Setup Unsecured/Secured Lending Company

[OscarDeLaRenta]

Can anyone in broad strokes describe what is necessary, from a legal viewpoint (in terms of registration of entity, licensure, artificial entity formation, etc.) what is necessary to start a personal/commercial loan company in Boca Chica? I.e., this would be a loan company that lends to both individuals and small businesses. Also, is there a source that describes what the usury laws are and other requirements of this type of ongoing concern?

[cobraboy]

Originally Posted by OscarDeLaRenta

Can anyone in broad strokes describe what is necessary, from a legal viewpoint (in terms of registration of entity, licensure, artificial entity formation, etc.) what is necessary to start a personal/commercial loan company in Boca Chica? I.e., this would be a loan company that lends to both individuals and small businesses. Also, is there a source that describes what the usury laws are and other requirements of this type of ongoing concern?

You realize there are a bazillion of these in the DR already, right?

You need a lawyer, not advice from DR1ers.

[J D Sauser]

Originally Posted by cobraboy

...

You need a lawyer, not advice from DR1ers.

AND connections, so you will get either your money or your collateral in a reasonable amount of time. Actually, so your borrowers realize that you are not to be f'ed around with in the first place.


... J-D.

[Ladybird]

Its a waste of time. There are many new controls now for businesses and the laws are changing again in the summer.

[OscarDeLaRenta]

I'm not asking for advice on whether it's a good idea, and I don't care whether it's the worst business idea in the world for my purpose, which is to create a few remarks in an almost-unrelated consulting project. I'm asking for a paragraph of a HowTo from someone from a legal/bureacratic viewpoint for whichever laws/regulations govern. If someone would be helpful in this regard, I would be most appreciative. How the laws/regulations stand currently is most relevant, even if they are going to change in the summer or even next week, however, if you know how they are going to change, that would be very useful to include as well. Thanks DR experts!

[cobraboy]

Originally Posted by OscarDeLaRenta

I'm not asking for advice on whether it's a good idea, and I don't care whether it's the worst business idea in the world for my purpose, which is to create a few remarks in an almost-unrelated consulting project. I'm asking for a paragraph of a HowTo from someone from a legal/bureacratic viewpoint for whichever laws/regulations govern. If someone would be helpful in this regard, I would be most appreciative. How the laws/regulations stand currently is most relevant, even if they are going to change in the summer or even next week, however, if you know how they are going to change, that would be very useful to include as well. Thanks DR experts!

Get a lawyer.

Better now?

[cobraboy]

Dude: what kind of real businessman is going to go onto a message board for advice on a critical business issue?

Actually, you've gotten some serious advice and have chosen to just ignore it. Doesn't bode well for future success, huh?

[J D Sauser]

Originally Posted by OscarDeLaRenta

Can anyone in broad strokes describe what is necessary, from a legal viewpoint (in terms of registration of entity, licensure, artificial entity formation, etc.) what is necessary to start a personal/commercial loan company in Boca Chica? I.e., this would be a loan company that lends to both individuals and small businesses. Also, is there a source that describes what the usury laws are and other requirements of this type of ongoing concern?

Originally Posted by OscarDeLaRenta

I'm not asking for advice on whether it's a good idea, and I don't care whether it's the worst business idea in the world for my purpose, which is to create a few remarks in an almost-unrelated consulting project. I'm asking for a paragraph of a HowTo from someone from a legal/bureacratic viewpoint for whichever laws/regulations govern. If someone would be helpful in this regard, I would be most appreciative. How the laws/regulations stand currently is most relevant, even if they are going to change in the summer or even next week, however, if you know how they are going to change, that would be very useful to include as well. Thanks DR experts!

Unless you are planing to open a real bank I think that as some have put it, only a well versed lawyer and contacts and a good portion of ruthlessness on your part is what you will really need.

Regualtions? I am not sure they are of so much concern.

