The most recent Federal Reserve quarterly survey of banking loan officers revealed that conditions for business loans have become more flexible and credit lines are no longer being reduced, boding well for entrepreneurs forming an LLC and looking for capital.
For the first time since 2006, major U.S. banks are reporting their lending standards are being loosened, opening up loans and credit for more small businesses. With many entrepreneurs looking for startup capital, the easing of loan terms could provide new sources of financing.
According to MarketWatch, banks loosen standards for commercial and industrial loans by lowering credit score requirements, increasing lines of credit, requiring smaller down payments or charging lower interest rates.
The Federal Reserve reported that as many as 20 percent of large U.S. banks have eased lending for small businesses. For the first time since January 2009, most banks have stopped reducing credit limits for existing borrowers and customers.
President Barack Obama has been touring the country and pushing for Congress to pass the Small Business Jobs Creation Act, aimed at making more capital available to small businesses. Obama also supports a proposed bill that would allow credit unions to increase their percentage of small business loans.
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