Personal finance and high corporate finance aren’t as different as you may think. Some of the biggest companies need guaranteed loans, or a line of credit or short term installment loan. Even the Ford Motor Company got guaranteed loans eventually. Ford is getting out of debt in double quick time. Fannie Mae and Freddie Mac need guaranteed loans just to stay above water.
Ford gets guaranteed loans
The government lent the Ford Motor Company $ 23.5 billion before they needed bailout cash and to file bankruptcy. Ford only asked for emergency lines of credit if necessary, and didn’t need a bailout. Ford not asking for bailout funds was maybe the best business decision they’ve made in a while. While Chrysler and General Motors were figuring things out, Ford’s sales went up 22 percent, as outlined by the Wall Street Journal. Sometimes if you know can get a loan till payday if you absolutely need it is a confidence boost.
More guarantees needed for mortgage giants
Freddie Mac and Fannie Mae need more, nevertheless, in guaranteed loans. According to ABC, Freddie has lost about $ 6 billion for the second quarter of this year alone. The money hemorrhaging firm is asking for one more $ 1.8 billion from taxpayers. The twin mortgage giants are struggling, and both have less than two years to get their affairs in order. At that point, Treasury Secretary Geithner won’t write any more checks.
Fortune 500 businesses have credit scores too
One of the motivations for Ford is the credit rating for the agency improves as they pay off debt. The biggest corporations benefit from paying down debt, just as a regular person gets a better credit rating when they pay back their credit card.
Further reading
online.wsj.com/article/SB20001424052748703589404575417491742322262.html
abcnews.go.com/Business/wireStory?id=11356950
