We are focusing on Micro loans because we know that many small businesses need credit, and they are having difficulties accessing it through traditional bank loans.
San Francisco, CA (PRWEB) March 26, 2013
Small business owners today are still unable to access capital. Small banks, who typically lend, are under the gun with new regulations aimed at large banks. "Small banks may also have bad legacy loans on the books that must be dealt with before new lending can occur", says Terry Robinson, President of Sunovis Financial. "Tighter credit restrictions and larger down payments also hurt many small businesses, whose credit scores may have slipped since 2008. But business needs capital to grow," says Robinson.
What are some small businesses doing now as we march into 2013? Turning to alternative non-bank financing. Forbes Magazine says a good definition of the up-and-coming alternative lenders include non-bank lending institutions that will often lend to business owners that can’t get (or choose not to get) a loan through a more traditional bank or credit union. Alternative lenders either use non-traditional forms of collateral to underwrite the loan and/or price the rate higher to account for the increased risk.
There are no official statistics for microlending, but a study from the Opportunity Finance Network, which surveyed 118 of the nation's 260 microlenders, showed that 63 percent reported an increase in applications for microloans during the fourth quarter, wrote Dan Weil at bankrate.com.
Sunovis Financial offers this very solution today: short-term micro loans for businesses. These loans are from $5,000 to $250,000 and are underwritten based on cash flow, ability to repay and other factors more than credit history or collateral. The ideal small business, says Robinson, has a daily cash flow, a minimum of $100,000 annual revenues (but higher will enhance approval ability), and has been in business for at least a full year.
Terms are as short as 4 months and as long as 18 months, with the average being about 7 or 8 months. Many small business owners will renew the micro loan several times, gaining the capital needed to grow and thrive.
"We are focusing on Micro loans because we know that many small businesses need credit, and they are having difficulties accessing it through traditional bank loans. The process here is short - a few days for an offer of terms and a fast closing turnaround to fund," said Robinson. Requirements are only a 1 page application along with 4 months of bank and credit card statements. The underwriting is all about the cash flow and ability to repay, less on credit scores. No collateral or down-payments are involved.
"Our mission is rebuilding the U.S. economy, one business and one loan at a time, and Micro Loans will help fulfill that mission," said Robinson.
About Sunovis Financial
Sunovis is a financial services firm assisting small businesses and small banks with SBA services as well as Micro loans. Sunovis can also handle commercial real estate financing and refinancing for borrowers.