Loaning a friends business 30,000, whats a good rate??

Discussion in 'Growing and Managing a Business' started by phill96, Oct 16, 2012.

  1. phill96

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    Oct 16, 2012
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    Hi guys. I'm new to the business side of things.
    I made some money on my first house i sold a few years ago & I've got some money sitting in a bank at 5%, to which i can still access.
    My mate is going into business and has set everything up, but for his first job he needs a loan of 30,000 to pay for supplies and staff for the 3 month job. The job is paying 120,000. so a fair profit is to be made. I'd be working there as one of the 6 guys on the job.
    The company pays 3 months after the job is complete therefore the money will be loaned for 6 months. I'd get the solicitors to document it legit but i'm unsure what sort of percentage interest i should be charging him and what i'd be comparing it to? Do the banks do loans for 6 months or are they 1-2 years.

    Any advise would be greatly appreciated.

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