YOUR COMPANY IS LOOKING FOR COMMERCIAL ASSET FINANCING SOLUTIONS!
THE ASSET BASED LOAN FROM ASSET BASED LENDERS
You've arrived at the right address! Welcome to 7 Park Avenue Financial
Financing & Cash flow are the biggest issues facing business today.
ARE YOU UNAWARE OR DISSATISFIED WITH YOUR CURRENT BUSINESS FINANCING OPTIONS?
CALL NOW - DIRECT LINE - 416 319 5769 - Let's talk or arrange a meeting to discuss your needs
EMAIL - sprokop@7parkavenuefinancial.com
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Oakville, Ontario
L6J 7J8
FLEXIBLE FINANCING VIA ASSET LENDER COMMERCIAL LENDING SOLUTIONS
Commercial lending by banks in Canada is not the only way in which Canadian business finances itself. When we talk to clients about non-bank solutions there sometimes exists a certain level of ' discomfort'.
THE ROLE OF THE ASSET BASED LENDER IN CANADA
Where it comes from we don't know, as thousands of firms in Canada are financing via secured loans by non-bank methods.
That’s the role of what we call the ' Asset lender ' - who comes in all shapes and sizes! Let's dig in. ABL Lenders prefer assets that will easily turn into cash if the borrower defaults on payments.
WHAT IS ASSET BASED LENDING?
Generally speaking, asset-based lending is simply a broad term for non-bank commercial finance firms that provide a variety of business lending solutions using assets as collateral to the Canadian business owner/manager. These companies have carved out their own ' niche' when it comes to specialty lending in areas of equipment, current assets, tax credits, etc.
Asset-based loans are also known as ' ABL' loans and are focused on collateral your company can provide based on your assets and sales. While the bank lender focuses on cash flows the ABL approach hones in on the ability of your sales and assets to cover the loan payments. Even well-known larger corporations have utilized asset based loan solutions.
THE GROWTH OF ASSET BASED LOANS
Why then are commercial asset lenders successful in Canada in funding sales and balance sheet assets , and growing in size and scope for the solution? The reality is that they aren't regulated like the Canadian banking system requires of unsecured loans from our commercial banking traditional financial institutions - So like your teenagers they (try to) do what they want! And pretty well all of them do that well.
THE ABL FOCUS - SALES AND ASSETS!
Commercial lending solutions for the asset lender come in a variety of solutions - they include term loans, leases, and asset monetization for working capital and cash flow. The loans are almost always focused on... you guessed it... assets! Asset-based financing often has less regard for your company's overall credit quality or its past or current situation - however, don't think that because your company is in a death spiral, you will still qualify. The patient must show signs of life! Approved borrowers like the flexible repayment terms and fast credit approval. Loan terms are typically 1 year and constantly renew.
THE NON-BANK ASSET BASED LINE OF CREDIT / REVOLVING LOAN
Certain types of asset finance focus on particular industries. Non-bank asset-based lines of credit offer revolving credit facilities for almost every type of company in Canada that can offer up some form of collateral via accounts receivable inventory and fixed assets, tax credits, and even real estate. A constant borrowing base is established, allowing you to draw down on funds as you generate sales and require cash.
Borrowers should be prepared to supply regular monthly financial statements and appropriate agings of asset categories such as accounts Receivables and Inventory. Also, physical assets such as commercial real estate or a specific asset or fixed assets for equipment financing as a part of the facility can also be bundled into your business credit line if they are a part of your company's assets.
Interest rates are higher on asset-based loans, but they provide the capital you need to grow your products and services sales.Asset-based lenders may grant up to 90% of the face value of highly liquid security such as accounts receivables, and 60% for commercial real estate.
At 7 Park Avenue FInancil ' ABL' (ASSET BASED LENDING) lending can be of a ' hybrid ' nature- financing different assets of your firm in a similar manner, all under the same credit facility.
DEBT FINANCING / EQUITY FINANCING .. OR CASH FLOW FINANCING?
Many Canadian business owners and financial managers in Canada seek asset finance solutions because they are an alternative to equity financing. In certain larger transactions, an asset or mezzanine lender might in fact though ask for small equity ownership or option in your firm - but this is generally very rare.
The appeal of asset lenders is that as your business and assets grow, your financing capability with your chosen lender grows. Whether it's inventory financing or receivable-based factoring solutions asset-based loans work! Cash flow loans are a type of loan that is better for service companies with high margins or low-margin products.
CONCLUSION
We mentioned previously here that if your firm is in a death spiral your hopes should not be high for asset financing success. But if you are in legitimate turnaround mode you are absolutely a candidate for this financing which otherwise could not be achieved through a bank.
Whether you are a small business or a larger firm speak to 7 Park Avenue Financial, a trusted, credible and experienced Canadian business financing advisor who can assist you in structuring asset lender solutions that meets your business needs and growth opportunities when it comes to commercial lending in Canada for your long term financing needs.
FAQ: FREQU ENTLY ASKED QUESTIONS
What is Cash Flow Lending?
Cash flow lending is a method of financing that uses the cash from already-existing enterprises to lend money against future cash flows.
