6/22/2010 - Big Changes in the Business Loan Approval Process

Published by Bloomberg.com

June 22, 2010

Big Changes in the Business Loan Approval Process

By Monica Mehta

In the not so distant past, when money was cheap and time was tight, a FICO score of 700 and a one-page application was enough to land a $150,000 business loan.In the time it takes to get a drive-thru cheeseburger, some of the biggest small business lenders in America were handing out lines of credit by relying heavily on personal credit scores to rubber-stamp applications. Given that most business loans are unsecured, a lender has little recourse, when a loan goes sour, beyond the personal guarantee of principals. And if the principals backing a loan are broke, a personal guarantee is virtually useless. . . .

http://www.businessweek.com/smallbiz/content/jun2010/sb20100622_671235.htm

 


 

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The North Country Small Business Development Center is funded in part through a Cooperative Agreement with the US Small Business Administration. All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA.