Argh! We just received another rejection for a business loan. I just don't get it. In spite of the fact that George and I are sitting on $185,000 in cash that we are investing in this restaurant, we cannot seem to get a loan for $100,000 from a bank.
We've been rejected from supposedly consumer / business friendly banks such as:
Chase
Community Capital Bank
Commerce Bank
Citibank
and New York Development Corporation
The problem? "Not enough assets to cover the loan." Not enough collateral.
It's frustrating. In spite of the fact that we are both committed and have been since this process started, we have excellent credit scores, have management experience, won a $10,000 business plan competition, have excellent community relations, are disciplined, I also own my apartment, we have a great space and location with a great lease, blah, blah, blah... we can't get this necessary amount to give us the green light to proceed. We've got so much going for us but none of these damn banks are willing to take a chance on us. Not even Chase Bank, with whom I've done my banking with for close to 20 years was willing to give us a loan.
We did meet a loan shark who has offered to get us a loan but at terms that I am very not comfortable with making that option a nonstarter.
I had a meeting a few months ago with a representative from the Small Business Development Corporation ("SBDC") who told me, "Banks are scum. They're not there to help the little guy. You shouldn't even bother wasting your time applying with them."
He wasn't kidding. Citibank, for instance, never even bothered returning my numerous phone calls and emails in spite of being told by a rep. there that the loan was practically approved. We followed up countless times, calling him at the office, on his cell, sending emails to him and to his colleagues at Citibank wondering what happened and what the status of the loan was. Nothing. I sent out a group email to Citibank last week to several contacts who were, in one way or another, connected with this loan, wanting a status report.
Nothing. No reply. No response. Nada. Zilch. No return calls. No return emails. It's as if we dont' even exist to them. Sadly enough, when I last met with the banker it was at an entrepreneurial workshop where we were both asked to speak. It was purely coincidental that we both were there. This was the same workshop I had taken last year from which I and George had graduated. After the workshop was over, he whispered to us, "We don't loan to these kinds of people or these kinds of businesses." Knowing that I too was like "these people", I felt offended but didn't say anything. "Expect to hear from me next Tuesday. We're pushing this loan through for you."
That was in early June. I haven't heard from him since. Again, we called and sent emails. No response. None whatsoever. I guess he wasn't kidding. Citibank doesn't deal with people like us. We're too small for them. We were never even granted the professional courtesy of a phone call from them with either a 'yes' or 'no' answer.
We've decided to no longer beat a dead horse and have come to assume the answer is "no."
Silence can be louder than words.