Turned down because I rent!

[YMW]

I live in a rented house, have done in the same house for the past 5 years. The landlord is very friendly as are the estate agents we pay the rent to. I have spoken to the landlord about using a room in the house to work from home and although it is not part of the contract they said it will be fine. Unfortunately the banks don't see it that way when I've applied for a merchant account. Because I don't own my home and don't have rented premises, they are not happy to give me a merchant account, so it looks like sticking with paypal. Anyone else had this problem?

[Steve2507]

Unfortunately I can see the banks point of view. It would be very easy to say you ran a business from such and such address when in fact it is a con (I'm not saying that what you are doing is a con, I'm just being relistic from the banks point of view). If you owned your own house at least they would have some chance of recompense if it turned out to be fraudulent.

Is you company limited? If not then set up a limited company and approach the bank again as they treat ltd differently to sole traders. Also ask your landlord to set up a contract for your use of the room, this just gives you more ammunition with the bank.

[sysops]

While I sympathise with you, this type of safeguard is vital, and without it the credit card system just wouldn't work.

[NuBlue]

I sympathise with you on that. It seems a bit harsh but I suppose the banks need to take these measures to protect themselves.

Just as a thought. Is it possible to register a PO Box address for the purposes of the Merchant account?

[Steve2507]

Just as a thought. Is it possible to register a PO Box address for the purposes of the Merchant account?Don't do that. PO Boxes have their uses (we use one for various things) but they are also a powerful tool in the conmans box of tricks. If a bank already has missgivings then saying your have registered a po box may make things worse.

As I said before are you a ltd comapny?

[YMW]

Thanks for the messages. No I am not a ltd company. I will look into it, thank you. I can understand it as well in a way but I do have a track history of sales already. I just wondered if it had happened to anyone else. I thought I could just use paypal or nochex until the business is big enough to move into premises.

[Steve2507]

Unfortunately it isn't about the person anymore, it is simlpy a numbers game. You efectively get xpoints for having your own home, x points for having a land line, xpoints for being a ltd co, xpoints for this, xpoints for that. Then if the points tot up you get the account. Others will say it doesn't work like that but effectively this is the way it works.

This is what I would do:

1 - Set up a Ltd Co
2 - Get a landline phone under your own name if possible
3 - Open a normal account at your local bank (do not go through telephone banking initially). This will put you in front of a business manager who may be able to sway the poiints system.
4 - Run your business as a Ltd Co for at least 6 months.
5 - All payments that (I am presuming) currently go into your personal account transfer to your business account. I know you may not be able to change bank details and emails easily with PayPal, but what you do is if you withdraw £1000 from PayPal then when it hits your account transfer it to your business account. This is good from an accounting point of view as you have a record of every penny going into the business.
6 - After you have been banking like this for 6 months go back to your business manager. Do not apply over the telephone for a merchant account unless you have no choice. If you make the appointment and they ask what you need to see them for - lie. If you say you want a merchant account they will tell you to phone the helpline. What you need is to sit down with the manager, explain your fears, previosu rejection etc and he/she may be able to sway it for you.

Hope this helps.

[YMW]

Wow Steve that is fab advice, thank you so much for that, I seriously appreciate it!

[Steve2507]

No problem, I used to be bank manager at a leading UK bank and I have no love for banks (made me seriously ill - i.e. I nearly died).

The problem is you can't beat them so you have to learn to play the system to your advantage.

[quikshop]

No problem, I used to be bank manager at a leading UK bank

And I had you down as a nice guy :p

[Steve2507]

And I had you down as a nice guy :p
Key term is "used to be":D

[ARP_UOL]

This is interesting because here in Germany if they turned people down for renting no one would get loans!
The shortest term mortgage is 10 years and you can pay up to 50% penalties for paying in advance (!).
I do understand why the banks do this after reading these posts.

[Steve2507]

This is interesting because here in Germany if they turned people down for renting no one would get loans!
The shortest term mortgage is 10 years and you can pay up to 50% penalties for paying in advance (!).
I do understand why the banks do this after reading these posts.I agree with you that someone renting shouldn't stop them being financially viable. But unfortunately thats they way the UK banking system looks at it, so as I said you just have to learn how to play the system.

[Muttley]

I agree with you that someone renting shouldn't stop them being financially viable. But unfortunately thats they way the UK banking system looks at it, so as I said you just have to learn how to play the system.

The weird one is that the majority of small businesses in the UK work out of rented premises albeit COMMERCIAL properties.... Often on a lot shorter term leases than residential..

