Helpful Commercial Finance Asset Based Lender Solutions In Canada

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Do commercial finance solutions seem out of reach! Do You want a simple solution?... Visit a Canadian chartered bank and get all the business credit you need! Unrealistic... maybe, maybe not, but one sure-fire solution for your problems might be non-bank commercial lenders, aka " asset based lender s."

ASSET BASED REVOLVING LINES OF CREDIT AND TERM LOANS

For many years now, the non-bank asset based lenders have been working with firms such as yours on credit facilities that fit the real-world need of your company when it comes to inventory, receivables, equipment and real estate.

DO CANADIAN BANKS OFFER ASSET BASED LENDING?

Canadian business owners and financial managers are probably asking themselves why they haven’t heard of this before - we'll hit you with another shocker, some of the participating Canadian asset based lending banks even have internal divisions of ABL finance, asset based lenders that compete with their regular commercial banking business!

BANK FINANCING REQUIREMENTS

The challenge of working with banks as ABL lenders is that a minimum borrowing size is often in the 5 Million dollar range, outside the needs of the majority of SME/SMB borrowers. Asset based loan solutions from Canadian chartered business banks also often come with significant underwriting challenges. Therefore a large amount of commercial finance in Canada is done by non bank business lending companies in Canada.

BENEFITS OF ASSET BASED LOANS

Asset based lenders for real estate solutions are also available. Different types of asset based financing address various solutions around accounts receivable invoice factoring, inventory, real estate, tax credits, etc. ( Factoring is a form of commercial finance where companies sell their accounts receivable to a factoring company)

For the uninformed asset-based lending / commercial financing is essentially a revolving line of credit that provides you with working capital and cash flow to cover your operating expenses and growth needs. Why is it different then from a typical bank-type operating loan? Simply because there is only one focus, the assets.

MAXIMIZING BORROWING POWER ON VALUE OF YOUR ASSETS

Because the asset based lender is a specialist in commercial finance and the value of your assets, your ability to draw on those assets intensifies greatly - in many cases, you will obtain 50-100% more leverage on your current assets than you ever have before.

Again, why is this so different - it's because the focus is on your personal credit, your company's current or past challenges... it's solely on, you guessed it .. 'the assets'!

In certain cases, even a purchase order financing type facility can be put in place, and more often than not, the asset based lender will accommodate what we term as ' bulges' or unusual temporary needs of your business based on seasonal cash flow, large new orders or contracts, etc.

As a business owner, we think you can see that the total focus now seems to be on your future sales ability and the overall bench strength of your assets. It certainly is not untypical to receive 90% financing on receivables and 50% or often more on your inventory as ongoing advances for your cash flow needs. Note also that selective invoice discounting is also available, allowing you to fund receivables to the extent required.

We also tell clients that unencumbered equipment can be factored into the facility also, so you, in effect, have a fixed asset that provides you with working capital. That’s creative financing!

APPLYING FOR ASSET BASED LOANS

Clients always asked what the approval criteria are as well as any other asset based lender requirements & due diligence needs- the truth is that the criteria that an asset based lender requires are significantly less demanding than those imposed by the bank, the latter focusing on rations, covenants, external collateral, the strength of personal guarantees, and on it goes.

Commercial finance made easy is a great byline for an asset based line of credit. After a standard business financing application and submission of backup data, including aged receivables, inventory listing, equipment list, recent financial statements, etc., you would typically receive an expression of interest. After initial due diligence on your overall asset size and quality, typical security documentation and registration takes a couple of weeks.

CONCLUSION: COMMERCIAL FINANCE ASSET BASED LENDING IN CANADA

Asset based lending finances growth, acquisitions, as well as turnarounds. Let the 7 Park Avenue Financial team ensure you get fast and flexible lending solutions that will help you manage the critical aspects of financing your business. The goal of every business is to thrive and grow!

FAQ: Frequently Asked Questions

Asset-based lending is a business financing agreement that is secured by the collateral of the borrowing company - These asset based loans and lines of credit are usually secured by inventories, accounts receivable, equipment, or other real property owned by the borrower. The asset-based lending industry companies, not individuals

Asset based loans and lines of credit are secured by accounts receivable, inventory, fixed assets /equipment, and/or other balance-sheet assets such as real estate. Companies can borrow a certain amount based on a percentage of the value of business assets which is determined by the lender based on due diligence or an appraisal.

Small, medium and large companies are considered legal entities versus individuals. Commercial finance deals with the funding needs of businesses via debt and cash flow financing.

MORE INFORMATION ON 7 PARK AVENUE FINANCIAL / CANADIAN BUSINESS FINANCING SPECIALISTS

7 Park Avenue Financial originates traditional financing and asset-based financial services provider that offers lease financing, cash flow and working capital financing, and business acquisition loans. The company works closely with clients to develop key business strategies based on their unique needs. The company is committed to providing the highest level of customer service and innovation to help businesses succeed. Combining our experience and solutions, we help our clients achieve profitable cash flow and debt financing and streamline the process with a full range of credit applications.

' 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

Commercial Finance Asset Based Lender | 7 Park Avenue Financial