 9:07 pm    Post subject: Establishing credit in order to apply for a business loan... Reply with quote

The SBA website is killing me. I don't know the first thing about starting a business, but what I do understand from the main information is you need to have a positive credit rating. I hear financing a car is the best way to establish credit, but I don't want to waste money on a car when I'd rather buy useful equipment. Is there another, more useful, way to establish a credit rating without credit cards?
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two5tolife Offline
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PostPosted: Sat Jan 22, 2005 9:09 pm    Post subject: Reply with quote

Oh yeah, I forgot to say, I'm trying to get ready to throw a business proposal to the SBA for a loan within the next 2 years. Thanks again!
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riverside Offline
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PostPosted: Sat Jan 22, 2005 9:25 pm    Post subject: Reply with quote

You really need credit to get just about anywhere. Thing is, you probably spend money everyday, right? My first start was to get a credit card- pick from the various offerings sent daily in the mail- look for something with no fees and a low rate. Now use that to buy the stuff you normally buy everyday- gas, grocerys, whatever. The place were people get into trouble is when they use that card to buy stuff they WOULDNT be able to buy with out it. If you are youing your credit card to finance everyday crap then YOUR DOIN IT WRONG. Wouldnt hurt to finance a car too if your in need of one- but you dont have to buy something thats is beyond your means to establish credit- you just have to pay the thing every month and dont every be late- its really not that difficult.
If you have a car now, you could sell it for an amount cash, then buy a car - using some of that cash as a downpayment, pick up a small car loan (mine through colloege was only $120 an month for a real decent used ride) then take the left over and invest it or stick it in an interest earning savings acount. You need credit but you dont have to kill your self to get. Good luck

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two5tolife Offline
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PostPosted: Sat Jan 22, 2005 9:37 pm    Post subject: Reply with quote

You've gotta be 18 to get a credit card right? Well, have an 18 + year old to sign for it? With CC interest, is that added to the bill if your payment is just late, or is it added anyway?
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riverside Offline
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PostPosted: Sun Jan 23, 2005 6:08 am    Post subject: Reply with quote

Yeah- you probably have to be 18 to have a credit card (Im not positive of this). Interest doesnt kick in unless you carry a balance. if you pay off the card every month there is no interest- some do have monthly fees regardless of whether you pay your balance- and thats what i was sayin above- find something with no fees.

when will you be 18- you may b e getting a bit ahead of yourself here. Possible the best thing you can do for yourself now is stay out of debt and start saving up some money. Start a savings acount that you dont draw from and start squirlin money away.

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Slackmaster2K Offline
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PostPosted: Sun Jan 23, 2005 1:26 pm    Post subject: Reply with quote

Basically your goal is unreachable. It'll take you a few years to establish a decent credit rating. Even then it doesn't matter because you're not going to get a substantial business loan without higher education and/or years of business experience. Plus you'd need a solid business plan and proof of the concept (i.e. your ability to make it work), which is going to be really, really hard when it comes to opening a studio. Studios don't make money and businessmen don't trust musicians. Then, even if you incorporate they'd make you back the loan personally which could totally fuck you in the long run.

I would take riverside's advice and start saving money. Work yourself up the old fashioned way. Once you've proven yourself you can start thinking about things like loans.

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two5tolife Offline
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PostPosted: Sun Jan 23, 2005 6:30 pm    Post subject: Reply with quote

Yeah, just realized I can't establish credit @ all until I'm 18! DAMMIT! My plan isn't coming together exactly as planned... I can't get a loan with out credit but I graduate when I'm 17..., I can't really save money but I can always try a little bit a month... I need another source of income, there is no way I'm gonna be able to open a legitamate business, atleast one that'll allow me to function on my own for a few months before things REALLY get rolling...


The reason this is so stressful is because I don't want to waste my time/money on a college education on something that I can learn by myself over the same amount of time. This is killing me but I've got plenty of time to decide on whether I'm gonna take the risk or not....

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Just1Ghost Offline
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Joined: 04 Aug 2006
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Location: A l'il East of Toronto, ON CANADA
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PostPosted: Fri Aug 11, 2006 7:21 pm    Post subject: Reply with quote

two5tolife,

You said: "The reason this is so stressful is because I don't want to waste my time/money on a college education on something that I can learn by myself over the same amount of time. This is killing me but I've got plenty of time to decide on whether I'm gonna take the risk or not..."

Trust me, "waste" your time, take the "risk" by getting that education!!! I'm a Studio Owner who is still struggling to make ends meet, and I would love nothing more than to be taken a lot more "seriously" than I am, and having an education WITH "papers" seems to be the way to do that... Yes, you CAN learn how to run the gear, etc. on your own, but the things you learn in the classroom FAR outweigh the stuff you'll EVER learn on your own "in the same amount of time"...seriously...

Keep on keepin on...

-G-
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