Corporate finance and personal finance are not as different as you would think. The businesses which need some guaranteed loans at a while, or at least a line of credit in case they need a short term installment loan are some of the biggest names out there. Even the Ford Motor Company got guaranteed loans eventually. Ford is in debt relief mode. Fannie Mae and Freddie Mac need guaranteed loans just to stay above water.
Ford gets guaranteed loans
During the worst of the recession, the Ford Motor Co. borrowed $ 23.5 billion to stay afloat and keep Ford from having to file bankruptcy and ask for bailout cash. Ford didn’t need a bailout, but only asked for lines of credit be set aside just in case. Not asking for emergency cash loans from the government was a wise business decision. . Sometimes just knowing you can borrow can give a boost of confidence; some people like knowing they can get a pay day loan if they really need it.
Mortgage giants need more guaranteed loans
Freddie Mac and Fannie Mae need more in taxpayer funded guaranteed loans. According to ABC, Freddie has lost about $ 6 billion for the second quarter of this year alone. The firm is asking for one more $ 1.8 billion. The twin mortgage giants are struggling, and both have less than two years to get their affairs in order. That’s when the Treasury Department’s teat will run dry.
Credit scores affect huge businesses too
Ford will be able to get better loans, as they pay down debt and improve the company’s . Just like paying off a credit card improves your credit rating, it works for large corporations too.
Discover more information on this subject
online.wsj.com/article/SB20001424052748703589404575417491742322262.html
abcnews.go.com/Business/wireStory?id=11356950
