Banks, credit unions and other lenders have tightened business credit in recent years, and they don’t seem ready to loosen anytime soon. So small businesses in position to expand are having trouble finding the money they need, and are looking at alternatives.
One of those may be borrowing from a family member or friend. According to SCORE, a nonprofit association of retired executives and business owners who assist small businesses, investments by family and friends account for more than half of all investment dollars for startup businesses.
Of course, loyal family members and true friends might loan you money just because they
