Phil Marcoux ⋅ Mountain View, CA PPM Associates ⋅ 40 years experience

Dena, the type of business you propose is basically a secured lending operation. Your business' mission statement will read "I can earn much higher returns on invested capital than banks currently offer." What this means is that you loan someone equipment/furniture,appliances, etc. and they pay a monthly fee. Since your terms allow for them to earn the right to own the stuff than their monthly payments are a combination of interest and principal. Given the loan's risk, short term, and other factors you should be able to charge interest rates approaching credit card rates - approx. 20% but with the added feature of including some principal payments.

To me your best bet for financing would be private funders. Several local real estate agents probably have investors they work with who provide what are called "silent seconds" to prospective homebuyers so they have money for deposits. These investors provide short term loans (1 to 2 years) at rates above high risk loan rates ( maybe 12 to 15%).

The other thing you'll need to do is get good terms with your product suppliers. Most will want you to buy with cash and no credit. The cash flow mismatch this creates for you will kill the business.

If you set up a good credit screening process and demonstrate that you can keep customer delinquencies and defaults low than I think you have several private investors calling you.

Good Luck

Bryan Pigott ⋅ Chicago, IL IBM ⋅ 15 years experience

Dena - thank you for your service! You should also take a look at HUD, they have a number of programs that are designed for rehabbing rental units, holding for a period, and then you could convert them to for-sale and provide rental credit of some kind off the price. You will need to provide some start-up capital of your own, as well as put together a detailed business plan. Best of luck!

Jenny Bulfer ⋅ Waseca, MN Satis, llc ⋅ 8 years experience

Have you sought any assistance through the SBA (Small Business Administration)? They are a government agency created to help small businesses grow. You may qualify for a loan through them. They typically loan half the amount. With half the loan is secured, your bank may feel more comfortable loaning the other half.

George Oestreich ⋅ Fort Lauderdale, FL First Service Residential ⋅ 40 years experience

Dena: I believe that you will find credit scores and experience will be two huge factors when trying to start a business unless you explore a franchise which will require funding. You mention your credit is fair, try to spend some time getting the score into the mid to upper 700 and perhaps while building your score work for a RTO company to gain inside experience.
Thank you for your service to our great country. George