So what the heck is the difference here apart from inbred, intitutionalised SNOBBERY..... makes you laugh it's like getting a shotgun certificate application countersigned signed by suitable persons this (as well as the usual culprits of JP, MP ,Doctor, Lord ETC..) includes bank manager and teacher BUT NOT a Chartered Engineer - lets see it takes around 15 years of professional and acedemic dedication, blood sweat and tears before you even get a SNIFF at chartered engineer status during which time you could potentially kill somebody with a wrong decision - teaching well thats about a year of college as for "bank manager"... thats just a stripey shirt, some red braces, some really BAD acne and an overinflated attitude problem and yer in.

Sorry but this country is totally @rse over elbow... the people that actually do the work, that lead, that make the decisions, that put their balls on the line (male OR female) are totally hamstrung buy those who hide behind grey institutional facades and scripted call centres grabbing your money.... "50,000 jobs to go in the banking and financial sector as a result of credit crunch" was a headline a couple of weeks ago - Laughed... I had to change my underwear several times.. poetic justice.

You may note a slight hint of bitterness....

YMW - If you want any help from someone who is in a similar position then give me a shout, you can get round these issues.

[gibby]

there are other merchant account providers out there who im sure will help you

usually poor credit records etc mean they will hang on to a % of the money for so long or delay payment for up to 4 week

plenty of ppl have merchant accounts from rented home addresses but they do like to see 18 months of trading

do a search and go through them all

G

[Steve2507]

The weird one is that the majority of small businesses in the UK work out of rented premises albeit COMMERCIAL properties.... Often on a lot shorter term leases than residential..

So what the heck is the difference here apart from inbred, intitutionalised SNOBBERY..... makes you laugh it's like getting a shotgun certificate application countersigned signed by suitable persons this (as well as the usual culprits of JP, MP ,Doctor, Lord ETC..) includes bank manager and teacher BUT NOT a Chartered Engineer - lets see it takes around 15 years of professional and acedemic dedication, blood sweat and tears before you even get a SNIFF at chartered engineer status during which time you could potentially kill somebody with a wrong decision - teaching well thats about a year of college as for "bank manager"... thats just a stripey shirt, some red braces, some really BAD acne and an overinflated attitude problem and yer in.

Sorry but this country is totally @rse over elbow... the people that actually do the work, that lead, that make the decisions, that put their balls on the line (male OR female) are totally hamstrung buy those who hide behind grey institutional facades and scripted call centres grabbing your money.... "50,000 jobs to go in the banking and financial sector as a result of credit crunch" was a headline a couple of weeks ago - Laughed... I had to change my underwear several times.. poetic justice.

You may note a slight hint of bitterness....

YMW - If you want any help from someone who is in a similar position then give me a shout, you can get round these issues.If you had read the OP properly you would have seen that the owner of the business was also renting, not a house or a flat but by the sound of it a bed sit type room (sorry OP if I am wrong). This type of arrangement puts a greater degree of risk on the bank, it isn't about snobbery (and as an ex bank manager thank you for calling me inbred) it is about figures, pure and simple (however those figures can be swayed if you know what you are doing).

As for the fact that you laughed at 50K people losing their jobs (regardless of the sector), well that comment is below contempt.

Teaching is not about a year at college, they have to keep on top of their subject by regular learning (i.e. a lifetime), it is about teaching our children and personally I need to be able to trust my childrens teachers and that is what is important. Yes civil engineers must go through a lot of education but the don't have to be cleared to work with children do they? So I know who I would trust more.

A bank manager is just about a stripey shirt? What sort of stupid comment is that? Do you know what education a bank manager has to have? Or what continual education they have to have (i.e. lifetime)? Obviously not.

Do not start slagging off different working sectors unless you really know a lot about that sector (i.e. from working knowledge). You obviously have some deep problems with regards to other businesses and other business sectors, maybe you have been made redundant, but i am sure a search in G will be able to find a Doctor to help (or don't you like these either).

[Muttley]

Do not start slagging off different working sectors unless you really know a lot about that sector (i.e. from working knowledge). You obviously have some deep problems with regards to other businesses and other business sectors, maybe you have been made redundant, but i am sure a search in G will be able to find a Doctor to help (or don't you like these either).

Steve

Apologies this was written when I was having a particularly bad moment - it wasn't meant to be as vitriolic as it appeared - It was a sub-concious spleen vent that went too far. and I'm sorry. The cracks about snobbery were unfair I was being 'crabbit' and I was bang out of order. What gets my goat is the fact that there is a lot of institutionalised hiding behind multiple "its our policy" statements and trying to find someone who has the balls to make a decision is hard - so call it an institutionally aimed broadside rather than an individual one.

