Debt

No one who owns a business wishes to sell all of their equity in their company.  Therefore, owners look to secure debt in order to leverage their business without selling all of their equity, which in essence is giving the company away.

This section describes several types of debt you may wish to consider as you plan the financial engineering of your business.  Banks offer several types of loan packages based on your needs.

In general, a bank or other note maker needs to understand what the loan will be used for, how you will pay it back, and what are you pledging to secure the loan.  In some cases, you may have to be a personal signatory to guarantee the loan.

A newer company may be required by a bank to have a specified debt-to-equity ratio.   

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