If you are a small business and you have decided to ask your financial institution for more credit by extending your loan or bank overdraft in 2012, then I would strongly suggest that you think carefully about the unresolved financial crises still happening in the Eurozone. This crisis is not fixed or over yet, and this will be making credit providers very leery of extending loans to anyone.

There is no financial institution on earth who wants to be the one left with so much credit debt on their books that it makes shareholders in their financial institutions withdraw their backing by selling their shareholding.

Banks and other financial institutions have to satisfy their shareholders and if the shareholders are not receiving adequate dividends then they are more likely to withdraw or sell their shares and buy into another bank or into a higher dividend paying investment.

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When there are so many self-funded retirees now depending on their investments and the dividends they provide to either fully fund their retirement or to ‘top up’ a pension;  any decrease in their income means a lower lifestyle choice. Many of these self-funded retirees have had their retirement dreams squashed due to the Global Financial Crises (GFC) in 2008.

So for any individual or small business looking for new credit in 2012, you will have to have either an exceptional credit record or an exceptional credit rating. And if you just have the highest credit rating then you will still need the assets to cover that debt with a lot left over!

When countries with a good track record of repayment have to pay a higher rate of interest on their borrowings then it should start to ring alarm bells for you. Something in the global financial world isn’t working so the best advice I could give you is to remove yourself rather than seek new credit.

If you are after a new credit line to extend or renovate your house or to fund a business expansion, then putting this off until 2013 could be very advisable.  Paying down existing debt and lessening your exposure to the banking industry fluctuations or fallout could make you much more financially comfortable rather than seeking new credit at this time.