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Q&A Forum

Small Business Loan

Anonymous
(Director of Finance) | Oct 11, 2016

Reaching out to you for your expert opinion on the below situation:

I am a 10% stakeholder on a business I helped a couple of friends with a few years back. The business is doing very well. Recently my friends mentioned that they are looking to obtain a small business loan, which will be used to make an acquisition which will drive revenue up. I have cash in the bank and am interested in loaning a portion of the money out. The loan term will be 3 years and the estimated interest is between 5-6%. Is that reasonable? I am also thinking of opening an investment company, which will be owned a 100% by me and my spouse. We both have full-time jobs and both our earnings will roll into that company going forward.

What do we request as collateral? Ideas?

What are best practices in a situation like this?

Thanks in advance.

Answers

Steve Sheridan
Profile
Title: Associate
Company: Dean Lewis Associates
(Associate, Dean Lewis Associates) | Nov 2, 2016

What type of corporation is the business?

Topic Expert
Wayne Spivak
Profile
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) | Nov 2, 2016

Regardless, the other owners need to issue a PG.

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