Half of all small businesses are home-based according to the SBA Office of Advocacy. But the SBA guaranteed fewer loans in FY2008, but only because of a â€œperfect stormâ€ of tightened credit by commercial lenders, declining creditworthiness, and reduced demand for loans from small business borrowers uncertain about the future.
SBA posted a record year in 2007 with nearly 100,000 loans approved, but that number dropped by nearly 30 percent in 2008. (About 1% of small business have SBA loans). Oddly, average loan size increased from $142,000 to $183,000 between FY2007 and FY 2008. But the good news is these loans may actually contribute to more sustainable and successful small businesses. You start off with more money, you’re more likely to succeed, in other words. Or at least last longer.
According to the National Federation of Independent Businesses (NFIB) only 3 percent of the owners cited the cost and availability of credit as their primary business problem, far from the record 37 percent reached in 1982. Additionally, 34 percent reported that they found the money they needed, compared to 5 percent who reported problems obtaining financing. (The remainder did not want/need to borrow).
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