YOUR COMPANY IS LOOKING FOR BUSINESS FINANCING FROM SPECIALTY LENDERS - THE NON-BANK SOLUTION!
SMALL BUSINESS FINANCING .. SOLVED!
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?
CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Oakville, Ontario
L6J 7J8
Direct Line = 416 319 5769
Email = sprokop@7parkavenuefinancial.com
Business financing loans from specialty lenders continue to have a strong appeal to business owners and financial managers faced with the challenge of growing (and running!) their business.
What is the appeal of specialized non-bank financing for business lending, and why should they be considered an alternative solution to more traditional funding? We're doing some ' fact-checking for you, so let's dig in on Specialty Finance lenders!
WHAT IS A SPECIALTY FINANCE COMPANY
Specialty finance firms in Canada are non-bank lenders, typically non-regulated, that provide business loans to small and medium-sized companies in Canada when traditional bank financing may not be available to a firm.
WHAT DRIVES THE NEED FOR BUSINESS FINANCING
Two fundamental factors that drive the small business need for financing around business loans include the size and ‘life-stage ' of your company (i.e. start-up, growth mode, mature business, etc.) The other key factor related to this is the owner/financial mgr decision to take on more debt or, alternately, seek out more owner equity. Remember also that many forms of specialized financing, including:
A/R Financing - trade-credit factoring
Inventory Finance
Sale Leasebacks
SR&ED Tax credit financing
In fact, it can solve your problem without bringing on any new debt to the balance sheet. That's because those solutions we've named actually monetize assets you already have. In many cases, owners' credit score is not as important an approval factor as in traditional financing when it comes to accessing approval for term loans or a business credit line.
WHAT SECURITY OR COLLATERAL IS REQUIRED BY THE SPECIALTY LENDER?
Many clients we meet are confused about what documentation and security are required for various alternate financing types. While many solutions from specialty finance lenders that are non-bank in nature differ from bank financing, the reality is that much of the documentation around these financings is quite similar. That includes GSA’S (General Security Agreements), which are the backbone of more senior all-encompassing facilities, as well as personal guarantees from owners.
The personal guarantee issue for owners tends to be a thorny one, and as a general rule, it can be said that less ' reliance' is placed on those ' PG'S ' that are the bane of the entrepreneur. Higher Interest rates are more prevalent in alternative finance: the business owner's questions become one of access to capital versus cost of capital.
GOVERNMENT LOANS
We make the case that one other form of alternative finance that can be considered more ' traditional' in nature is often overlooked. That's the 'Govt of Canada Guaranteed Small Business Loan' program. Recent changes to limits definitely favour the start-up or emerging firm in the small to medium-sized commercial finance arena.
When it comes to small business loans in Canada, Canada, Small Business Financing Program for a small business loan/startup loan is one of the best and most accessible solutions. Rates for the program can be a variable interest rate of fixed - the choice of the borrower. You can repay the loan over a typical 2-5 year term, and we note that a limited personal guarantee is only required. In small business government loans, credit score and personal credit history must be acceptable when applying for business credit under the program.
The program finances equipment, technology, leasehold improvements, and real estate, and the typical loan credit limit/loan amount is 350k, although real estate can be financed up to 1 Million dollars. Loans and lines of credit should not be confused by the program - the term loan is the finance solution - it is not a lump sum loan/line of credit.
Banks and credit unions are the financial institutions that administer the program. Any business can apply, even a proprietorship. Let the 7 Park Avenue Financial team walk you through the program and be your guide to getting approved!
HOW DOES THE APPLICATION PROCESS FOR GOVERNMENT SMALL BUSINESS LOANS WORK?
The application process is viewed as cumbersome by some, and 7 Park Avenue, Financial business plans for the program, meet and exceed bank requirements. A business plan is a typical requirement for many types of financing or bank loan. Any company/business with less than 10 Million dollars in revenue can apply for the government SBL loan. There is a one-time processing fee due on approval, and that fee can be bundled into the loan.
ALTERNATIVE LENDING SOLUTIONS
While assets, cash flow and profits, and reasonable owner equity are key requirements for bank financing for a line of credit/term loan in Canada, the broad appeal of specialty financing is that not every one of these requirements has to be in place for business financing loans from specialized commercial finance firms.
These firms include:
Equipment Lessors
Merchant Cash Advance/ Business Credit Card - flexible repayments terms tied to your cash inflows
Factoring Companies
Asset-Based Lenders - non-bank lines of credit
Merchant Advance companies / Working Capital Small Business Loans
Sales Royalty finance companies
Real Estate Bridge Loan Lenders
While financing solutions specialty lenders and non-bank lenders don’t necessarily focus on firms that are in somewhat of a distressed financial position, the hardcore reality is that the solutions they offer are, in fact, often perfectly suited to ' righting the ship. ' By the way, even firms in the process or state of bankruptcy have access to specialized lending, which can often save the company. At that point, it is rarely about the interest rate!
CONCLUSION - BUSINESS BANK OR ALTERNATIVE FINANCE?
If you're looking for some serious ' fact checking' on business loans and forms of non-bank financing that will work for your firm, speak to 7 Park Avenue Financial, a trusted, credible and experienced Canadian business financing advisor who can assist you with your business financing loans and asset monetization needs for small businesses in Canada.
Click here for the business finance track record of 7 Park Avenue Financial
