Most start up businesses struggle with funding, leading many entrepeneur to leverage against their home mortgage to fund their business. Recent conditions however have seen foreclosures increase, and many people forced to sell their homes for less than ideal amounts. This can have a 1-2 punch effect if your business line of credit is also secured against the property and I'm trying to get a feel for how widespread this issue is.
Did you fund your business by leveraging your mortgage?
ChristineL | Former Moderator |
1/25/2010 - 9:06 am
Read more about financing your business in the following blogs:
I'm Applying for a Loan. How Do I Know if I Have Enough Collateral?
Understanding and Expanding Cash Flow
Grants & Loans: Break Through the Myths & Find the Right Financing for Your Needs
There are easy ways to use retirement funds like IRAs or 401(k)s to fund your business without the tax consequences. You can convert your retirement account into a trust then require the trust to invest in your business.
Keep in mind that Iam not a CPA and before doing anything like this - talk to your CPA or attorney.
In regards to using your home equity for a business line of credit - everything involves risk and market risk is the hardest to predict. Sometimes you just have to take a chance and if things don't go smoothly in your favor - you just have to work harder at it to make it work.
danva | Performer | 1/25/2010 - 3:39 pm
ChristineL | Former Moderator | 1/25/2010 - 9:06 am
phanio | Contributor | 1/30/2010 - 9:20 pm
Join The Discussion
You must be logged in to join the discussion. If you already have an SBA Community account, Log In to join the discussion.
New users, Register for a new account and join the conversation today!