Lee, it is very fortunate that you were able to change your situation so dramatically.

I could argue that you sold the item to the pawn shop to buy your tools, which is not exactly debt. Or ask you where you got the money for the item in the first place(which must have been worth more than $360). But these are all details and I'm not going to second guess you.

But I will ask you: This pawn shop - pretty empty, right? I mean they really weren't selling much stuff that people never were never able to buy back, right?

So many small business startups fail, and every one of them went into it thinking "I'm not going to be one of the ones that fails, I'm different." You see it over and over again. Yes, starting a business on a loan can work. When it doesn't, it often means bankruptcy.

If you sister's business was growing that well, I'd venture an uneducated guess that they could have made-do for, say, three years and bought the new building with cash, risk free. Yes, they would be a little less wealthy than they are at the moment, but if things had tanked, they would have had a big pile of money saved instead of a mortgage on a failed business.

As I have been saying, debt involves extra risk that is often unnessesary. You can get lucky, but you can also be very unlucky. Therefore I would advise people to avoid it.