Loan to buy out Round

Just been asked if I want to buy out the round in currently working on as a sublet. 
For context the round is big full months work in the summer, struggle to get round in the winter. 
At the moment subbing I’m making enough cash but not exactly splashing and would love to buy it. 
Does anyone know how possible it is to get a personal or business loan to buy it out ? Approx 30-40k 

I’ve only got one and half SA302 as that’s how long I’ve been self employed.

No chance. Business banks won’t lend as all you are buying is ‘goodwill’.
Personal loan would go tits up if they found out you’d used it for commercial purposes. 

Your only hope is if the current owner will let you repay in instalments.

I was in the same position as you and thought what’s the point in paying rent when I could buy the round for less including the interest. I really struggled to get a business loan as high tower mentioned even with a back log of accounts. In the end the bank manager advised me to apply for a joint personal loan with the wife. As a sole trader doesn’t matter how you obtain the money just as long as it’s declared properly. your accountant will sort that.  It sure how it would work if you was limited though. I think most unsecured personal loans only go up to 25000 so if you want 30-40k your probs gonna need to secure it. 

Obviously we don't know the value of the work. I'm going to assume you're a single operator pulling in a max of 5k? That seems realistic. If so 40k would be 8x the value of the round. That's not a good deal for you. If you're already servicing the round and the chap wants rid then you're the obvious person to buy it. If he were to sell to anyone else they would likely lose a lot of customers... And probably to you as they know you.

Realistically if you said to your customers you were starting up on your own a large chunk would move to you. He probably knows that too. The deal needs to be fair for both parties and IMHO £20k (based on my estimated monthly take 4x the monthly value) would and should be the upper end of what you pay.

With regards to loans you can go on Clearscore, put in your details and it will find loans you're pre approved for. Remember you are buying goodwill which is not tax deductible so you will be taxed on everything you earn and cannot offset the loan against it.

I would never pay that kind of money. You put out 100 flyers you'll find a customer. Work 30 hours a week for 10 weeks, and you'll have 300 customers.

The difficult part is paying your bills while you dont have any or little customers.

Best bet would to find something part time, something else, so there is no conflict of interest, then start knock out flyers until your full.

3 months of hard work, and you will save yourself 40k+ when you take into account the interest. Plus if you get your prices right from the get go, you wont be inheriting any underpriced work.

My first flat was 50k, that could be life long debt trying to pay that off. Paying hundreds a month on top of you wages, running costs, replacing equipment, vans and paying tax bills for decades.

CrispySquid said:

Just been asked if I want to buy out the round in currently working on as a sublet. 
For context the round is big full months work in the summer, struggle to get round in the winter. 
At the moment subbing I’m making enough cash but not exactly splashing and would love to buy it. 
Does anyone know how possible it is to get a personal or business loan to buy it out ? Approx 30-40k 

I’ve only got one and half SA302 as that’s how long I’ve been self employed.

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Your going to pay 30k-40k for a window cleaning round... Loan companies would not  borrow 30-40k for a window cleaning round, with that 30k-40k u could easily build a bigger and better round and u could even save your money.... its all about marketing, go and sell your business and u will reap the rewards.

And if u think buying a round is going to be smooth well then you are wrong mate... buying a round from someone else and taking over it is a bigger and harder challenge then building your own round up, 30k-40k for a window cleaning round is a big gamble, if your paying that much for the round make sure u get the phone number with it aswell and also make sure u have all branding rights of the business your buying etc.

If I didn't have kids I would come down and get you 300 well priced jobs for half that. A couple of months canvassing for 20k, I would still be ripping you off.

Biuld it up yourself, it will be a valuable experience. Your going to loss customers. They die, move house etc. Marketing is an important part of running a business. Take it as an orpertunity to put your time in, and gain the knowledge and confidence. You'll have way more chance of sucess in the long run.

Haychh said:

Your going to pay 30k-40k for a window cleaning round... Loan companies would not  borrow 30-40k for a window cleaning round, with that 30k-40k u could easily build a bigger and better round and u could even save your money.... its all about marketing, go and sell your business and u will reap the rewards.

And if u think buying a round is going to be smooth well then you are wrong mate... buying a round from someone else and taking over it is a bigger and harder challenge then building your own round up, 30k-40k for a window cleaning round is a big gamble, if your paying that much for the round make sure u get the phone number with it aswell and also make sure u have all branding rights of the business your buying etc.

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It couldn’t get much smoother as he’s already working the round. I know as I’ve done it myself. 

laddergarder said:

If I didn't have kids I would come down and get you 300 well priced jobs for half that. A couple of months canvassing for 20k, I would still be ripping you off.

Biuld it up yourself, it will be a valuable experience. Your going to loss customers. They die, move house etc. Marketing is an important part of running a business. Take it as an orpertunity to put your time in, and gain the knowledge and confidence. You'll have way more chance of sucess in the long run.

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If your starting from scratch then yes but he’s not. He’s basically just doing the same thing he has previously but paying a loan off rather than rent. Pretty much the same as buying a house rather than renting. Renting is dead money so why not invest it instead. That said for 30-40 grand I’d want at least enough work for two working full time. When I took over mine I paid 14000 for 700/weeks worth of work to get me started. I’ve never advertised, done fb have a website or any thing like that. I’ve only just got my van signed up, not to gain work but just to look more professional for my own ego. My round had still grown and grown to the point were I’m pretty much full booked for two people just by being out there. Sometimes there are other ways of doing things and if your lucky enough to inherit a round with good ones being like gold dust these days as no one wants to sell there good work then I’d snap there hands off especially if you already know the work.