Best banks for small business loans

English: Bank of America branch in Hillsboro, ...We all know it’s still tough out there to get a bank loan as a small business, particularly a startup. Turns out, it’s a lot tougher to get a loan approved at a select few of the nation’s largest banks than it is in general.

A new study of 1, 000 rejected small-business loan applications conducted by credit marketplace Biz2Credit found the turn-down rate varies greatly between institutions.

Overall, the lending environment still looks dicey, with the most recent National Federation of Independent Business optimism survey showing more entrepreneurs with a negative outlook on obtaining credit.

Which banks rejected the most loan applications in the survey? Here’s the top five:

  1. Bank of America – 13.5%
  2. JP Morgan Chase – 11.6%
  3. Wells Fargo – 11.2%
  4. TD Bank – 2.9%
  5. PNC Bank – 2.3%

The top three here are really of most interest, as the percent of rejections drops off steeply from there.

The top ranking of BofA is a touch ironic, given the statements the bank has recently made about its commitment to making these loans and to hiring more small business loan officers. In fact, BofA’s lending to small businesses rose 6 percent in the first quarter compared to the same time last year, and the bank approved more than $100 million in small-business loans. Clearly, somebody is getting a small-business loan.

The reject rate at BofA, JP Morgan and Wells Fargo likely is in part a result of entrepreneurs smelling blood in the water. Loans are getting made at these big banks, so more owners are applying there.

But the survey is certainly a reminder that it’s worth building relationships with your local, smaller community bank. Many of these institutions received federal funding to help spur more local, small-business lending, but fewer entrepreneurs take a look at local institutions.

One thing’s clear — if you’re looking for a loan for your business right now, have your financials cleaned up and looking as sweet as possible. Then, don’t be surprised if you need to apply to more than one bank to find a lender willing to help.

Finally, make sure your business can afford to take on this debt — interest rates for small-business loans aren’t cheap right now.


Adam Media Corp. Financing the Small Business: A Complete Guite to Obtaining Bank Loans and All Other Types of Financing
Book (Adam Media Corp.)
2010-11-22 16:10:15 by 1099Consultant

Best sources for Small Business Start Up Loans?

Hi,
Can anyone recommend some good sources for small business start up loans? I've tried to secure a small amount through some major banks, but all are shooting me down due to the fact that I don't have two years of self employment financials. I have a credit score of about 750, and very strong credit history. Does ANYONE loan money to new businesses, or start ups? Even like only $5,000, or less?

2009-07-15 20:02:58 by Pelham-Bay

Mortgages Are Now A Bank’s Best Friend

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For the last two years, housing has been at the center of the banking industry’s troubles. But for at least one quarter, it will help lift its results.
Even as banks remain cautious about lending and millions of borrowers still risk losing their homes, the mortgage business is returning as one of the most lucrative corners of the financial industry.
As independent mortgage companies and brokers shut their doors last fall, and major players like Bank of America, JPMorgan Chase and Wells Fargo swallowed up troubled rivals, lending profit margins widened, doubling at big banks amid a refinancing wave during the first half of the year, analysts said

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