Business Loan

Businesses looking for financing to grow and hire more employees won't likely find it in a bank -- at least, not for a long time. The New York Times reports that banks approve fewer loans while charging higher rates.

This Dallas Morning News article (may require free registration) confirms the trend that many businesses look beyond banks for loans. The article features a business that wants to expand its inventory after four years of steady business. The owner says that he tried going to banks, but they don't pay attention to a business' success.

From The Wall Street Journal:

"Small businesses on the hunt for working capital have seen some of the financing solutions of recent years all but shut down. Aggressive lenders...have pulled back in an uncertain credit environment, and options like home-equity loans have largely dried up as well.

inRich.com gives examples of small businesses that struggle to get a loan. One business took over a year to receive a loan and another found a bank turning down a loan despite good personal credit and money on deposit with the bank.

Instead of taking a loan from a business or a lender, entrepreneurs take out a loan from themselves by unlocking their own retirement funds. After all, they don't have to worry about credit checks, qualifications, and anyone (anyone = credit agencies) knowing about it.