One question that arises a lot with new business owners relates to getting a business loan in a struggling economy. The recent 18 months of economic upheaval have affected many facets of business. People are more reluctant to spend money, they are not buying as many large ticket items as they used to, and banks are more reluctant to give out loans for businesses.

So many people come to me asking for advice on where they can turn for money when it’s difficult to get business loans. The advice that I offer is what is listed below.

1) Securities-Based Lending

One of the best places that a business owner can turn to for business loans in a bad economy is securities-based lending. It’s a form of business loan that is very inexpensive, because the business owner is borrowing money either from themselves or from the partners that they have. For example, if a business owner has had success and they have put money away in an account that they have for investing, they can use that money as collateral to borrow against. This can allow some flexibility and means that original funds don’t have to be taken out of the company.

Note – the terminology for this varies from country to country but the basic approach is the same.

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