Let me tell you a little story to further my point:
In the early 90's I was living in Ecuador. I got into business and got married. After struggling with imports and exports, or better said, growing tired of feeding import and export "brokers, it occurred to me to get my own import-export license. I already had pretty good Spanish, so I did most of the process myself. Got a lawyer to guide me thru the process and did most of the run around myself. It took me about six months. Last station was the final approval and opening of a direct draft account with the Banco Central for all the customs business. I got to meet the director, who had to do the final sign off. Actually, I found him more exited about meeting me than I was about finally getting my lisence. He was really almost bewildered to find not a Gringuito getting his lisence but just ANYBODY. He told me that they had not issued any for over 3 years and asked me WHY I had wanted one. I told him! I just wanted to do things myself and the legal way. Pay my duties and taxes and get on with my life. After I short moment of total disbelieve he almost fell off his big chair LAUGHING!
And then he told me: FORGET about paying duties to the Banco Central, NOBODY at customs cares. What they do (or did) care about at the port of Guayquil, was to get paid under the table... the agents. Everybody in that business new that, so they even stopped applying for import-export lisences and the government used to not seeing any applications.

'nuff said?

I don't think that lending money here is bad business. I even know some local women doing it. They are loaded with money, homes, vehicles and so forth... but they are local, they got the muscle, the connections, the friends and someone in the family way up there protecting them and a family shister intimidating bad clients with sending the fiscal, the police and what not after them and what ever they have.

But then, that's not legal advice... it's friendly advice .

... J-D.

[OscarDeLaRenta]

OK, I was trying not to give too much detail so as to not too complicate things unnecessarily, but, that backfired. Apparently I have to emphasize AGAIN, this is NOT for a business I am starting, but rather for a CONSULTING PROJECT, which will only be a REPORT, the thrust of which has nothing to do with lending in the DR. This will be part of a page in more than 150 pages that have nothing to do with lending, nothing to do with the DR. What's more, the report will probably never be used, but may be, but it doesn't matter because it has nothing to do with the DR specifically, and you'll soon find out why. I am not looking for legal advice. I don't need a lawyer... It would be the utmost in stupidity...actually it would be more inane, per se...to retain professional counsel to get a very simple run-down from someone on what is needed from a practical standpoint to formally lend in RD. I am not debating whether to start a lending business. My client is not debating whether to start a lending business. Although I am not advising someone on whether he or she should start a lending business, in this specific report I am drafting there is a small section in which I am comparing the practical course one must take in two OTHER (non-RD) developing countries, to start a service business...the example will continue in this section of using a finance company, only to be consistent with the other hypotheticals used. I understand that for whatever reason people are gung-ho hell-bent to spout how difficult business is in the DR (maybe it makes them feel better about their own Capital plights, who knows...whatever) and especially this business, and love saying "you need a lawyer" but, true or not, the difficulty of starting the business is TOTALLY IRRELEVANT to both myself and my client, who is in an academic pursuit (and also the desirability or likelihood of success is irrelevant). How can I emphasize any more that whether it's a good business or not is irrelevant? How can I emphasize any more that it's not practical to retain legal counsel for such an informal question? So, please -- and I'm not complaining, mind you, because I appreciate all of your responses so far, it's just that JD's was the only once of any relevance to what I need -- please, please, please, just someone read what I wrote here carefully and let me know from a practical & legal point of view, what would be required to operate a lending practice in the DR, in your opinion... Unfortunately, though, JD's example wasn't about the DR, and that's the specific info I seek, for consistency purposes. So, if in your opinion, the practical needs are comprised of only bribing various officials who come knocking, then so state that. If you could be as specific as possible with which type of officials would be most likely to extend their hand (palm down to hit you, or palm up for money!), that would be great. If you think you'd need a local, district, and national license, so state that. If it is a lending license, combined with paying off officials and the challenging mafioso competitors and policia militar, so state that. I don't know how I can make myself any clearer. Let me state it again...don't need a lawyer, not looking for advice on whether it's a difficult/easy/good business. If you really have no clue about how things actually work in a specific way for this specific business there, go ahead and state that too! Thanks in advance!!!

[cobraboy]

So you're having a client pay you for legal advice for which you get answers from a message board, and not from an actual legal source.

Don't you feel guilty about taking money under false pretenses?