While it’s obvious why it is difficult to impossible to get a decent loan from a bank these days, it may not be so clear why even SBA loans are becoming scarce. The short answer is they aren’t. The long answer is: depends on where you look for one.
Inc.com asked Christopher Hurn, CEO of Mercantile Commercial Capital, an Orlando-based SBA lender to give his insight on what is going on with SBA loans specifically, and the banking industry in general. “The biggest SBA lenders have been the large national banks that we’re now reading about in the news. The easiest thing for them to do is cut back in all areas, which they’ve done — including in their SBA divisions.”
SBA loans are still available, but not if you’re going to a bank that’s in duck-and-cover mode. It’s a sad fact that the institutions that are receiving billions of taxpayer dollars for mistakes the banks made and using it to heal themselves while at the same time making things tougher on the people who gave them that money. The banks do have one excuse though. Federal banking regulators are insisting that standards and protocols are met immediately, many of which prohibit the banks from pouring money back into the market. In a sense, they can’t win for losing.
So what is a small business owner to do? Right now, doing the big bank franchises are making it very difficult to do business with them, so steer clear until they have recovered – if you still want to deal with them, that is. Your best option right now may be to visit your local community bank or private institution for an SBA loan.
