Need money for your business? Soft loans, the disabled entrepreneur’s friend

Soft loans are another source of finance when starting up a business. I would always advise people to first try and obtain a grant but if your business has a large amount of start up costs then a soft loan may be unavoidable.

For any disabled entrepreneur taking on a loan should not be done lightly and careful consideration should be given to the interest, the size of the repayments and the overall cost.

Soft loans are usually offered to disabled entrepreneurs by national and regional organisations like the Prince’s Trust and charities who work with the visually impaired, deaf, those in wheelchairs etc.

A soft loan is like any other loan, such as a personal loan or a business loan offered to a person with a disability. Basically you borrow an amount of money to eventually pay back, in regular payments, plus interest. The main differences between a soft loan and a regular loan are;-

1. Soft loans tend to come at a lower rate of interest than your standard business or personal loan. On some soft loans rates are even at 0%, but often there is an administration fee.
2. There is usually a holiday period from when the loan hits your bank account to when you have to start your first payments. This can be up to 6 months.
3. Sometimes organisations supporting the disabled entrepreneur will offer holiday periods if the person gets into trouble paying back the loan. This can be useful to a person with disabilities if their business is on a downturn or illness is dictating how many hours they are working.
4. The biggest advantage of a soft loan is in some circumstances if the business stops because of ill health or lack of business, it can be possible for the debt to be written off by the organisation who granted it. This would be at their discretion and the person with the disability would have to show that they have really tried to make the business a success.

The other thing to remember when being granted a loan is to include the repayments into your business plan and cash flow. This way you will be able to see if you can really afford it.

7 Responses to “Need money for your business? Soft loans, the disabled entrepreneur’s friend”

  • I am a disabled individual with a small business looking for funds to expand and tap into other opportunities. Are there any organizations willing to take a chance on me with the soft loan?

    At minimum I need around 12,500 but would prefer $25,000 due to all the copyrights, trademarks and other fees involved with trying to organize information to do business with companies such as Nike, Inc.

  • i I am disabled and have been an consultant for party events ,see website http://www.jomelloeventplanning.com,I am not really making money with this so now I want to supply a banquet hall for wedding receptions and to have theme parties offered for a reasonable price.Also to supply wedding dresses to those in the community who cannot afford to buy the expensive dresses.when there are no bookings for a party I would like
    to provide an actor’s workshop for the community,headed up by my husband who has his degree and experience from L.A.C.C.for a
    resonable fee.I need money to decorate the hall ,supply the kitchen with
    all utensils and meals provided for events and vendors,to obtain a liquors license and operating licenses for the services provided .I will like to hire 2
    cooks,a cake maker,2 security guards,and assist.financial person.From
    the business plan I have I would start with leasing a bldg.with the
    proper lay out,then spending money on advertising.Please advise the
    best avenue to find the money.respectfully,Josetta Turner

  • Miss Sami Khan:

    I am buying a established business in London. I am facing a shortfall. I have put down my own capital on it.
    But need help with rent etc.

    Sam

  • brian smith:

    I am Deaf and I wish to st up a small garden business myself as I am currently working 30 hours a week as a garden. I wish to ask for help if you can help to able me smal loans which I am looing into 3,000 to 5,000 this would set me up with a small van and small items tools. I have been reject from the bank (lloyds).

  • Jon:

    Hi Brian – Have you read my other posts about getting grants?

  • chris:

    hi there im really struggling to find what im looking for im 30 years old and have been disabled for 11 years i have a left side weekness from a stroke have suffered a brain tumor and have epilepsy im not at a goo position health wise and would like to start my own business but funding is a severe issue for me i cant afford to put any more than a couple of hundred pound out of my own pocket but basic start-up costs are going to be between £5000 anf £10000 i would like to get as much as i can from grants but am unsure who to approach or if i match the criterior for them the other option is soft loans but i do have a very poor credit rating so could i still get one and once again where do i look

  • Mike:

    Hi Chris, If you need £5000 – £10,000 then i think you need to rethink your business idea because them days are long gone. Why not start off small and build the business up. There is a new scheme called enterprise allowace (ask your DEA about it) you might get £1000 soft loan

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