It's one of the first questions every entrepreneur asks themselves - where am I going to find the funding for this incredible business idea? According to Tom Slater, a Loan Officer with American Home Mortgage, your home isn't just where your heart is, it may be where your startup funding is as well. If you have equity in your home, taking a loan out on existing equity should be part of your funding equation. It takes about 10 minutes to fill out the paperwork and a home equity loan can provide serious flexibility, because the only investor you have to answer to is yourself.
A few points to consider as you contemplate a home equity loan for funding:
Buying a home was your first savvy investment. Let your small business be next!
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Additional details from Tom Slater, Loan Officer at American Home Mortgage
Applying for a Home Equity Line of Credit (HELOC) or a second mortgage is a simple process. I can verbally complete an application over the phone in less than 10 minutes. Once we've retrieved a credit report, that information allows me to calculate a clients "debt to income" ratio so we can make sure they can afford a loan. We also need to establish the value of the property being used as collateral, so an appraisal would need to be done. I schedule an appointment with a client and an appraiser. Once we have determined the value of a home, or the equity within a home, we can calculate how large a line of credit will be available. The entire process from start to finish can be completed in less than 10 days, and entrepreneurs know that time is of the essence.