Where can i get a loan to start a business and refurbish a house

[depadepo]

Hi All,


I'll try and keep this short to the point.
Young professional, graduated 2012, been working for one and a half years now.
I want to get a loan to start a small business, R500k should suffice and at the same time I want to refurbish my mom's house (in the townships) no more that R750k. So I need R1.25m cash that I will manage myself.
I don't want to get two different loans for obvious reasons.
I am new to this topic so if there are threads or sites where I can get assistance, please comment with links.
Thanks

 

[Nerfherder]

Best to get a job first.

You might be able to find someone that does start-ups for people in your situation but even they will be looking for some work experience.

 

[depadepo]

Best to get a job first.

You might be able to find someone that does start-ups for people in your situation but even they will be looking for some work experience.

Get a job first?
I have a stable job.

 

[paul5186]

To get a loan for that amount in your name you would need to be earning more than 30k a month. A business loan is totally separate and should be treated as such.

 

[depadepo]

To get a loan for that amount in your name you would need to be earning more than 30k a month. A business loan is totally separate and should be treated as such.

Fair enough... But don't you think it would be ideal to pay off one loan instead of two? And also banks might not be keen on the business due to the nature (nothing illegal) and location. Not to mention how long it'd take for the business loan to be approved.

 

[IzZzy]

Get a job first?
I have a stable job.

The easiest - personal loan.

What security can you offer? When you say refurbishment, do you mean building upgrade or new stuff for the house?

 

[Stokstert]

Daydreaming?

 

[creeper]

FFFs - Friends, families and fools

 

[hellfire]

The easiest - personal loan.

What security can you offer? When you say refurbishment, do you mean building upgrade or new stuff for the house?

No way, not for R1.25 million. The interest would be ridiculous.

In terms of business - do you have a proper business plan? If not, that's step one. Then you can start trying business bankers (phone your home back to find out which branches offer this).
They may well want collateral or someone to co-sign with you to reduce the risk...

 

[IzZzy]

No way, not for R1.25 million. The interest would be ridiculous.

In terms of business - do you have a proper business plan? If not, that's step one. Then you can start trying business bankers (phone your home back to find out which branches offer this).
They may well want collateral or someone to co-sign with you to reduce the risk...

I did say the easiest. Obvious ease comes at a price. OP's question didn't relate to price, but how to structure it as one loan.

No bank will grant a home loan (for the refurbishment) in excess of property value, and no bank will grant a business loan in excess of the amount required. Ergo it is not possible to combine both in one loan as per OP. The only way how is to take a personal loan.

 

[^^vampire^^]

Sorry but to be blunt this is just stupid.

Doing up a house for R750k - the house better be worth at least a few mill and the bank is never going to hand this over to someone with little employment history. In fact I'm willing to put money down on a bet that they will laugh at you for bringing this up. I really doubt you earn enough each month to pay this back alone. "refurbish my mom's house (in the townships) no more that (it's than not that) R750k" - Just the way you go about asking these questions shows you have put little to no thought into this at all. Did you wake up this morning and think "hey, let me get a huge loan to buy some cool **** for my moms yo!"? Never mind the amount of time and money it would take to pay back a loan like this.

Let me put it into perspective. The cheapest type of loan you will ever get is a home loan. My home loan is now sitting at 8.75% and it is for R544 000.00. I pay back on that R4800.00 p/m. a personal loan will likely be in the range of 20%-40% meaning you will be paying a hell of a lot more than R4800.00 p/m just on R750k.

You've barely just entered the workforce and already you are doing the dumbest thing possible by trying to rack up a maximum amount of debt in the shortest space possible. Go to work, save your money and when you can afford to, do some mods of your moms place or buy her some furniture. If you don't have the cash on hand you can't afford to buy stuff - end of the story! Personal finance is a very simple thing, don't spend more than you earn. It's the biggest problem with everyone now and the instant gratification culture. Do yourself a favour and get these ideas out of your head now. Maybe you feel like you owe your mom something but I'm sure she will appreciate it more in 20 years time when you can get her something nice while driving that BMW you paid in cash for. Imagine if you lose your job tomorrow - how do you plan on paying back R1.25m?

I doubt you have any kind of constructive business plan together either. Contrary to popular belief "I want to get a loan to start a small business, R500k should suffice" will not fly with a business loan banker. If you had done the proper planning you would already know exactly how much you need. Don't tell me you have a business plan already because just by saying R500k should suffice I can tell you straight off the bat they won't even entertain what you've written. Trust me on this one - I used to work for people that gave out business loans and bought businesses for a living (venture capitalists).

 

[Batista]

I suggest you go into your bank and speak to a consultant.You need to think clearly about what you are trying to do.

 

[cenredash]

Hi OP, the best thing you can do is heed vampire's advice (rather than his tone).
Apologising for being blunt doesn't give the right to insult. But what he said is sound.
Based on the information you've given, other than people that have very little appreciation for their money, you won't be able to get a loan from a reputable institution.
Save first, then buy. Going into debt to get anything but the necessary is financial suicide.
Other than that, good luck with your venture!
CA

 

[^^vampire^^]

Hi OP, the best thing you can do is heed vampire's advice (rather than his tone).
Apologising for being blunt doesn't give the right to insult. But what he said is sound.
Based on the information you've given, other than people that have very little appreciation for their money, you won't be able to get a loan from a reputable institution.
Save first, then buy. Going into debt to get anything but the necessary is financial suicide.
Other than that, good luck with your venture!
CA

The reason for my tone is that there is such a wealth of financial information available to people nowadays (just on this forum alone) and clearly the OP has not taken any steps to educate himself financially on such a huge life choice. He has essentially gotten it into his mind that he would like to financially ruin himself for the rest of his life. Furthermore, if he had somehow miraculously managed to get such a loan, which would probably be through a loan shark as no bank would ever give him the amount he wants, if he defaults on this loan not only would he be in huge trouble but his mom's house and belongings would be repossessed.

No where has any repercussions been thought out here and this is extremely dangerous. I can't actually believe this guy has a tertiary education because of how ludicrous what he is asking is.

 

[Spliffcat]

Geeeeeeeeve me. I think this is the question.

 

[borga]

No where has any repercussions been thought out here and this is extremely dangerous. I can't actually believe this guy has a tertiary education because of how ludicrous what he is asking is.

Tertiary education can be anything from BCom Financial Management to something such as Bachelor of Arts, having tertiary education does not necessary indicate financial knowledge.

 

[ToxicBunny]

No but it should indicate a modicum of basic knowledge about the real world, and how a bank won't just give out R1.25m on some random flimsy concepts...

 

[WaxLyrical]

Hi All,


I'll try and keep this short to the point.
Young professional, graduated 2012, been working for one and a half years now.
I want to get a loan to start a small business, R500k should suffice and at the same time I want to refurbish my mom's house (in the townships) no more that R750k. So I need R1.25m cash that I will manage myself.
I don't want to get two different loans for obvious reasons.
I am new to this topic so if there are threads or sites where I can get assistance, please comment with links.
Thanks

the goverment could use a man of your talents.

 

[borga]

No but it should indicate a modicum of basic knowledge about the real world, and how a bank won't just give out R1.25m on some random flimsy concepts...

Not really if the amount of debt US students graduate with is any indication.

 

[midnightcaller]

Hi OP

If it makes you happy to make your mum happy by refurbishing her home, then do it. Go take a loan and make it happen. One day when your mum is gone, Don't have regrets about not doing it. Plan it carefully and execute it.

On the business, if you believe your idea can fly then do it. If the idea fails, learn from it, pay your school fees and move on.

Good luck. Hope you find the resources you need and live your dream.