Wells Fargo strives to help small businesses grow, banker says

Wells Fargo recently earned the top ranking for providing capital to small-business owners in Northern Nevada and the state. The bank was the No. 1 lender to small businesses in Northern Nevada, making more than 3,100 loans of under $100,000, for a total of $64.8 million, according to the 2004 Community Reinvestment Act.

Chad Osorno, Wells Fargo senior vice president, is an 18-year veteran of the financial services industry. He helps small businesses succeed by providing an array of financial solutions. For information about Wells Fargo and how it makes lending decisions, stop by any of its offices or go to www.wellsfargo.com/biz. Osorno can be reached at 689-6140.

How has Wells Fargo succeeded in attracting small businesses?

Our mission at Wells Fargo is to help our customers succeed financially. Customers trust us with their business because we are their financial partner. We offer an expansive distribution network as well as a variety of products and services to meet their individual and unique needs both now and in the future. In addition to building lasting relationships with our customers, we also support the business community through organizations such as the Carson City Chamber of Commerce and the Northern Nevada Development Authority.

How does a small-business owner succeed in securing a loan?

There are generally five factors we use to assist us in making lending decisions:

Character: Wells Fargo's best clue to your character is your personal credit history. We always check to see how well you have managed your personal debt in the past.

Credit: Wells Fargo uses a credit-reporting agency to look at your payment history with trade suppliers and other business obligations. We also look to see that your payments to other financial institutions are current.

Cash flow: Wells Fargo is a cash-flow lender. That means we look at the cash flow of your business as the primary repayment source for the money we lend you.

Capacity: Wells Fargo wants to know how you would be able to repay your loan in case there was a sudden downturn in your business. Do you have the capacity to convert other assets to cash, either by selling them or borrowing against them? Your ability to do this could include real estate holdings, certificates of deposit, stocks and other sources of savings that can be liquidated quickly.

Collateral: We make both secured and unsecured loans. With a secured loan, you pledge something that you own as collateral. It might be personal assets like certificates of deposits or stocks, or business assets like real estate, inventory, equipment or accounts receivable.

How are the interest rates on the loans determined?

Every borrower and every loan is unique. The interest rate will be based on a variety factors, including length of the loan, size of the loan, credit rating of the borrower and the loan to value on any collateral.

How can a small-business owner maintain strong credit?

Building credit is important to growing your business. The more you know, the better chance you have of securing a loan. While there are several things to consider before applying - including your ability to repay - lack of a credit record makes it much more difficult to borrow money. If you have limited credit history, good places to start include trade credit, credit cards, auto loans, home equity and lines of credit. Using credit wisely will build a positive credit rating.