More banks tighten commercial loan standards

Commercial real estate loans are now almost as difficult to obtain as subprime mortgages. The Federal Reserve recently surveyed senior loan officers from 84 large domestic and foreign banks, and 87 percent said they had tightened their lending standards for commercial real estate loans in the fourth quarter of 2008, up from 50 percent in the fourth quarter of 2007. One hundred percent of the loan officers said they tightened standards for subprime loans during the fourth quarter, an increase from 55.5 percent during the same time last year. Dan Fasulo, managing director of Real Capital Analytics, said the data underscored a “disturbing” trend. “There’s just too much debt that needs to be refinanced within the next year,” he said.