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Investment loans to new business owners

Discussion in 'Business & Startup Investing' started by nitro-nige, 12th Feb, 2010.

  1. nitro-nige

    nitro-nige Well-Known Member

    8th Mar, 2007
    Reservoir, Melb
    I'm looking at leaving my current job and starting out in business for myself.
    We (my wife and I) are also looking at buying an IP.
    Do the banks have rules and criteria on how much they will loan new business owners for investment and when?
    I'm thinking maybe we should buy the IP before I quit.
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    9th Jun, 2005
    Sydney, Australia
    Yes, you will generally need to show at least 2 years of business earnings to prove your servicability for the loan.

    I'd suggest buy the IP first. Will you have enough money also adequately fund your business? Most new businesses fail due to a lack of capitalisation (ie. they run out of money before they become profitable)