A friend offer me a investment opportunity at 15% annually, is it too good to be true ?

He was my coworker. I know him at work for years. It is unlikely he take money and run away.

He ask me a loan to scale up his business, promised to pay 15% annually.

His work is in manufactures industry, maybe B2B. He said he his business don’t depend on number of customer available. I don’t know. I am a salary man. I know nothing about business and investment.

I haven’t ask him into the detail yet. I know nothing about this type of business. He seem confident, but I feel the 15% is so unlikely that will come with (hidden) risk. Maybe my friend is also a victim of another scam, or he just overconfident.

People of Lemmy, I ask you, those who are investor and business owner: is >= 15% annually ROI possible ?

glad_cat,

15% is a scam.

neptune,

Is this a loan? At fifteen percent interest?

Don’t mix friendship and money.

hahattpro,

Yes, it is a loan.

But the 15% is so high, i don’t think i come without risk. I just ask to know if it is possible to run something with more than 15% ROI, to be able to repay the loan and get interest for yourself.

Junkers_Klunker,

I wouldnt ever loan money to a person who are not disclosing the riscs.

neptune,

Someone is getting ripped of here. Could be OPs friend even.

Junkers_Klunker,

It could very well be the friend being scammed.

scytale,

his business don’t depend on number of customer available

Clarify this with them. If the business does not depend on customers and selling a product/service to them, then it’s most likely a pyramid scheme/MLM. If he continues to be vague about what exactly the business is, that’s another red flag. A legit business shouldn’t be hard to explain, especially to people they want to ask for investment from.

conciselyverbose,

The risk is that the business fails. There are no "sure thing" investments, especially at higher returns.

Ask him how his business can fail. If he doesn't give you a variety of possibilities and ways he's hoping to prevent them, I'd be very worried that he's overconfident and not prepared for difficulties.

intelisense,

This sounds incredibly risky. Proceed with caution!

iamdisillusioned,

Get all the details, then come ask us.

bjoern_tantau,
@bjoern_tantau@swg-empire.de avatar

Get it in writing.

But yeah, it’s sketchy as fuck. If he could guarantee that ROI he could just go to a bank.

If you can afford to lose the money and maybe tolerate a lengthy trial go for it. Personally I couldn’t.

hahattpro,

The reason he can’t go to the bank because he have take enough loan and can’t take anymore. He said I can make money by apply for loan against property, and loan to him and pocket the different.

It seem that he want to take more loan than the bank want to give him.

Yeah it seem risky as fuck. So i am asking.

EdanGrey,

Absolutely do not take a loan out to loan to him

Moobythegoldensock,

That’s not how that works. For a business, if he can show the bank his business plan, they’ll loan him whatever they think he can afford to pay, and at a lot better rate than 15%. The fact that the bank isn’t suggests they think he’s full of shit.

Junkers_Klunker,

That sounds sketchy af. I would run, FAR …

agressivelyPassive,

If his business would be viable, banks would give him loans up to a reasonable amount.

cabbagee,

If he can’t pay back the bank loans, how will he be able to pay back yours?

retrieval4558,

Anyone who would suggest this does not have your best interests at heart

moody,

So he wants you to take a loan out using your property as collateral to invest in his business? And if he doesn’t get you the promised return, what do you think happens to your collateral when you can’t pay back your loan?

roguetrick,

He said I can make money by apply for loan against property, and loan to him and pocket the different.

You never give loans to someone that you're not completely prepared to write off. You absolutely don't give loans with loans (unless you're a bank and getting those loans from a central bank, which I doubt you are).

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