How To Get Business Credit And Commercial Loan Solutions

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ACCESSING COMMERCIAL LOANS IN CANADA

As a Canadian business owner and financial manager, you realize you need business credit or a commercial loan, if not all the time, some of the time. Let's dig in on commercial and corporate loans, lending, and financing in Canada.

SMALL BUSINESS LOANS AND LINES OF CREDIT

Funds for your business are required for what everyone refers to as ‘working capital. That challenge is wrestled with every day by your firm – purchasing inventory, paying employees, investing in assets, and, unfortunately, waiting for customers to pay. And you of course are still waiting – for those customers to pay.

HOW DOES BUSINESS CREDIT WORK?

Business credit is achieved in a variety of manners from everything to short-term working capital loans to the use of a business credit card.

FINANCING THAT SUPPORTS GROWTH

Financing alternatives are available for the start-up firm to major corporations – there are only 4 ‘minor’ challenges around those alternatives.

We can safely say that if your company is creditworthy, has solid financials, is profitable, is in the right industry, and has lots of assets and collateral you can be financed in totality by a Canadian charted bank.

FLEXIBLE LOAN OPTIONS

But there are thousands of SME businesses in Canada that don’t have those qualifications to secure funds, but they still require :

If your business can’t access all the financing you need then it's time to look at some of those options and alternatives we spoke about. Receivable financing is right up there today in popularity as the business struggles to maintain positive cash flow in their business account.

Also called ‘factoring’, it is the immediate sale of receivables that generates immediate working capital for your firm. It is easy to obtain, efficient, and eliminates a lot of the requirements that come with typical lending standards. Under this receivable financing solution funds are deposited into your business bank account immediately as you generate sales and deliver products and services to your client base.

This is probably the fastest-growing part of business financing today in Canada, and we encourage business owners to speak to a credible, successful and experienced expert in this field to ensure they understand the basics around cost, daily paperwork flow, and potential pitfalls around some of the loopholes some factors insert in their paperwork with your firm.

One of Canada’s quasi-government entities offers a specialized working capital term loan. The loan is essentially unsecured, has a competitive interest rate, and injects positive and permanent working capital into your firm. Check out that option.

Many clients always refer to the term ‘Government grants and loans from other financial institutions. The two most popular programs, if we can call them that, are:

Government Small Business Loan - A good personal credit score is required for credit approval under the term loan program known as the Canada Small Business Financing Program - ( It is important for business owners to know how to build business credit ) -This is not a cash flow loan to cover operating costs, unlike a business credit line. Funds are used for equipment, leasehold improvements, and acquiring commercial real estate. Participating financial institutions under the program are primarily banks and credit unions. Loans are structured as term loans, typically 2-5 year term at competitive interest rates. The maximum approved credit limit for the program is 1 Million dollars and many small businesses, start-ups and franchise purchasers use the program.

Borrowers should also consider a BDC small business loan if they can meet bdc small business loan requirements as well as the requirement for a good credit score for the owner/owners.

SR&ED program which provides non-repayable grants for your research and development. The former, the infamous ‘SBL' loan, finances equipment and leaseholds at great rates, term, and structures, with even limited personal guarantees. There are no monthly payments and customers pay interest which simply accrues until the government funds the SRED

CONCLUSION - BUSINESS LOANS IN CANADA

So what's our bottom line on business credit and commercial loan alternatives – keeping it simple, we can say that you should be aware of alternatives - they do exist. Traditional financing is available, and alternative financing is abundant – Business Loans To Help Your Business Grow! Speak to 7 Park Avenue Financial and we will work through the mechanics with you with our experience - determining what type of business credit options work for your growing business.

How does a commercial line of credit work? Commercial Loans And Lines Of Credit

' Canadian Business Financing With The Intelligent Use Of Experience '

Stan Prokop is the founder of 7 Park Avenue Financial and a recognized expert on Canadian Business Financing. Since 2004 Stan has helped hundreds of small, medium and large organizations achieve the financing they need to survive and grow. He has decades of credit and lending experience working for firms such as Hewlett Packard / Cable & Wireless / Ashland Oil

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