Banks Less Accepting Of Homes As Collateral For Small Business Loans

A new survey by the Small Business Research Board shows that banks are looking twice at loan applications from small business owners who use their homes as collateral. Of the survey respondents who said that they use their home as collateral, about half of them reported that their banks had changed their small business credit limits, and slightly less than half of those reported that the change amounted to an increase in the small business’ credit limit. That’s a decrease of more than 20 points from previous studies.

In most cases, the small business owner’s credit limit was reduced, and the majority of the reductions were by more than 10 percent. One third of the survey respondents said that credit was more difficult to get, and one-fifth of respondents said that getting credit for their small business was “impossible.”

When you’re running a small business and need cash, the last thing you want to hear from a bank is “No!” Possibly the only thing that’s worse is having the bank decrease credit lines they’ve already agreed to extend to you. Fortunately, if you operate a US-based business that accepts Visa or MasterCard, and has credit and debit receipts of at least $2,500 per month, you are likely to qualify for a merchant cash advance from Rapid Capital Funding.

A merchant cash advance allows you to use your future sales to generate the cash you need today. Rapid Capital Funding can extend up to 1.5 times your monthly credit card receipts to you in just a few days. You can get the cash you need without a long application process, credit checks, collateral or personal guarantees. You get what you need when you need it.

Paying back the advance is simple. As your credit card transactions are processed, a small percentage of the transaction is forwarded to Rapid Capital Funding, and you keep the rest. You pay off your cash advance one transaction at a time. When business is good, your cash advance is repaid faster. When your business slows, so does your rate of repayment. This flexibility means that you’ll get the cash you need now and won’t be left high and dry when you’re repaying your advance.

If you’re having a hard time getting your banker to listen, stop talking to your banker and start talking to Rapid Capital Funding!

Photo Credit: Jan Stastny

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