Opening A Child Care Center

I never would have known that opening a child care center was going to be so difficult. After six long months, the business plan was born. The celebration was on. The experts loved it.

The state child care bureau loves the idea. They are exited that a state licensed child care center is moving into a much needed community where there are hundreds of children needing quality care. The blueprints are approved for construction. This is a major accomplishment. Everyone said this was the toughest part. Boy, were they wrong. DEAD WRONG!!!

The financial institutions. What a HEADACHE! Over a year since the business plan was born, the financial backing needed is still not available. We are tired of hearing, "You have a great plan, but..." I never would have known that there were so many "but's" . When will someone just have faith? The bank lenders are there to sell you. They pretty much will say anything to you to get the opportunity to serve you. What a crock. I never would have known that every time our credit report was looked at; it was at the expense of 10 credit points on the FICO score.

I would have never known that someone else's credit was on my credit report until the eighth bank ask me to explain the discrepencies. AND YES IT WAS TRUE. Another person with the same name, 16 years younger, with a different birthday and a totally different SS# was on my credit report. I disputed it. I was successful in having all that removed from my credit report. SURPRISE. The bank says, "Even though it was explainable, it was a negative with the underwriter." ARE THEY KIDDING ME?

I never would have known that when a commercial lending officer tells the other business partner to get a line of credit on her home for as much as she could for our down payment, "That was a big negative with the underwriter." CAN YOU BELIEVE THAT? SHE JUST DID WHAT YOU TOLD HER TO DO!Did you know that to meet the requirements from the state agency (and make a profit), there must be a sizeable building; which, in turn, means a sizeable loan request? The total project costs are $1,250,000. The financial insitutions require 20%-25% as down payment. Let's see. If I had that kind of money in my back pocket, I would probaby not be thinking of opening a business. Plan A does not seem to be feasible so we think other options. Build a smaller building, lease a building, purchase a building?

Plan B: Build a smaller building? OK. I break out the projections and get to business. I work the numbers for hours and the numbers are RED. By the way, RED is very bad. This scenerio puts us in bankruptcy within six months. The numbers turn green with a minimum number of children; so that means Plan A. Let's move to Plan C.

Plan C: Lease a building? Great! We found a building. It's perfect. Hope is on the horizon. Over a year later and it looks like our dream will come true. The owner of the building will renovate the building for a whopping $300,000, of which, we need to pay $200,000 of the costs. OK, now our total cost is only $500,000. This is doable even though the lease price would have been more than a mortgage payment. OH NO! BRICK WALL! NOT AGAIN!!! #@*&#

The banks do not like the idea of giving the $200,000 for the renovations because it would not be our building. What? Simply stated, the banks can not put a lien on the property to secure the loan. But, they love the plan and realize that child care centers make money. Plan D is next.

Plan D: Purchase a building. Where? Properties are limited. The cost to renovate one that we did find was more than construction due to the strict state guidelines. That plan is out. Go figure. Back to Plan A: We might have an investor type plan to implement for our 20%-25% down. Although, we are not sure if that will work but we are willing to try. So, I guess this makes Plan E.

Oops. the stock market is not cooperating. Another delay. Conventional banks are not willing to help. Are they only there for the people who have money and do not need it? It appears so. Non-Conventional SBA lenders are "freezing" loans at this time until the market stablizes. DELAY, DELAY, DELAY.

I definetely will not hold my breath. We will not give up. Someone will eventually come through. It has been almost two years since conception.

GIVING UP IS NOT AN OPTION.