Understanding and Obtaining a Business Line of Credit
Business lines of credit are an important part of the financial makeup of many successful companies.
Understanding the lender's criteria for qualifying your business will help you obtain the best terms for your line of credit.
To find out the major underwriting criteria read the article at the Seattle Examiner.
Comments (3)
Thanks Craig. Feel free to give me a call tomorrow. 214-580-1901 thanks Jon
Jon Klaus, almost 15 years ago
Jon, great question. For one, they're lowering the overall loan amounts as well as the percentage of loan offered on corresponding collateral. I've also noticed a nasty trend recently (which they used to do about 10 years ago as well) by lenders asking for personal guarantees on business lines. Some lenders are asking for liquid pledges of stocks and bonds on the part of the borrower, as well as hard collateral like taking a lien on real estate, business equipment, and even accounts receivables in some cases. In general, they're getting more conservative, going back to old tried and true underwriting methods and working off formulas that tie lines to balance sheets and net worth rather than just jumping on a loan to beat the competition. Hope that helps. Call me anytime for more info or if you're looking to secure capital for your business or real estate. -Craig
Craig Grella, almost 15 years ago
Craig, can you talk about what has changed in getting commercial LOCs over the past year?
Jon Klaus, almost 15 years ago