barrycarter t1_iyc9cje wrote on November 30, 2022 at 9:14 AM

Keep in mind that credit card debt can be negotiated and sometimes paid off for pennies on the dollar. In some cases, the credit card companies (banks) can end up paying you money if they violate debt collection practices. Always do debt negotiation through a lawyer since they will sue debt collection practices violators whereas companies that just do negotiation won't.

There was a time when you could invest in FOREX using credit cards (almost sure you can't any more), which gave you a little bit of arbitrage. If you invest in FOREX using credit cards and make money, great. If you lose money, you can pay it off for less than the total amount. You're basically gambling with someone else's money

All that is a long-winded way of saying: consider doing it with the understanding that, if your business fails, you can recover some or most of the cost by negotiating debt.

Of course, do NOT use home equity or any other form of collateralized debt for risky ventures

KReddit934 t1_iycq5by wrote on November 30, 2022 at 12:51 PM

You make it sound like these are easy outcomes...getting debt write-down or even damages!...while failing to remind OP that their credit worthiness will be trashed in the process.

toorbowski t1_iycqehb wrote on November 30, 2022 at 12:53 PM

whatever you do, dont listen to this person. Maxing out credit cards on the off chance that you could "negotiate" a lower payment with a credit card company is nonsensical. Not to mention what it would do to your credit worthiness if it gets to that point. There are no guarantees with this approach.

On your initial question, I'd say dont do it. Save up capital and try to start a business using the correct tools such as business debt (assuming you need or want to use debt for the initial capital, some people would say no debt ever).