Can't Secure The Finance For Your Business Start-up? Then Have You Considered Remortgaging?

Many people who want to set up their own business face the difficulty of finding funding to do so

. Granted that many business ideas require little money to start out, however some business ventures have a substantial outlay required, and this can be an issue for many hopefuls.

Overtime, it is likely that you will have built up equity in your property. Your equity is the difference between the mortgage that is secured on your home and the market value of your property. You are particularly likely to have a decent amount of equity if you have paid your mortgage for a number of years or you have been in your home for a long time.

Some people use this equity in order to afford a bigger mortgage to own a larger property later in life, as owning a huge home is an aspiration for many people, especially those who intend on having a family.

For example, you may want to open a new shop. You have a great idea for a retail venture and the perfect retail premises have become available. However, you may not be able to obtain an unsecured loan big enough to buy the property or at a low enough rate that it makes the business commercially viable.

Of course, you can remortgage your property in order to use that equity that is locked up in your property which can allow you to start the business you've been dreaming of. You do need to be aware however, that your home is at risk if your business doesn't take off as you'd expected.

When deciding to remortgage it is crucial that you have a good idea that your new company is going to be profitable. Whilst you can never be 100% sure that a business will take off, remember that if it doesn't, it's your home that is at risk. If you can't afford your mortgage repayments you may end up losing your property.

It is never advisable to start a business venture unless you have enough money behind you to pay for 6 months outgoings without any income. If this is not possible, you may need another income source as security for the first few months.

Secondly, if the business is successful, how much debt will it have to service? Is the business likely to be able to grow in order that your profits are not simply ploughed into repaying the loan that you took out to set it up? If not, you may find that you are working hard simply to repay the additional debt you took on when you set up your new enterprise.

Making sure that your home is safe should be your primary objective. To this effect, it is vital that you control the risks inherent in setting up a new business. Make sure you work out your costs carefully so you're not faced with unexpected charges and that you reduce the cost of overheads, stock and raw materials as much as you can. If you don't, you may find that your home is suddenly at risk as you can't manage you mortgage repayments.

Getting professional advice can help you to ensure that you are making the right decisions and have thought your plans through thoroughly before you take action, so consider investing some money in this before you make any final decisions.

by: Howard Ogollegos

POST COMMENT

Enjoy A Fun Filled, Fabulous Photo Shoot With Fyeo! How To Make Homemade Carp Fishing Baits For Beginners Part 2 Factors To Consider Before Buying Cheap Pink Laptops What Are The Different Types Of Accessories For Cutting Cigars? Tips On Matching Your Personal Style To Your Chicago Property Shop Online For Great Deals On Ex-fleet Vans Things You Should Ask An Seo Expert Get Herbal Food Supplements For Healthy Life Travel Trailers: Tips To Consider Before We Buy One Draw Realistic Animals: A Gift That Keeps On Giving An Effective Epos System Glen Hooke's Formula 1 Lotto System Evaluate Refilling Your Old Printer Cartridges With Printer Ink Refill To Save Money