Question
Can you decipher and explain this to me like I'm a 5 year old ?
Was looking into a franchise opportunity. Below is an excerpt from the email I received from a representative of the company. I'm not business savvy. I think I know what this means but I'd like the opinion of someone with more experience ... "liquid cash", "loan package", "30% cash injection [30% of what?]". "... a traditional business X facility requires about $150,000 in liquid cash resources in order to qualify for a loan package. The reason for this high initial investment is due to the current economy and the fact banks are requiring a 30 percent cash injection and they will then finance the remaining 70 percent of the start up costs. " So is $150,000 the total start up cost - and the 30% cash injection would be $45,000? Thanks.
5 months ago - 3 answers
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Seems to me they're asking for (or advising, I can't tell) $150,000 down on a $500,000 loan.. So you put up $150K and then finance the other $350K.
by Gravy
5 months ago
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Other Answers
My reading is that the $150,000 represents the 30% with the banks willing to provide the rest.
by Johnka- 5 months ago
to me it sounds like they want 150,000 liquid cash so you can qualify for a loan to get started. 30% of the 150 K. liquid cash is money or investments that can immediately turned into money if needed.
by Love Life- 5 months ago