Business Finance - likely?

tryingmybestt

I'm starting a business in construction with one other...

Both of us have experience in the industry, I have nearly 10 years experience, ending in me becoming a director and the other guy has 10 years + running a sole trader.

I'll be leaving my job and the other guy will be closing down his sole trader and we will start a limited company

we will do a business plan etc. but how likely are we to get an overdraft of day 25k???????

we both have a proven track record and there aren't huge set up costs

antoinolachtnai

Firstly, when you say overdraft, will you be able to clear the overdraft once every month (or whatever your business cycle is)? If not, then you are not looking for an overdraft, but a term loan.

Do you have any security to put forward? Are you bringing money to the table? Do you have signed, or almost signed contracts?

Even with this, I think it will be tough to get this overdraft. But you really need to ask the bank.

Tangled

1. You will need a really strong business plan with market research and projected cashflows and be able to put your case across.

2. I've heard that Bank of Ireland are actively looking to lend to businesses at the moment.

Best of luck with it!

NomadicMe

If the concept is strong, the plan good and the team competent, most banks will be open to helping. You could also look at other options though, such as Enterprise Ireland, if there is an export element/ Local boards (county enterprise boards) or maybe angel investors?

tryingmybestt

antoinolachtnai wrote: »

Firstly, when you say overdraft, will you be able to clear the overdraft once every month (or whatever your business cycle is)? If not, then you are not looking for an overdraft, but a term loan.

Do you have any security to put forward? Are you bringing money to the table? Do you have signed, or almost signed contracts?

Even with this, I think it will be tough to get this overdraft. But you really need to ask the bank.

we will require a term loan and an overdraft

i was thinking of 45k for the term loan over 2 years and 15k for the overdraft

the two directors have a proven track record and a solid business plan

the company doesn't have contracts ready to be signed yet but that will happen over the coming months.....should we wait until we have contracts signed before we ask for a loan?

what's a typical term load, what is typical amount for new business, duration and interest rate??

Chet Zar

If the costs to set up are low, possibly the work involved in getting set up is too? Would you not keep your job until you see how the new venture goes?

BOI do seem good for new businesses and SMEs!

tryingmybestt

Chet Zar wrote: »

If the costs to set up are low, possibly the work involved in getting set up is too? Would you not keep your job until you see how the new venture goes?

BOI do seem good for new businesses and SMEs!

set up cost are low, the other partner has existing sole trader so has most of the equipment etc. already...

i cant keep job as rival business and i'm a director of my current company

antoinolachtnai

Interest rate would be 10 to 15 percent. Might be different. But if you are bringing no money to the party, and have no security to offer, I think it will be tough. I would talk to the bank for sure, but I wouldn't be planning on drawing anything down until contracts are signed if I were you.

It is going to be very difficult to get bank funding for a construction business. The bank is trying to avoid writing off loans to construction businesses every day of the week.