Over the last three weeks, banks have finally started to loosen their purse strings when it comes to personal credit – especially assets backed lending, e.g. mortgages, car loans, etc.
However, while money is beginning to flow a bit more, the standards for receiving these funds are stronger than ever - meaning that your credit has to be in the stratosphere, the asset has to appraise well (I mean well) above the loan amount, and debt-to-income ratio levels have to be microscopic.
Although capital may be becoming obtainable again for personal spending and use, businesses are still facing insurmountable obstacles in getting the credit they need to expand and succeed.
Most small to medium business owners today just do not meet the standards that banks are putting out there. This hectic market has hurt credit scores, income levels, and asset values. This does not mean that there are not a plethora of business out there that are lendable and good loan prospects if the banks would merely look beyond their stringent loan policies.
So, what can a business do if it needs money? There are several non-bank companies that are stepping in to fill these lending gaps.
Not only will these companies provide funding to growing, struggling businesses and start-up businesses, but they usually do not require collateral. They provide unsecured loans and lines of credit with competitive rates and terms, and do not have the same strict requirements that most banking institutions do.
I have seen loans from these companies that have rates as low as 6.99% fixed, terms up to 84 months, and require little documentation and no collateral. Further, these companies also offer business lines of credit which allows business to draw only what they need when they need it and which can be drawn from, paid down, and drawn from again.
So, don’t think your business cannot get cash now – just because your bank says ‘no’. Look around, there are many non-bank companies that not only will lend to you, but, unlike most banks, look for ways to say ‘yes.’
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