I will hand on heart admit that I have little knowledge of the banking or finance sector and so my comments were bang out of order but based on some of the people from this sector that I have had dealings with - and that day I had been dealing with a particularly poor set of call centre robots with a rapidly failing temper. The crack I made about the 50K jobs going was more directed at those city types with massive bonuses who in all probability will not loose their jobs it will be the line grunts that will take the brunt of this as allways.

As for education I do have DIRECT long term working knowledge of this sector and I have to admit that yes 99% of teachers give the rest a bad name. Sorry there are some hardworking dedicated individuals in the profession and those people have my sincere respect but there are an awful lot more pollitically correct muppets treading water and kowtowing to the latest missive from the LEA. Common sense is a very rare commodity particularly with teachers and their spending decisions are a joy to behold - never in the field of local government has so much been sqandered by so few on so usless a pile of cr@p particularly in the run up to the end of each financial year.

As per usual I've gone off half cocked and started ranting if I have offended you un-intentionally and caught innocents in the spray of vindicive indignation.

[Steve2507]

Hi Gavin,

Apologies accepted, we all have those moments.

Believe me I have no love for the banking industry, I was a bank manager, had a break down (too many 70 hour weeks) and was sacked becasue of it. I tried to commit suicide twice because of it, so as I said my love of the banking industry is (lets say) less than positive.

I firmly agree that there are a lot of "its not our policy" statements floating around banks. Thats why I advised the OP not to contact them via the helplines and instead to go in face to face.

I agree with your take on the teaching profession, but then again the lack of common sense does seem to be a pre-requisite for any local government jobs (if my experience is anything to go by).

[Muttley]

but then again the lack of common sense does seem to be a pre-requisite for any local government jobs (if my experience is anything to go by).

Well ther is allways the old adage that if they could hack it in the real world......

I worked for local government for three years doing Network Administration for the LEA... I had to get out or I would have murdered somebody I once had a surreal conversation with one person about the differences in purchasing policy, this person had NEVER been out of the public sector - school, universite then either local government or voluntary sector. I was trying to order 10 blank CDs as we had ran out but needed authorisation from a department manager as well as my immidiate supervisor - which I had (having filled in the appropriate form in triplicate) the conversation went along the lines of:

HER: You haven't entered a business case for these... what is it?
ME: er.... hello, we have run out so we need them QED end of argument
HER:have you investigated suitable alternatives

(you may have guessed she wasn't technically literate)

ME: Wellllllllllllll............... we could order seventy odd floppies instead.
HER: What was the cost differential???
ME: You are JOKING..?????
HER: we have to BE SEEN to do everything properly...
ME: But every minute we are having this conversation is effectively costing a couple of blank CDs in terms of our time time
HER: But we don't cost our time out like that
ME: You don't but I DO
HER:It's not your concern
ME: But it's ingrained into me - I've come from the private sector thats how we work there
HER: But you would still need to get authorisation...
ME: Were I used to work I had to get authorisation for any spend over £10k...
HER: But that would be overseen
ME: Nope....
HER: But but but what if you got it wrong? You could run amok, you could spend it on anything!!!
ME: If we got it wrong we'd get a b@llocking or your P45 if we got it really wrong..
HER: But you could spend it on anything!!!
ME:Yes but the fact that we were trusted not to was the limiting factor don't you see.. this level of supervision in industry would cost far too much.
HER: But.... But... but...
ME: If I got it really wrong then you could cripple a business
HER:So what stopped you??

She really didn't get it

Me: Then I would have been out on my ear as the business would have gone bust....

She just totally failed to understand the concept of personal accountability and thinking as a individual - here was a bright, highly educated, intelligent young woman in a fairly powerful position in the LEA who simply couldn't make any decisions by herself other than what to have for lunch... the whole Local Goverment culture is like that save for a very few all the decisions are comittee based and therein lies the rub... by the time they do get to a position of being able to take these decisions as an individual they are as a whole incapable so they pick the path of least resistance even if it is totally wrong OR the decisions they make are so wildly inappropriate they are farsical.

The concept of failure is just not allowed in Local Government in this country, it is totally alien it has been banished from their lexicon - if somebody does make a mistake then rather than learn from it it is brushed under the carpet and whitewashed over or half a rainforset is culled to document a new procedure for it.

It really is scary to witness...

[Steve2507]

Great isn't it.

I worked for the NHS before I went to uni (early 90's) and we once worked out it took 21 people/processes to change a lightbulb. Read this remembering our department was right next door to the engineering department. I could literally walk out our back door and be in the engineering department in about 10 seconds.

