Does a loan for me exist?

[RB Will]

I have never had a loan, finance or mortgage before so am new to this borrowing money lark.
I have a client who would like me to do some work for them but I would need to buy some special equipment which I would need a loan for.
The problem I have found is that loans seem to need to be repaid monthly and I would not be able to afford the repayments.
I was wondering if anywhere did a loan where I could borrow the money with a similar interest rate but I could just pay it all back in one lump at the end.

My plan was to get loan - buy equipment - do work, which should take about 8 months - get paid by the client - sell equipment - pay back loan + interest.

I was thinking along these lines as the amount the client will pay will comfortably cover the cost of the interest and make me some money but won't come close to paying for the bloody expensive equipment.

Is this a feasible strategy or do I have to tell him to get someone else to do the work?

Thanks

[boobles]

You may struggle to get a loan if you have never borrowed before.

They look at your history & to make sure you are able to pay it back & your credit rating will be to low if you don't have credit cards etc.

[purplepolarbear]

Is it possible to hire the equipment rather than buy and sell it?

[Stevenj214]

You may struggle due to your lack of credit history, but you could look at a credit card with 12 months interest free on purchases

[BuzzLightyear]

Any chance you could get some money up front from your client?

You haven't said what field this is in or what the investment in equipment amounts to but in some fields it is accepted practice to pay a deposit up front. Even if that is not normally the case in your instance you could always ask rather than just give up the opportunity?

HTH

[RB Will]

Nowhere seems to hire the equipment. I can buy it used but would still need a loan for that.
Have never had a credit card. Have a couple of debit cards and never been into an overdraft. I am a home owner if that helps.
How much would I be able to spend on a 0% credit card as I need to spend about £18k

Thanks for the ideas so far

[RB Will]

BuzzLightyear said:

Any chance you could get some money up front from your client?

You haven't said what field this is in or what the investment in equipment amounts to but in some fields it is accepted practice to pay a deposit up front. Even if that is not normally the case in your instance you could always ask rather than just give up the opportunity?

HTH

It's an idea but it won't work. I would be spending about £18k on equipment but the client is only going to have to pay about £8k for the work. This is not enough to pay the monthly instalments. I have no other clients who wan't this work done an am unlikely to get any more that do so don't want to take a gamble and go for it in hope.

[boobles]

Very much doubt that anyone will offer you 18k.

[BuzzLightyear]

Guess I'm probably missing something but can't see why you would want to spend £18k on equipment for a one-off job with a return of £8k, even allowing for the possibility of getting some of your investment back on re-sale of the kit.

That aside, I agree with the posts which suggest you might have considerable difficulty borrowing a sum like that but if you decide to go for it anyway, good luck

[RB Will]

BuzzLightyear said:

can't see why you would want to spend £18k on equipment for a one-off job with a return of £8k, even allowing for the possibility of getting some of your investment back on re-sale of the kit.

I know it sounds silly but it means roughly £4k profit after interest, depreciation and tax for about 8 hours work

[Stevenj214]

RB Will said:

I know it sounds silly but it means roughly £4k profit after interest, depreciation and tax for about 8 hours work

8 hours or 8 months as per your OP?

[steve2]

8 hours work over 8 months?
if your equipment costs £18k do you think you will get over 50% back at resale?

[Defcon5]

Just how expensive is this equipment? You say you own your house yet have never had a mortgage - would it be pratical to release some equity in your house to buy the equipment?

[RB Will]

The client will be sending me items for testing once a month for 8 months. Each set of tests will only take about an hour.

Amazingly the equipment does hold it's value very well as there is not that much of it around even 10 year old stuff is still about 70% of the original price.

I do Own a house. Inherited a fully paid off one (lucky git I know, it's no mansion but it will make a good deposit for a proper home one day). Do companies give mortgages for as little as £20k? As I dont want to have to pay back a £50k mortgage if that is the minimum.

Sorry for being so confusing and thick about all this.

[R11ysf]

Well how much does it cost to sub-contract the testing work? Surely you could go to one of these companies and ask if you could use their equipment for an hour a month??

As above, spending 18k for something that only generates 4k of profit doesn't seem in anyway worthwhile to me. Even if you "sold" the work to another company and got £1k introductory fee for doing nothing seems more worthwhile from a business perspective.

[RB Will]

I will look into sub contracting. I don't fancy introducing them to someone else as I will probably lose all their work then.

[kazste]

Seems to make sense if the equipment holds its value.well, but would be even bigger profit margins if you could buy used equipment for.70% of list and then sell it after for 60% list. This would mean more profit for yourself, lower loan level, and potentially a quicker resale as the equipment will be hardly used compared to a year ago yet you'd be able to sell it for less than equivalents.

[christer]

kazste said:

Seems to make sense if the equipment holds its value.well, but would be even bigger profit margins if you could buy used equipment for.70% of list and then sell it after for 60% list. This would mean more profit for yourself, lower loan level, and potentially a quicker resale as the equipment will be hardly used compared to a year ago yet you'd be able to sell it for less than equivalents.

+1

I am also struggling to see the risk/reward benefit here - what if your one client in this area goes bust in the next few months?

Good luck in any case!