Check out Inc.com article: Small Business' Real Problem with the Banking System...

"Increased regulation of bank lending still needs to allow for measured risks that permit sound small businesses to receive funding needed to thrive."

Read the full article at Inc.com., In The Trenches, written by Vanessa Merit Nornberg. Vanessa recounts her experiences with financing for her small business start up, Metal Mafia. Interesting and insightful take on the current climate for credit availability for small business.

Click here to read the article.

Check out: The Three Biggest Myths About the S.B.A.

Check out this great article by Ami Kassar of The New York Times about the S.B.A. ... very informative...

The New York Times, June 19, 2012
The Three Biggest Myths About the S.B.A.
By: Ami Kassar

I want to share with you what I consider to be the three biggest myth about the Small Business Administration. But let me be clear: I am a big supporter of the S.B.A. My company, MultiFunding, brokers loans, and we put about 25 percent of our clients into S.B.A. loans. I think it's a good program with a lot of eceonomic benefits. It's also terribly misunderstood by many of the small-business owners we talk to.

So let's debunk some myths.

1. The S.B.A. Lends Money.
2. When the S.B.A. Guarantees a Loan, There is No Need for Collateral.
3. S.B.A. Loans Are as Easy to Get as Other Commercial Loans.

To read the full article Ms. Kassar's debunks... click here.

Hey all, check out "7 Ways to Finance a Small Business" from BusinessNewsDaily

7 Ways to Finance a Small Business
By David Mielach, BusinessNewsDaily Staff Writer
Nov. 30, 2011

The road to starting a successful business can be a long one, filled with many hurdles and obstacles along the way. Even if you have a great business idea, no business can succeed without a financing plan. While the process may sound daunting, there are many small business financing options for anyone thinking of starting their own business in 2012.

• Small Business Administration Loan
• Friends and Family
• Home Equity Loan
• Credit Cards
• Angel Investors
• Venture Capitalists
• Strategic Investors

To learn more about each option, including advantages and disadvantages... click here to read the full article.

Check out A 'Match.com' fr entrepreneurs and lenders from crainsnewyorkbusiness.com

crain's new york business.com
By: Elaine Pofeldt
October 18, 2011

BoeFly aims to aid businesses disappointed by their banks, but there's new competition in this financial services niche.

The Company: BoeFly
What it Does: It's an online marketplace matching small business borrowers with lenders around the country.
How's It Doing: Founded in 2010 by two finance industry veterans, the Manhattan-based site is generating nearly $150,000 in revenue a month. It has raised $4 million from private investors. The founders expect it to become profitable in 2012.

To learn more about BoeFly... read the full article... click here.

Check out ""Small Business Administration is an unnecessary, costly agency"

Interesting....

The San Francisco Examiner
sfexaminer.com
By: Tad DeHaven - Special to the Examiner
08/18/2011

Washington continues to entrust stale bureaucracies with the job of righting the economic ship, instead of getting the federal government out of the way. One of those bureaucracies is the Small Business Administration, which has been employed by Congress and President Barack Obama to reignite private-sector lending.

The SBA does this by guaranteeing loans issued by private lenders for up to 85 percent of losses in the event that loan recipients default. As a result of the guarantee, lenders are more willing to lend money to riskier applicants because the SBA - and thus taxpayers - is ultimately responsible for the bulk of any losses.

to read the full article... click here.

Tips for Business Buyers: Selling Yourself - Seller Financing

Courtesy of Business Brokerage Press
Remember that when a seller offers seller financing, he or she is taking a risk. If you are the buyer, the seller is taking a risk on you, that you will be able to run the business successfully. Therefore, other than a seller needing the cash from the sale of the business, the biggest obstacle to seller financing is the seller's concern regarding whether a new owner will be able to pay off the loan from the profits of the business. While the seller already has the best idea about the potential profits of the business, there are some additional things a seller may want to learn about a potential buyer.

To read the full article... click here.

How to Finance an Acquisition

The credit crunch has led to an increase in seller financing, asset-based lending and alternative sources of capital for buyers.

By Carolyn Brown
Inc.com, Jan 2011

In pursuing an acquisition there are always key items to consider such as the continued growth opportunity provided by the target company, purchase price, and financing terms. Many acquisitions fail due to these priorities not being in line, say M&A experts. For instance, a common mistake buyers make is to focus on an attractive purchase price, rather than the strategic importance of the company's present and future growth plans.

