Small business loan borrowing opportunities may be more available in 2011 if predictions are true which state that more credit and capital could become accessible as factors like consumer confidence, economic growth, and unemployment begin to improve. Obviously, there are small businesses who are in need of capital or access to credit in order to grow their business, but there have still been reports that more small businesses are continuing to hire despite the fact that unemployment remains high.
Also, new small business loan initiatives from the Small Business Administration are hoped to bring more capital to areas like underserved communities or to businesses who may need a smaller loan amount for their company but are having trouble finding lenders.There is obviously still concern on the part of some lenders as banks feel that some small businesses may still simply be unable to repay their debt if a small business loan was made and there have also been indications that collateral that some businesses are offering may also be hindering small business loans as well.
There are companies that offer their property or a business owner may offer their home as collateral, but since some property values have been low there are businesses that have been unable to access the amount of money they need or any small business loan at all. However, banks have also complained that regulators are putting constraints on their lending practices which has also led to a smaller number of small business loans which are being seen, as well as, an overall unwillingness to borrow on the part of many small businesses.
However, there are those who want banks to be more responsible with their lending practices, but not deny access to capital for small businesses which may have had a good payment track record in the past or are in a position where they have the ability to repay a loan even if collateral may not be there. As example, a company that may be in a position where they can repay debts related to a small business loan but may not have the property value or collateral in the amount to match their need in a small business loan may still be considered a safe risk by certain small business lenders, which again can provide access to capital that is vital for businesses to grow and begin combating high levels of unemployment.
It’s hoped so that in 2011 more small business loan options may become available and with programs like the SBA’s Loan Advantage program which is hoped to provide business loans and financial assistance to underserved communities, business growth and employment will begin to pick up as companies begin to expand, become more profitable, and hopefully need more workers to simply keep them running.