The Required Down Payment For an SBA loan is 10% and should not come from a loan, here are few options to come up with the down payment.
Get a financial gift
The down payment can come from a friend or relative.
What people usually do is: They borrow money from a friend or family member and then pay them back once they get funded.
Another option is to have a family/friend/future partner (should not be a co-owner/member) apply for a Term Loan, and use that as down payment. You can pay them back later or make them a partner.
Get a second job
Boss turned down your request for a raise? Moonlighting could help you earn the extra money. This option makes the most sense for those who are young and not fully established in their professional lives.
Sell unwanted items
You likely have some used furniture you no longer use or old clothes that are no longer in style. Sell your stuff to add a few more bucks to your down-payment savings.
Websites such as Craigslist, eBay, Facebook and Amazon can help you turn your castoffs into cash.
Tap into your IRA/401K
We do have a Program that allows you to withdraw funds from your IRA/401k to fund your business without having to pay taxes or penalties. But you have to meet specifics requirements for this program:
- They must have at least $25,000 in their IRA/401k.
- Their IRA/401(k) must be from a previous employer
Not eligible for this program if: The 401(k) or IRA has less than $25,000 and if the 401(k) is tied to a current employer.
Pay off your credit cards.
When you carry credit card balances, the accumulating interest charges make it hard to wipe out that debt. Keep that cash for yourself by cutting your debt load.