Wonder why your bank seems loath to lend? Bank of America says it took a permanent loss on about 2.9% of its small-business loans in the last quarter of 2008 -- which projects out to double the normal annualized rate. Capital One says its rate of nonperforming small-business loans has soared 70% in the fourth quarter. And at the SBA, losses on lending programs reached almost $1.3 billion last year, compared with $504 million in 2007. Tighter business lending means more entrepreneurs are resorting to personal cards and lines of credit, setting up potential problems down the road.

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