I would fill in a memo to our dept secretary
She would complete it and hand it to or dept head to sign
He would pass it to our dept secretary
Our dept secretary would put it in the internal post
Internal postman would collect it and take it to the sorting room (other side of hospital)
Postman would sort it to be delivered to engineering department
Postman delivers it to engineers department
Engineering secretary hands it to head of dept
Engineering head authorises it and hands it back to secretary
Secretary hands it to head of repairs
Head of repairs assigns it to repairman
Repairman comes round to find out wattage/bulb type etc
Repairman puts in reqisition for bulb to engineering stores
Storeman confirms it and gets bulb from store
Reparman comes to fit bulb
I sign to confirm replacement
Signed counterfoil given to engineering secretary
Secretary gives it to postman
Postman takes it to the sorting office
Postman sorts it
Postman brings it back to our secretaryGot to make you laugh:rolleyes:

[Antony]

If you speak to Experian they can give you a detailed breakdown of your full credit report free of charge. They may be able to advise you of further ways to help the situation.

Hope this helps.

[ehih]

I live in a rented house, have done in the same house for the past 5 years. The landlord is very friendly as are the estate agents we pay the rent to. I have spoken to the landlord about using a room in the house to work from home and although it is not part of the contract they said it will be fine. Unfortunately the banks don't see it that way when I've applied for a merchant account. Because I don't own my home and don't have rented premises, they are not happy to give me a merchant account, so it looks like sticking with paypal. Anyone else had this problem?

Hi YMW,
I believe I will be in a very similar position to yourself, and am hoping to start using "PayPal Website Payments Pro" for payments on my new website..
just thought it would be the easiest way to get started..
but just wondering what are the advantages if you could get your merchant account? and on the flip side what are the disadvantages of sticking with paypal?

[sargeant7203]

Hi YMW,
I believe I will be in a very similar position to yourself, and am hoping to start using "PayPal Website Payments Pro" for payments on my new website..
just thought it would be the easiest way to get started..
but just wondering what are the advantages if you could get your merchant account? and on the flip side what are the disadvantages of sticking with paypal?

I have tried without success to open a business bank account and have no choice to use my personal account.

I applied and got accepted for payapl pro and I cannot fault it. The only blip I had was when it restricted me from withdrawing money for a few days for security checks due to an increase in transactions. There was bound to be an increase, it had only been open 3 weeks. I was worried and did have sleepless nights as one of the things they asked for was proof of delivery tracking number. I couldn't provide this as we deliver ourselves but they looked on our website and they were fine and all was restored.

The transaction fees are quite high at 3.4% plus 20p but this can be reduced after a few months to merchant rates, you do have to apply it's not automatic. Our new rate in 3 months will be 1.9% so it's a little better. The virtual terminal is brilliant too and easy to use.

It takes about five days to be accepted after application as they do a check to see if you are on the electoral role.

The best thing is being able to take payments over the phone.

[ehih]

I have tried without success to open a business bank account and have no choice to use my personal account.




It takes about five days to be accepted after application as they do a check to see if you are on the electoral role.

The best thing is being able to take payments over the phone.


Hi Sargeant,
If the reasons are not personal; would you mind telling me why they wouldn't give you a business account?
I will be looking for one myself shortly..but I'm getting the impression that I will be hard pressed to get one, and considering that I'm Irish (not a UK citizen) its going to make it even harder for me to get one??

and another thing that has just worried me is that you mentioned that you have to be on the "electoral role" to be accepted by paypal..have you any idea if there is any way around this considering that I am an Irish citizen??

[sargeant7203]

No Eoin I don't mind at all. They didn't give me a reason just stated bad credit score. The thing is I didn't ask for any credit just a basic business bank account. I have no bad debts either. I even joined the fsb to get lower rates with Streamline and the Co-op but ended up being turned down

I have opened a seperate personal account for the business as otherwise it will be a nightmare when I fill out my next tax returns. However I would much prefer a business account.

I would ring them with regards to not being on the electoral role to see if there is a way around it. I know they do use it because the first time my partner applied and he got turned down because he wasn't on it at the time as we had just moved. The other thing that went against us was our website wasn't live at the time.

They are based in Ireland so should be quite understanding with regards to you being an Irish citizen. Give them a ring and explain your circumstances they are very helpful when you speak with them.

Good luck

[ehih]

Ya thats a good idea Sargeant; to have another separate personal account for your business as it could get very messy other wise!

I will probably have to do the same if I cant get a business account; In regards to receiving cheques, because you have a personal account does that mean that you cant lodge cheques made payable to your business name? ie: All cheques have to be made out to you personally?