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Ask Jane Applegate
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December 23, 1999: 1:39 p.m. ET
Checking out commercial zoning laws and finding working capital
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NEW YORK (CNNfn) - Here are answers to your questions for CNNfn small-business columnist Jane
Applegate:
Dear Jane,
I want to start a small tax preparation business in a home that I own, but don’t live in. It’s in a residential community. I don’t intend to have a lot of visitors, but I do plan to set up an office in the living room so folks can stop by to drop off and pick up information and tax returns. Do I need a permit or to get the zoning changed?
Every village, town and city has different rules and regulations governing home-based businesses. So, you need to contact the appropriate zoning board and find out what is permitted and what isn’t. You don’t want to invest a lot of money remodeling the place if you are going to be kicked out right away.
While many home-based businesses operate quietly and illegally, you can’t get away with pretending you aren’t operating a business in a residential area when people will be coming and going all week. If it turns out you can’t run a business in this home, sell it and rent space in a shared office suite. There are many companies out there that provide high-class but affordable office suites for rental to small companies. Most include support services like a receptionist and copying.
A large company called Headquarters Inc. rents space in office buildings all over the U.S. and in many foreign countries. There are many other companies doing the same thing, so check it out.
Dear Jane,
I started a small accounting business a year ago. My son is ill and I desperately need financing. The counselor at my local small business development center suggested I live off my credit cards or take a second mortgage on my house. My bank said an SBA-guaranteed loan could take months. What can I do?
It’s very tough to borrow working capital, especially if you are small and need it fast. You might consider applying for a home equity line of credit, rather than a second mortgage on your home.
This may also be the time to turn to friends and relatives for a low-interest loan. No one likes to borrow money from relatives, but if you can prove that you can pay it back in a timely fashion, you may have better luck obtaining a personal loan than a bank loan.
The SBA-backed loans shouldn’t take your bank months to process. Ask your banker if there are any micro-loan programs in your area. Micro-loans are usually loans for less than $25,000.
Many economic development and community development groups have micro-lending programs available. Use your high-interest credit cards only in an emergency. And, try to apply for a low-interest card, even if the low rate is available only for the first six months.
(Jane Applegate, a syndicated columnist and
author of 201 Great Ideas for Your Small Business, answers your questions here on Mondays and Thursdays. Readers with questions can e-mail her at . She will answer questions of general interest in future columns.) 
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