Applying overdraft without telling DH

[Bluebells81]

I started a new business this year. Income is building but my cashflow prediction is that the company is likely to have a temporary £6k shortfall in a few months.

I would like to apply for an overdraft of c.£10k to bridge this period. When I mentioned this to DH he was angry and blamed me for not managing the business properly.

Usually we would have savings that I could have put in as a loan. But our savings are really low now because DH reduced his working hours last year to do a building project on a property we own. This was partly an investment in the property and partly a training/passion project for DH. Expenditure and loss of earnings was about £40k. He never asked my agreement in advance to use this money or stop working. He kept me up to date on costs but I do wish I'd questioned it because I am not sure it was a good investment. But I trusted DH and was caught up in my own business and here we are.

So now I am wondering whether to just go ahead and apply for the overdraft without his agreement? It doesn't seem right but the other option is weeks of arguing about it followed by potentially applying too late or having to use all our remaining savings. Keen to avoid both of those options.

Do you mean as a business, you want to apply for overdraft? Seperate from your DH?
Or do you mean personally, where he could end up responsible?

I don't know about business overdrafts, but personal overdrafts at least are the most expensive mainstream way to borrow money so should be avoided unless it's literally life or death.

If you have to borrow money you'd be best looking at a credit card offer (either money transfer or using creatively, ie get a 0% purchase offer and either put the expenses on that or use it for other essentials like groceries and petrol to free up money to put into the business) or a personal/business loan.

Is DHs work on the property going to pay off at all, either by increased rental income or by selling it to recoup the investment?

are you looking into a business overdraft? Who will be responsible for it if you go out of business?

Will the overdraft be against an account he is party to? If so you would need his permission. If it's against an account solely in your name ( personal or business) then you don't need his permission. If any joint assets are given as security against the debt then you would need his permission.

Thanks for answers so far. The overdraft would be for a business account that is in my name only for a limited liability company. Because of the nature of the business we can access finance like small loans or overdrafts at very good rates through our specialist bank.

I was just wondering whether married couples usually need to give permission with regards to their other half's business finance? It doesn't cost the business anything if we don't use the overdraft. It just seems sensible to arrange that backstop in advance forvthecworst case scenario. We do also have that amount in savings so if we needed to pay it off we could.
It also seems to me pretty normal for a new business to need to borrow a small amount while it is still too new to have much cash in the bank - not a result of "bad management"?
Still pondering whether involving my DH in the decision is something one should do to keep an own and honest marriage. Or whether I should trust myself to make a good decision without him.

It wouldn't even occur to me to ask my dh. I might tell him but actually my business is none of his business. He has no legal responsibility for it.
I think you dh is applying double standards.

The business is a separate legal entity from you and any borrowing by the business will be unrelated to you or your DH personally.

Is he a director of the company?

I don’t think you need his permission but I’d probably bring it up again and talk to him about the options. Personally I’d rather have my DP onboard with taking on extra debt although I don’t think what you are describing is a big deal and I wouldn’t expect my DP to object to it. I’d discuss it with him because we discuss most things. On the flip side I would expect a discussion and to have input on my DP reducing hours and taking on a project, again, not for him to ask my permission but I’d expect to be involved in the decision.

Unless he is a director / partner in the business or you are asking him to put up collateral i.e. a guarantee or give a charge over a property owned in your joint names to support the overdraft technically he doesn't need to be involved. Will they ask you for a directors guarantee ?

However in the interests of your marriage you should chat this through with him as in the event of any difficulties in our business / further cashflow issues he will need to know as your business and you will be impacted which may ultimately impact him.