By Maria Anton
Small businesses seeking loans got some good news this week, the Chicago Tribune reports, as CIT Group, a major lender to small and midsized companies, announced that for the next three months it will waive fees on all approved Small Business Administration loan applications. CIT Group also announced it would commit $500 million to small-business lending in 2010.
Back in 2008, CIT ranked as the number-one SBA lender in dollar terms, accounting for 6 percent of all SBA loans. However, the company’s lending to small business had declined dramatically by the time it declared bankruptcy in November. In the first six months of this year, CIT accounted for just 1 percent of all SBA loans.
Fresh out of bankruptcy protection last week, CIT is seeking to regain its position as a key commercial lender. The $500 million will fund SBA 7(a) and 504 loans; CIT will waive the $1,000 packaging fee on all applications for 7(a) loans through March 10.
At the time of the bankruptcy, some experts had estimated CIT’s bankruptcy could leave as many as 1 million small and midsized companies in the lurch. Hopefully this move will help many of them get the financing they need again.
This is good news for small business owners, being that most banks aren’t lending anymore. Small businesses are very important to help stabilize the economy. Hopefully this will start a new trend for the coming year.
I really hope this will help out the small businesses that are struggling. So many have sought out small business loans but have been unable to acquire one, and it has put a huge dent into their finances. Many of these businesses have had to turn to business cash advances in order to get the finances they need.
Yes this type of alternative funding is really crucial to help businesses get through these tough times.