Commercial Finance’s Biggest Player

The Biggest Player in Commercial Finance world is continuing to grant loans that most underwriters would not even consider, and yet they are being written every day and it has to make you wonder, Why is it that if the majority of companies in the United States and Canada are small business, then does it seem that the most leniency is given to the major corporations and not the little guy?

Listen to the radio and you will hear it every day…Big Business is getting billions of dollars in relief funds to help carry them through the rough times we are having now, and how often do you hear about the small business owner given these bailout loans? Never.

The workers that had been faithful to his company over the last number of years are planning to leave because he had to cut wages, cut hours, farm out work, receive gifts and loans from family member and there is no end to it in sight. The banks will not even return his phone call and the market fluctuations in the dollar have been devastating. Now, after a 13 hour day he is going home listening to the radio hearing about the Big Boys all lined up at parliament with their hands out looking for a bail out to keep them working.

You have to ask yourself, where will it end? What will it take to let the Big Players feel the same pain as the little guy? Unfortunately, I do not have the answer. All I have is questions. We are not looking for someone to come solve our problems, but what does a person have to do to catch a break these days?

Most understand that letting the Big Players will collapse the economy very quickly, but letting the little guys go down one by one will have the same affect, it will just be a more drawn out pain than a quick hit. Kind of like cutting your foot off yourself really slowly using a dull and rusty piece of steel vs. just lopping it off with a sharp axe in one shot. Both are really painful, but and no one wants either choice, but if it has to happen, the quicker the better (interesting analogy isnt it?)

Just for a brief moment he dreams about flying down to the meeting with the government and demanding a business loan for his company as well since he and his employees are hurt by the economic down turn as well. If the large corporations are eligible to receive these assistance packages, so should he. But then he wakes up and realize he was dreaming. Imagine for a moment, if the treatment for big business and small business was the same, what would the world look like then? Fairness…interesting concept.

As seen in the NY Times: The Obama administration deliberately stopped short of securing a majority or controlling interest in Citigroup, but will probably come under intense pressure to take a much larger role in shaping the banks direction. Taxpayers, after pumping more than $45 billion into the bank, have become Citigroups single largest shareholder. The government will not put in any additional money for now, but some analysts believe Citigroup may require more down the road.

The move is one of the most drastic steps federal officials have taken to prevent the collapse of an institution deemed too big too fail, as its downfall could send shockwaves through the global markets. The government also took a major ownership stake in the American International Group, and seized control of Fannie Mae and Freddie Mac in September. So far, none of those deals have turned out well.

Fortunately, for the politicians, this topic will be discussed for years to come, so there is job security for them at the least. Have we learned anything from this detestation? I certainly hope so. Question is, what did we learn and how can we do things differently to not repeat the same mistakes?

Are you ready to see the most conservative banking climate in many many years? Just wait a bit, it is coming. And unfortunately this lending restriction will continue to hinder many businesses…but there is an excellent alternative to banks. Commercial Lending Brokers. They have always been here, and many businesses have used their Professional Services, but there will be many more companies needing their services in the coming months. Commercial Lending Brokers have loan programs that the banks, even in their most aggressive climate could not do, and not the time is ripe for the Commercial Finance Broker.

If your company is in need of a Line of Credit, Accounts Receivable Factoring, Purchase Order Finance, Export Finance, Commercial Equipment Loans or a Commercial Mortgage see out a knowledgeable Commercial Finance Broker as they will have the expertise to get the financing you will need today and when things take off again because you know the banks will not be there when you start getting those big orders coming in and you need funding to produce.