Securing capital and the best financing terms for an acquisition can be daunting and challenging. The sub-prime lending crisis and sluggish economy over the past 24 months has created huge changes in our financial system.

to read the full article... click here.

Check Out: New small business loans approved in 'minutes'

CNNMoney.com
By Catherine Clifford, staff reporter
December 15, 2010

New York (CNNMoney.com) -- The Small Business Administration announced two new lending initiatives on Wednesday aimed at getting relatively modest loans to small businesses quickly.

The idea is to get loans under $250,000 into the hands of small businesses efficiently: Applications are only 2 pages long and can be approved anywhere from "minutes" to 10 days, according to the SBA. Greater access to credit should help spur firms to grow and hire, giving the economy a boost.

To read more.. click here.

Check Out: An Alternative Financing Option for Start-ups

The Wall Street Journal, Small Business
WSJ.com, December 2, 2010

Entrepreneurs Going the Royalty Route Use a Share of Revenue to Pay Back Loans

By: Scott Austin

When first-time entrepreneur Philip Vaugn recently began searching for start-up capital, he traveled down two conventional paths.

Mr. Vaugn, co-founder of travel-review aggregator Raveable.com in Kirkland, Wash., says he wasn't interested in forking over a large chunk of equity to venture capitalists or committing to ambitious investment-return expectations. He also considered a loan, but knew that banks had made it onerous for young companies like his to obtain debt financing.

"We're in a weird spot" but we have "a decent amount of revenue coming in," says Mr. Vaughn who expects Raveable's sales to grow two to three times annually.

So he's considering an alternative called royalty financing, in which a company pays back a loan using percentage of revenue. Traditionally found in industries such as mining, film production and drug development, royalty financing is being seen more among technology companies and other early-stage firms with growth potential.

To read the full article.. click here.

Check out: Money is available for small businesses, but it takes work

Posted 11/21/2010 6:00 PM
USAToday.com, Small Business

AskAnExpert: Steve Strauss

Q: I hear that there is more money available these days for Small Business Administration loans. Is that true? If it is, how do I apply to the SBA to get one? Thanks in advance. Maurice

A: Yes, it is true that there are more SBA loan funds available right now than in years past. This is mainly due to 1) a change in administrations, and 2) the fact that both TARP and the new small business law added funding for SBA lending.

To read more... click here.

Check out Editorial: Small businesses need more access to credit

By News Sentinel Editorial Board
KnoxNews.com
Posted November 19, 2010 at midnight

Small businesses breathe jobs into the economy, but tight credit is strangling them even as the nation slowly recovers from the worst economic downturn since the Great Depression.

Banks and other lenders remain tight-fisted, frustrating many small business owners who are ready to expand. Without access to credit, business owners can't invest in new equipment or new workers. Seasonal businesses that rely on credit to smooth out dips in cash flow are finding themselves vulnerable, even though they're profitable on a yearly basis.

To read the full article... click here.

Check out Finding Surprises in the Small-Business Jobs Bill

By: Robb Mandelbaum
New York Times
Business Day - Small Business
Monday, September 27, 2010

Most of the controversy surrounding the small-business jobs bill that cleared the House of Representatives on Thursday - after nearly a year of discussion - concerned a $30 billion small-business lending fund to be established by the Treasury Department.

But like most of the legislation, the lending fund is a temporary fix. It will make investments in banks for just one year. The tax breaks in the bill, worth about $12 billion, are mostly good for a year or two.

But one part of the bill, which President Obama will sign into law on Monday, also makes permanent and far-reaching changes to the Small Business Adminstration's guaranteed loan programs - it both allows banks to make much largers loans and permits bigger businesses to take advantage of them - changes that have not been widely discussed. Taken together, these measures potentially could alter the essential character of the S.B.A.'s borrowers - it could make them not very small.

to read the full article... click here.

Check out... SBA Program Proves a Hit, but Now It Is in Limbo

By Ruth Simon
August 5, 2010
Wall Street Journal (WSJ.com)

Pinnacle Bank made just two loans through Small Business Administration in 2007 & 2008. So far this year, the Orange City, Fla., bank's total is nine, to borrowers from an auto dealer to a computer-equipment wholesaler to a bakery.

