Government Contractor & Business Funding

First Federal Advance: 888 342-4FFA

The days of getting loans by showing lending officers a list of signed government contracts are over.

Banks have stopped accepting contracts as proof of creditworthiness for small companies, in growth capital in the form of a term loan.

Companies need to hire more employees, purchase furniture, buy other capital equipment and pay the rent on office space. The companies hire employees and is rely on cash flow to meet the  payroll.

It limits companies ability to do everything.

While financial and public-sector experts do say that banks are looking harder at credit risks, some experts say that things haven’t really changed all that much.

In the current environment small business owners that serve government customers  find it more difficult to borrow even against the accounts receivable generated from contracts, depending on the type of contracts they hold and the products or services they are selling.

The struggles common to small business even in good times have become greater in today’s tough market.

Banks assess the overall financial strength of a small business contractor: How long has it been in business? Is there a contract backlog? What agencies is it serving? Who’s on the management team? And more.

Customers with otherwise good credit might not be the right customers for banks having trouble.

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