Tenerife forum

[1969tammy0]

Hi all, sorry not been on the site in a while. Been really busy earning the Dollar.
Just a quick Question. We have decided when we make the move, that we are going to Invest 90% of our money into a Business, and put the rest away just incase of a rainy day.
We have learned over in Florida, not to buy a home straight away, and Rent first, rather than find out later you don't like the area.
How will we stand once we are residents, and lets just say we have been living there a year. Would we get a Spanish Mortgage with out putting a large lump sum down ?
In Florida you have to put down 25% and can only get a investors Mortgage, and in doing this you end up paying more property Taxes, which is about 25% more than a American citizen.
Thank's Tammy.

[rob]

A lot will depend on the type of property you buy. A new apartment that is being offered with a mortgage in place (because the project is financed by the bank) often means a deposit of only 10 or 20%. A resale property will depend on the bank's valuation of the property, not the selling price. It's a buyers market at the moment so you should be able to get a good valuation and therefore need very little deposit. As self employed you'll probably have to produce at least one years audited accounts to be able to apply for a low deposit mortgage, so you're probably looking at 18 months before you can buy.

I hope that you're not going to spend 90% on your business, what about start up costs, marketing etc etc. Unless you're talking about a large business you should look to spend only 50 % of your available capital buying the business. The rest you WILL need for costs. You cannot just go to a bank here and borrow some money if you find yourself short!
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[1969tammy0]

Thanks for the Info Rob.
We intend to buy a business that is well established. We bought a locksmith business here in Florida, it had been established 14 years with two employees. The day we landed we started earning money as it already had many accounts set up by its previous owner and good Tax returns.( turn key Business )
This is what we intend to do when looking for a business in Tenerife. We have seen to many people fail over here buying small Business, to build up and have no previous knowledge of running a Business, and I suppose the same happens over there. We have always been self employed and feel we need to invest more into a good Business then buy a small business and home, that's why I asked about getting a mortgage out there.
Do you feel this is the right thing to do ? or would it be better to start our own Business. I ask this as we don't know any thing about Tenerife, working out there or owning a business.
Thanks Tammy

[rob]

To answer that as a generality is impossible, I don't know your strengths and weaknesses. I think that your idea of putting money into a business and renting a home rather than trying to do both is a wise move. I always advise people to rent somewhere where they think they want to live for a year to see what it's really like and with the property market slower at the moment you're not going to lose out by property prices going up.

On the subject of buying an existing business or starting one from scratch....I tend to lean towards starting anew. The money that you pay for goodwill etc will support you and yours for a long time while building up trade. So much depends on the individuals ability to get out and do IT. Some people are OK at running something that has been built for them but cannot get off their feet and start a business.

It's all down to personality and ability.
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Remember: You don't stop laughing because you grow old, You grow old because you stop laughing.

[1969tammy0]

Again thanks for the quick response Rob.
Your advice is greatly appreciated. We do intend to have a long Vacation in Tenerife before committing our self's to any thing.
We can also take our time to think about buying a established business or like you said start anew. We have many Business Ideas that do well over here in Florida, and have been thinking about taking them over there, just need to see wether there is a market for it out there, and it's not already been done.
Thank's again Tammy.

[rob]

No problem.... you'll be buying me a few beers when you get here!
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Who am I? Follow the myspacetenerife link under my avatar.

Remember: You don't stop laughing because you grow old, You grow old because you stop laughing.

[1969tammy0]

I'll do better than that, and bring you a bottle of good old Mexican Tequila