Jim Lundquist has spent much of his career placing financing for his clients and the businesses he ran. With over $300 million in financing placed over the last 28 years he has developed extensive experience.  He has successfully completed over 65 transactions including equipment financing, working capital, real estate, institutional senior and subordinated debt and asset securitization.

Current State

It goes without saying that the current financing environment is the worst in many decades. The banks say they are lending money - but they aren't. Traditionally healthy "cash flow" borrowers are being moved into the asset based lending divisions due to technical defaults. Many borrowers in the asset based lending divisions are being moved out of the banks into factoring and pseudo factoring financing companies at very high costs.

Your local banker that has supported your needs may have been moved

to another part of the bank, or simply removed as the banks consolidate and restructure.

We have gone through some of this in the past - but not to this degree. In past turmoil - things returned to a resonable level of difficultty in a couple of years. It may not return to normal until 2012 or later this time.

What can you do?

The most important thing to do with the banks and financing companies is to be straightforward with them. The banks have heard all the bad news they need to hear. The banks are working with those customers that have credibility and a good business (even though they may be in default). They are very quick to move on those customers in default that have not been straightforward with them.

Make sure your projections are acheivable. Make sure you perform reasonably close to the projected numbers. If you are not going to hit the projections or you receive irreversible bad news, make sure you make the bank aware of it.