Whether you are an Obama supporter or can’t wait for the Republicans to make a comeback, what they do in Washington D.C. is not going to be the answer to your business credit needs any time soon.Okay, that is not always the case. If you need an SBA loan and some of the recent changes have improved availability, it might help you.But for most businesses looking to a local community bank to make the loan, nothing has improved recently. Nor has it gotten particularly worse.If your recent financial statements and tax returns show you have a strong business with good cashflow and good collateral, you have a good opportunity to get the loan. Banks want to lend. They particularly want to make C&I (commercial and industrial) loans.If your business took a hit in 2008 or 2009, you are going to have a tough time convincing the bankers that things are better now. They want solid evidence. They need solid evidence to show the regulators.Business bankers have a lower risk appetite than they did pre-recession. Their regulators are not in the mood to be flexible. And as far as I can tell, as evidenced by many conversations with business bankers, nothing that is happening in Washington D.C. is being felt ‘on the ground’ in relaxed diligence of the bank examiners.So back to basics:
- Determine what you really need in the way of business credit
- Go to your traditional bank first and have a heart-to-heart with your business banker
- Understand what changes in your bank will impact your ability to get a loan
- Look for other sources of financing which might include family and friends, asset-based lenders, credit unions with a member business loan division or simply another bank
But don’t wait for Obama. The President can only do so much to improve access to credit. Don’t count on it being enough for getting what you need and when you need it.
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