| . |
|
SMALL BUSINESS : Small Business Loans : Most small businesses can get loansIf you want money, it'll cost you Despite a global credit crisis that has shaken some of the biggest Wall Street institutions, most small businesses are still able to get bank loans, though lending terms have tightened and the worsening economic picture could soon take a toll, according to a number of financial experts. The Federal Reserve reported this summer 65 percent of the domestic banks it surveyed indicated they had raised their lending standards on commercial and industrial loans for small business, up from 50 percent in the spring. In some cases, this means the banks are demanding higher credit scores and want more collateral before lending. Lines of credit may shrink Jay Trien, an accountant and small business adviser in Morristown, N.J., said loans for creditworthy small companies still are available. But he said many banks are facing their own financial constraints, and they might, out of necessity, begin to curb lines of credit and other financing for small businesses. "We haven't seen the kind of tightening we saw in the 1980s and early 1990s, but business should be prepared for it to happen," Trien said. "I've been telling my clients to watch out." Michael Bergmann, an economist with AMG National Trust Bank, said small businesses definitely are finding lenders applying more stringent standards. "People who have good credit will be able to get loans, but it won't be cheap," he said. "Credit for small business has not dried up, but marginal borrowers won't get loans, and all institutions will be more demanding." Scaled-down projections Among other things, banks are being more conservative in their financial projections for companies, Bergmann said. Clare Wherley, a small business adviser in New Providence, N.J., said the credit crunch is not having a major effect as yet on small businesses, many of which are cutting back and not out looking for business loans. But she said many small businesses use credit cards as a line of credit, and with interest rates rising, they are feeling the effects and taking a financial hit. Bill Dunkelberg, chief economist for the National Federation of Independent Business and chairman of the board of Liberty Bell Bank in Cherry Hill, N.J., was more upbeat. He said there has been no evidence of any serious credit problems for most small businesses that have regular relationships with community banks. "It remains a Wall Street issue, although some small business owners probably did have loans at the megabanks and may have noticed a problem," Dunkelberg said. "Regular borrowing activity was reported by 34 percent of the owners, unchanged and typical of readings for the past 15 years." Dunkelberg said the NFIB's September Small Business Economic Trends survey found business owners who say they've had a harder time getting loans in recent months rose 1 point, to 10 percent, while in 2003, only 3 percent reported business loans were harder to get. Dunkelberg said the percentage of business owners having difficulty getting loans in previous economic downturns was much higher than today. "The data make it clear that there was no seizing up of credit markets, no frozen supply, no sudden reduction in credit availability to Main Street firms, as portrayed in the media," he said. Some can't meet standards Nonetheless, he said a slowdown in the economy has changed the creditworthiness of some potential borrowers as sales and profits decline. Even if banks have not changed their lending standards, he said, some businesses can no longer meet them. "Even with no change in credit standards, more rejections will occur," Dunkelberg said. "And many creditworthy borrowers don't need credit in a period when business expansion makes no sense and inventories are being reduced, not increased." He said only 2 percent of the owners cited the cost and availability of credit as their No. 1 business problem, far from the record 37 percent in 1982. Declining number of loans Charles Thomas, director of the federal Small Business Administration's office of program development, said the agency has seen a decline in the number of government-backed small business loans made by its commercial lender partners. "We are probably down 25 percent in number of loans processed in 2008, compared with 2007," he said. "But in the last month or so, the decline seems to have been flattening out." He said the drop is a result of uncertainty about the economy and financial markets. "It is a case of lenders not being aggressive in marketing some of these loan products and an indication of less robust demand by businesses," Thomas said. "It is also the result of some restructuring by major lenders. Some have taken a step back and re-evaluated their loan-making philosophy." By ROBERT COHEN Sept. 19, 2008 - chron.com Opening a Small BusinessAspiring entrepreneurs are fairly excited when they make the decision to open a small business. Sharing this news with friends and family usually generates a response referring to...Starting a Small Business IdeaYou have thought out an angle for starting a small business idea that is going to revolutionize the industry. Are you willing...Good Small Business PracticesGood small business practices require good business etiquette. To succeed in starting a small business, it's not enough to be the first, the best, or the most competitive...Ergonomics and Modern Workspace DesignToday, few small businesses need concern themselves with a lot of hard labor, but workers are breaking their backs at a whole new kind of grind, spending up to fourteen hours...Small Business LoansSooner or later most small businesses need to get a small business loan, whether to get the operating capital for business startup or to finance an expansion. But whether...American Small BusinessesEven today, the American economy is by no means dominated by giant corporations. Fully 99 percent of all independent small businesses in the country employ...Other Related Articles: Getting Small Business Loans in a Recession with no Collateral Sep 2, 2010Th? global financial crisis h?? m?d? ?t difficult f?r all types of business including small businesses t? g?t business loans. But there a couple of things you cn try to get the much needed loan....Obama's proposed SBA loan changes will help few small businesses Feb 26, 2010The Obama Administration recently proposed changes to the Small Business Administration's ( SBA ) loan guarantee programs to help small business owners whose access to credit has been reduced as a by-product of the financial crisis...SBA loan breaks waiting list has started Feb 22, 2010The Small Business Administration ( SBA ) has run out of money for incentives that made its loans less risky for lenders and cheaper for borrowers. The SBA will set up a waiting list...Credit Unions offer small business loans and possibly lower rates Feb 19, 2010Small businesses are asking for loans for a variety of growth options and some small business owners are looking at credit unions since larger institutions...Last bank left standing for small business loans Dec 3, 2009The choice of lenders willing to work with small business owners has changed dramatically in the last year with the exception of one bank...Michelin will provide small loans to start-up businesses Sept 3, 2009Greenville-based Michelin North America launched a new program Tuesday to provide small business loans to disadvantaged companies across the Upstate and named its banking partner that will administer the loans....Want an A.R.C. Loan? Head to the Heartland August 17, 2009The Small Business Administration recently began posting a list of banks making America’s Recovery Capital loans. The list, which is supposed...Small Business Loans for Newly Set Up Home-Based Businesses August 4, 2009For those who have saved up enough to be used as capital, setting up a small home-based business would be the best solution. By the time new capital infusion becomes necessary, small business loans ...Small business lending falls sharply July 7, 2009Despite emergency stimulus measures, small business lending continues to fall. In the just-ended quarter, the Small Business Administration's flagship program ...Changes to SBA Loans Provides Help to Small Businesses June 22,2009Many argued that the recently passed economic stimulus bill included very little to help small businesses in the United States. Small businesses ...U.S. allows more firms to seek small business loans May 1, 2009The Obama administration will allow about 70,000 more firms to apply for small business loans guaranteed by the government by temporarily raising size limits for the program, government ...Federal Plan to Aid Small Businesses Flawed April 1, 2009Two weeks after President Obama announced a $15 billion initiative to spark lending for small businesses, every major provider of these kinds of business loans ...How to Get Small Business Loans March 27th 2009Getting a small business loan in this economic climate can be tricky, but it is certainly not impossible. When getting a small business loan, banks will...How to Win Small Business LoansYou've got the ideas, the desire, and the plan. All you need at this point is some more money, right? Working with banks on small business loans ...Small banks offer business capitalThe latest credit crunch will make it even harder for small businesses to secure business capital. But some small banks hope to fill the void ...Most small businesses can get loansWASHINGTON — Despite a global credit crisis that has shaken some of the biggest Wall Street institutions, most small businesses are still able to get bank loans ...Small business marketsBILLINGS - The new regional director of the Small Business Administration says small-business owners report banks are reining in credit ... |
. |