"The SBA program is the only way we can continue to lend right now," says David Bridgeman, president of Pinnacle, which has two branches and assets of $213 million, including about 600 loans. For many of the $3.4 million in loans Pinnacle made through the SBA in 2010, the bank has to set aside capital against only the 10% slice that isn't guaranteed by the U.S. government.

Across the nation, many banks have turned to the SBA's so-called 7(a) program to help unfreeze credit. Nearly 3,000 lenders have made 7(a) loans in the current fiscal year, up 21% from 2008.

The 7(a) program, the SBA's largest loan program, is hardly a cure for the credit shortage affecting many borrowers. The agency is involved in less than 10% of all small-business loans, and some banks won't participate because of red tape. Lenders must follow the SBA's rules when making 7(a) loans, which can be used for working capital, fixed assets and other business expenses. The term of the loan can be as long as 25 years.

Last year, Congress temporarily sweetened the 7(a) program by increasing the SBA guarantee to 90% of any given loan from as little as 75% previously. Lawmakers waived fees costing borrowers as much as 3.5% of the loan amount, as well as costs charged in a separate SBA program providing structured financing for fixed assets.

But the sweetened program is now in limbo, drawing complaints from borrowers and lenders, as lawmakers haggle over broader small-business legislation.

To read the full article... click here.

check out... Getting an SBA Loan: 5 Things You Need to Know

Getting an SBA Loan: 5 Things You Need to Know

Getting a business loan is tough -- especially these days. But the Small Business Administration can still be a great lending partner. How to cut through the red tape and secure an SBA loan.

Chasing a Small Business Administration loan these days is a little like going to a carnival and expecting to win one of those giant stuffed animals. It might happen, but the odds are probably against you. As Christine Reilly, the president of small business lending for CIT, points out, about a year ago, the federal government tinkered with the formula for getting an SBA loan, and for a brief shining time, even during the Great Recession, SBA loans were semi-easy to come by.

Of course, it's still possible to get an SBA loan -- Reilly is the first to admit it -- and it can be a great way to infuse your company with cash. But how can you navigate the red tape and make sure all the effort pays off? Here are five things you need to know.

• Know the lingo.
• Document everything.
• Got collateral?
• Do your homework. Seriously.
• You are not a risk taker

to read the full article … click here.

Check out Loans to Small Businesses Plummet...

Business Sherpa: "Not so good news on the small business loan front."

Loans to Small Businesses Plummet

Loans backed by the Small Business Administration dropped significantly after stimulus incentives dried up.
By Rachel Leven
AOL Small Business online, 7/14/10

After a noticeable increase thanks to stimulus perks, loans backed by the Small Business Administration tumbled in June after funding for the incentives dried up. The total value of SBA loans made dropped almost two-thirds, from $1.9 billion in May to $647 million in June.

The drop in small-business loans comes amid the ongoing financial reform debate in Congress.

The economic stimulus upped the guarantee on the SBA's flagship 7(a) loans 90 percent instead of 75 percent and reduced or waived fees on the 7(a) and 504 loans. These incentives were added to bolster lending practices after the recession began in 2008.

The Senate is currently considering a small-business reform bill, which would extend support for SBA lending by decreasing fees and increasing guarantees. If it passes the Senate vote, which could occur next week, the bill will then move to the House.

The SBA Has a Deal for You

It's called a 504 loan. Here's what you need to know about it.
By Marshall Eckblad
Wall Street Journal: Small Business Online
June 21, 2010

The government is trying to entice more small businesses to tap one of its loan programs. Before applying for one of these loans, though, there are some fine points borrowers should consider.

The Small Business Administration's 504 loan program lets companies take out fixed-rate financing to buy property, build or expand facilities, or refinance some existing mortgages. The borrower typically needs to put down just 10% of the transaction's total price.

With the weak economy deterring many small businesses from expanding in the past couple of years, demand for these loans plummeted: Last year, the SBA approved $3.8 billion in 504 loans, down 28% from 2008 and 40% from 2007. Hoping to spur expansion among small companies, the SBA is offering inducements like lower rates and no-fee deals.

