Consequences of using credit facility to run a business.

[Kvngsammy]

Obtaining a credit facility to run a business isn't a bad idea because you're not taking the facility to purchase liabilities it instead creating or funding a system that would improve income flow which is an asset.
So it's not bad especially if you know what you're doing.

 

[Stnicholaz]

Wow with your field, I guess you saw alot of stories and have alot of experience. How are you able to cope with all the excuses these clients give and all that?

It get to point the stories and excuses became a cliche to me. Those difficult ones, I worked with with thier guarantors to recover the loans. That is why you must be very careful when signing as a guarantor for anybody. Because if the person can't pay or is no where to found you will be one to pay the loans or look for the person.

 

[eLdavis]

It get to point the stories and excuses became a cliche to me. Those difficult ones, I worked with with thier guarantors to recover the loans. That is why you must be very careful when signing as a guarantor for anybody. Because if the person can't pay or is no where to found you will be one to pay the loans or look for the person.

Wow, am pretty sure you came across some cases whereby you could not get the loans back, how did your agency handle such cases?

 

[Stnicholaz]

Wow, am pretty sure you came across some cases whereby you could not get the loans back, how did your agency handle such cases?

In such cases, the guarantors will be arrested and he will be forced to pay the loan or provide the person. But if its very large sum of money, arresting the guarantors most times is a waste in some cases because they cannot paid the loan.
For large sum the collateral used will be confiscated. If the value of the collateral is not enough. It will written as bad loans and the details of the person sent to AMCON. Such person can't apply for loan in any bank in Nigeria until he or she pays back the loan.

 

[eLdavis]

In such cases, the guarantors will be arrested and he will be forced to pay the loan or provide the person. But if its very large sum of money, arresting the guarantors most times is a waste in some cases because they cannot paid the loan.
For large sum the collateral used will be confiscated. If the value of the collateral is not enough. It will written as bad loans and the details of the person sent to AMCON. Such person can't apply for loan in any bank in Nigeria until he or she pays back the loan.

Wow, I have only seen such cases in movies and books, what about cases whereby the person who took the loan is dead, who pays? The next of kin? Or do they just confiscate properties?

 

[Obaterof]

Credit risk is the possibility of losing a lender takes on due to the possibility of a borrower not paying back a loan.

 

[Stnicholaz]

Wow, I have only seen such cases in movies and books, what about cases whereby the person who took the loan is dead, who pays? The next of kin? Or do they just confiscate properties?

Sincerely, I have not handled such case before but certainly the property and will be confiscated and name sent to AMCON as bad loans. As who will pay the loan like I said I did not experience such when I was working there. But I know the guarantors and family would be responsible for the payment of the loan. But in this case a flexible payment plan will be negotiated.

 

[tyrim88]

There's nothing wrong in using loan or collecting credits from loan facility, what really matters is what you are doing the business with, Most Investment you see get done are done with Loans and credit. Once you have a focus on what you want to do with the credit stick with it.

One thing about getting a loan for your business,is that one need to really have a need for the loan.Not that loan is bad,but you must have been in the business and study the terrian,dynamics and cash flow to be able to know the capacity of the business to service a loan facility.

 

[kinqzbitz]

Well loans are mostly not easy to pay off but then it helps a lot and if you have any other alternative like grants and help from family members then you should take that one Rather than loans

 

[Justin]

There is nothing wrong in funding your business with loan or burrowed money. But when you are running a business with a loan, you need to take care of a lot of things like paying back the loan in time.

 

[Sotherefore]

Generally people that should be getting a loan to start up something are those people that can still be able to pay back the loan even if the business collapses that is just all .

 

[Toyoabasi]

Using credit facilities like obtaining loan from cooperative may have negative or positive impacts. The negative impact includes if the business fails to succeed, the loan may become difficult to repay while the positive impact includes it will make us work harder in order to repay the loan.
Do you agree with my assertions or you have another opinion?

I agree with you.
That's a disadvantage of using a credit facility to run a business.
One should be certain about being able to run the business, make profits and repay loan when due. That way, you don't get to risk your business.

 

[Abasiama40]

Using credit facility to run a business can be quite challenging as there are different criteria for different business, sometimes you get less fund access than required and very high interest rate that keeps accumulating over time.

 

[btaliat]

I believe in your assertion. Borrowing money at times makes us work harder because we will like to repay the loan on time. But we must make sure that we have done the real feasibility study before obtaining loans for business to prevent loss.

 

[Good-Person]

I live in a city where many people give products and goods on credit and then they suffer when they do not give money. As a result, many store owners clearly prohibit taking goods on credit.

 

[YERUS]

Using credit facilities like obtaining loan from cooperative may have negative or positive impacts. The negative impact includes if the business fails to succeed, the loan may become difficult to repay while the positive impact includes it will make us work harder in order to repay the loan.
Do you agree with my assertions or you have another opinion?

I agree with your assertions.
It is very risky using credit facilities to run a business; if the business fails, you will still have to repay the loan through any other means, and that will be a loss on your side.

 

[Abigael]

There is nothing wrong in funding your business with loan or burrowed money. But when you are running a business with a loan, you need to take care of a lot of things like paying back the loan in time.

Yeah, it is your duty to ensure that you pay back the loan as soon as possible. Otherwise, your business will suffer the effects of the loan. If you are unable to pay it back on time, it is best to avoid such loans.

 

[Shigobad20201]

Financing your business completely with a loan is not a good idea. When you finance your business with 100 percent loan, it will be a financial burden later on. It will take time to establish your business and generate income, however, you will have to start repayment from the next month.

There are many consequences that is sirrounde by using credit facilities to run a business , most especially borrowing money from a loan sharks to start and a business and on the long run, the business did not yield a better result and your loan interest is piling up.

 

[Godspower]

I believe in your assertion. Borrowing money at times makes us work harder because we will like to repay the loan on time. But we must make sure that we have done the real feasibility study before obtaining loans for business to prevent loss.

It might make you work harder but it can also put you under a great deal of pressure. Also, the high interest rates of most loans also makes it difficult for the business owner.

 

[Kane]

If you are running your business with credit, you will have to start paying your credit long before you are earning profits. If your business cannot earn profits, you might end up paying from your pockets.