CIT

MSNBC states "CIT Group Inc.’s board approved a deal with major bondholders to keep the company out of bankruptcy with a $3 billion rescue loan, according to published reports. CIT’s failure could pose a major threat to the economy, industry representatives have warned. A collapse of CIT could cut off financing just as businesses need it most during the ongoing recession. Its failure could force thousands of companies to drastically cut costs or shut down — driving up unemployment and dashing hopes for a swift economic recovery"

Now that CIT has secured $3 billion to keep it's doors open for at least the rest of the year, one question small business owners should ask their state representatives is why the federal government doesn't see it necessary to bailout CIT when it bailed out all the big corporation from wall street?

Personal Credit and Small Business Loans

If you have a small business loan from CITI Bank, you are likely to see that loan show up on your PERSONAL credit report. But not to worry, according to Sharon O'Connor Clarke, a principal consultant with FICO, "Business owners generally won't see their credit hurt if they're current on payments. Borrowers with strong repayment histories could even see scores improve" This doesn't mean for the sake of improving your personal credit you start taking out business loans but it does mean even though banks are changing the rules of the game, for now, you don't have to worry.

Small Business Administration (SBA) boosts lending

As of June 15th the SBA has taken steps to help small business owners who have been hit hard during this economic crisis. According to The Business Review "The SBA began accepting applications for emergency bridge loans of up to $35,000. Small businesses can use these loans, which were created by the economic stimulus bill, to make up to six months of payments on existing debt." The SBA will allow a year, after the last disbursement, before loan payment begin, giving small business owners the small breather, some desperately need