To read more... click here.

Three Best Ways to Court a Community Bank

By EMILY MALTBY
Wall Street Journal, WSJ.com

Discouraged by big-bank practices and bureaucratic procedures, many Main Street firms have "gone local" with their lenders. Community banks are often more willing than their larger counterparts to conduct business on a handshake because they understand the needs of their neighboring establishments and, in many cases, have underwriters in-house to approve loans.

In exchange, however, those lenders expect more from their borrowers. "It's like that old saying, dig a well before you are thirsty," says Brian Carlson, president of Excel National Bank, a standalone lender in Beverly Hills. "It can take some time before [a banker] says, 'I know this guy and I'm confident he'll do what he says he'll do.' Having that relationship is valuable because if you need $300,000 by the end of the week to take advantage of an opportunity, the bank will jump to get it done."

Here are the three best ways to develop a relationship with a community lender:

To read more... click here.

U.S. Banks Post Profits, but Woes Persist

Sherpa--This might be a clue as to why credit is so tight.

By MICHAEL R. CRITTENDEN
Wall Street Journal, WSJ.com

WASHINGTON—A total of 775 banks, or one-tenth of all U.S. banks, were on the Federal Deposit Insurance Corp.'s list of "problem" institutions in the first quarter, as bad loans in the commercial real-estate market weighed on bank balance sheets.
Poor loan performance in other sectors also continued to hurt banks, with the total number of loans at least three months past due climbing for the 16th consecutive quarter, FDIC officials said in a briefing on Thursday.
"The banking system still has many problems to work through, and we cannot ignore the possibility of more financial market volatility," FDIC Chairman Sheila Bair said.
There were 702 on the FDIC's "problem" bank list at the end of 2009 and 252 at the end of 2008.
FDIC officials said they expected the number of failed banks to peak this year after climbing steadily over the past three years. Regulators have shut 72 banks so far this year, more than double the number closed by this time last year. Ms. Bair said regulators were preparing for a steady pace of additional closures through the end of the year. A total of 237 banks have failed since the beginning of 2008.
The failures continue to strain the FDIC's fund to protect consumer deposits, although officials signaled they were confident they had enough cash on hand to deal with the expected spate of failures, without having to assess new fees on the banking industry. The agency's deposit insurance fund stood at negative-$20.7 billion at the end of the first quarter, a slight improvement from the end of 2009.
"We have the necessary industry-funded resources to complete the cleanup," Ms. Bair said, in a reference to the fees that the agency assesses on banks for insuring their deposits.
Banks, squeezed by problem loans and the continued recession, responded by reducing their lending. The industry's total loan balances grew by 3% during the quarter, but the increase was due to accounting changes that required banks to bring securitized assets back onto their balance sheets. Without taking into account these accounting changes, lending would have declined for the seventh straight quarter, as banks cut back across most major lending categories.

To read the full article …click here.

End Of an Era... Paul Paquette

One of my favorite bankers is leaving the profession to follow a different career path. Paul Paquette at Wells Fargo has been one of the area's top SBA lenders. Paul has been known for his diligence, hard work and professionalism. I liked working with Paul as he was quick to give a "yes" or "no" on a deal, and if it was a "yes" he worked hard to close the loan. In addition he was always patient with my "lobbying" about the merits of a transaction. Good luck Paul in your new career!!!!

Small Business Owners Still Doubtful about Economic Turnaround

Blog By JULIA L. ROGERS, AOL SMALL BUSINESS

Small businesses aren't quite buying the reality of economic recovery yet, reveals a survey conducted by the National Federation of Independent Business (NFIB) in March. Most have continued to be tight-budgeted, stalling hiring and expansion in the sector.

Entrepreneurs in small companies across industries are still frustrated as they watch larger companies get low-interest credit and enjoy rejuvenated businesses. Unfortunately, their pessimism and failure to take advantage of all benefits offered to them is seriously affecting the strength and speed of the recovery. Because of sour attitudes among those in the small business community, economic experts believe that President Barack Obama has his work cut out for him as he attempts to move forward with fresh policies to help smaller companies add jobs and expand. Reuters reports that issues related to employment and job opportunities are critical in this congressional election year and could make or break results...

To read the full article... click here.