RebeccaOh

Hi there - I'm in the process of purchasing an existing tanning salon in the Seattle area; I finally finished my business plan and had a friend who used to work for the SBA look it over and she says it's amazing; so my next step is to go to the bank for my loan...I am completely new to this, and was wondering how the whole loan process works (do I just walk into my bank and tell someone I have a loan proposal? when I bring my business plan in, does someone sit down with me right there and read it with me, or do I just drop it off and they get back to me?, etc) I really have no idea how this works and I would love some feedback so I'll know what to expect. Thank you so much!

eileen

Does your friend still work in that type of business? Normally there are certain banks looking to build their portfolio more agressively and they could ask around to find out for you. If you get that information that will help then you just call to make an appointment with a small business loan officer to go over your plan and tell you what you need to do next.

__________________
"under exposure to UV rays is as dangerous as overexposure....this is D life" eileen

unity

Yes. Call and setup an appointment. I only work with banks that deal primarily in business loans. The one I work with is an investors bank. There is no committee. All I do is setup an appointment and go in and sit down with the person I am borrowing money from with the bank being the institutional "front". Its that person's decision, not the banks and I have my money within a couple hours.

With regular banks they will want lots of collateral and will take their time. Generally they meet once a week in committee to openly discuss which loans to approve.

__________________

RebeccaOh

Unity - can you name some investors' banks for me? I was planning on going to my bank (BOA) because I have a good relationship with my personal banker, but it sounds like that may not be the road I want to go, huh? I don't own a house or anything that could be used as collateral; the only thing is, the current salon owner said he would write on paper 20% to make it look better on my part for banks...thank you both for your help!

unity

The investor banks I deal with only work with local businesses. If you credit score is great then collateral will be less of an issue.

If you call a business loan bank, be as professional and upbeat on the phone as possible Be prepared to answer ANY question. Such as the profit margin, the square footage of the building, etc...

I suggest talking to other local small businesses. Day Spas and hair salon owners are the most open to give advice. Really, talk to anyone who is a small business owner. Someone should have a suggestion for a bank to go with.

However, if you have a good relationship with your current banker it would not hurt at all to try them first. I often pursue several banks at once. Whoever crosses the finish line first gets my business!

__________________

capetan

If you have a good relationship with your personal banker if they can't help they would probablly be able to steer you in the right direction within the private financial sector if they are active in their community which most bankers are. Also the advice of talking to other small business owners is good just use caution in what ideas and such that you have within your biz plan so it doesn't help them do what you are trying to do, not all nice people remain nice.

eyecandytanning

I tried to get a biz loan with no collateral and was denied. Even with a kick *** credit score and biz plan. Decided to pay cash instead.

__________________
"Well-behaved women seldom make history." --Laurel Thatcher Ulrich

Steve Underhill

When applying for a loan you must be patient and not easily frustrated. Just because one bank turns you down don't give up. You must have at least 30% liquid funds for a down payment and be a home owner. Sometimes it can take contacting as many as 6 banks before you find one that will give you a loan. Remember you are one of many people applying for a loan and can easily get lost in the shuffle. At least 95% of my clients end up getting funded by SBA. Hang in there. If it was easy to get a business loan everyone would own their own business.

sunsally

This is your answer - you will not get an SBA loan, and very unlikely to get a bank loan of any other sort as a new start up, in tanning, with no collateral. But since you have a good relationship with your personal banker, give it a try anyway.

If not, see if the owner will finance it. You pay them over time, from the profits of the business. If there are profits, and they want to sell, this is often something they will consider.

__________________



Ann Wiggins Noe
VP of Leasing

anoe@highlinecapital.com

Direct line - 720-562-0450

RebeccaOh

so is that the case (with collateral) if I'm purchasing a successful existing tanning salon? the banks are still going to need collateral from me? or could i even use the salon itself for collateral?