CIT's Bankrupty Filing Seems Inevitable

Unless a white knight arrives, CIT's bankruptcy filing is inevitable. Small businesses affected by CIT should seek alternative financing to ensure their survival. Getting a business bank loan is literally impossible in the current environment and it takes too long. If your company is starving for cash, consider invoice factoring. The application process is short - most factors have a 1 to 2 page application and the approval process is usually a few days vs. bank loans which can be 30 to 45 days or more. Contact ACD Financial Services (http://www.acdfinancial.com/) if you need cash now to keep your business operating.

from Inc.com

CIT Group, the nation's largest commercial lender that provides loans to roughly a million small and mid-size businesses, is facing the possibility of failure after being denied a second round of government bailout money. Last week, CIT received the bad news that the Federal Deposit Insurance Corporation would not provide the company some relief by granting access to its debt guarantee program.
"We have a comprehensive and aggressive strategy to restore stability to the financial system," the Treasury said in a statement. "Even during periods of financial stress, we believe that there is a very high threshold for exceptional government assistance to individual companies." Last Wednesday, CIT issued a brief statement announcing that there was "no appreciable likelihood of additional government support being provided over the near term."
For small businesses with loans from CIT this could spell disaster, but analysts don't suspect the ripple effect will be big enough to warrant government intervention. Some customers began drawing on their credit lines last week, adding to an already mounting pressure onto the endangered company. Dr. Kim Jones of the Stoney Brook Veterinary Hospital in Lebanon, N.H., took out a $1.3 million loan from CIT in June 2008. "I don't know what it will do to me," she says, "they have to do something, the money has been spent, the money is done."
Unless a buyer quickly surfaces, the century-old lender could be heading for bankruptcy, despite the $2.33 billion taxpayer-financed bailout they received last December. "Earlier in the year, when the other big banks were having trouble, I asked my contact person if I should be concerned," Jones says, "and she replied that CIT had plenty of liquidity. Now I don't know."