A Few Points How COVID Has Changed Commercial Lending
Below are some brief points regarding how commercial lending has changed the past few months due to COVID as well as some general facts regarding the industry and small business in general. I am putting the information in simple bullet points due to the information covering many subjects.
The few dozen lenders JCF works directly with fall into one of 3 categories.
- Have paused taking applications entirely.
- Have tightened up on underwriting guidelines.
- No changes whatsoever.
- Lenders definitely look at industries differently. For example, a restaurant would go through much more scrutiny while an excavation company is pretty much business as usual.
- Working Capital loans have been virtually non-existent. This has caused me to search for another lender offering Working Capital which I have now recently partnered with.
- If your business has taken out a payroll protection plan (PPP) there are still no processes in place to begin repayment. General consensus is that Congress will eventually forgive all loans under $150,000.
- It is this time of year where businesses begin to consider making some ‘end of the year’ equipment purchases to take advantage of IRS Code Section 179. (This allows 100% write-off of equipment put in use by end of the year 2020)
- Most lenders still have programs set up for businesses to ‘pause’ their payments if there is a hardship. With the industries that JCF mostly services I have seen very few examples of this service needed.
In Summary, the blue-collar self-employed industries are faring very well as interest in financing and funding loans has not dipped outside of April and May. The services the majority of my client's offer are deemed essential. From logging, to trucking, to excavation, landscaping farming, and more. All in all, I feel the self-employed ranks have become a closer-knit community then before and I am proud to help in any way I can.
Have a great October!
"One cannot and must not try to erase the past merely because it does not fit the present."
Did You Know???
Random Facts About Space
- One million Earths could fit inside the sun – and the sun is considered an average-size star.
- For years it was believed that Earth was the only planet in our solar system with liquid water. More recently, NASA revealed its strongest evidence yet that there is intermittent running water on Mars, too!
- You wouldn’t be able to walk on Jupiter, Saturn, Uranus or Neptune because they have no solid surface!
- The highest mountain known to man is on an asteroid called Vesta. Measuring a whopping 22km in height, it is three times as tall as Mount Everest!
- There are more stars in the universe than grains of sand on all the beaches on Earth. That’s at least a billion trillion!
- The sunset on Mars appears blue.
Just for Laughs!
A lawyer runs a stop sign and gets pulled over by a sheriff. He thinks he's smarter being a big shot lawyer from New York and has a better education than a sheriff from West Virginia. The sheriff asks for license and registration. The lawyer asks, "What for?"
The sheriff responds, "You didn't come to a complete stop at the stop sign."
The lawyer says, "I slowed down and no one was coming."
"You still didn't come to a complete stop. License and registration please," say the sheriff impatiently.
The lawyer says, "If you can show me the legal difference between slow down and stop, I'll give you my license and registration and you can give me the ticket. If not, you let me go and don't give me the ticket."
The sheriff says, "That sounds fair, please exit your vehicle." The lawyer steps out and the sheriff takes out his nightstick and starts beating the lawyer with it.
The sheriff says, "Do you want me to stop or just slow down?"