Bank Financing Loans In Canada . Does A Business Loan Seem Like A 1 Million Step Recovery Program ? It Doesn’t Have To

Is Selecting A Bank For Financing Your Company Harder Than Herding Cats?

OVERVIEW – .Information on bank loan financing in Canada . What are the right steps and strategies to address business loans from Canadian chartered banks


Bank financing in Canada . When it comes to a business loan from a Canadian bank why does it sometimes feel more challenging than ' herding cats '? Some clients feel that the process of getting approved for a bank loan is more difficult than working your way through the 12 Step Recovery program! We've got some clarity and solutions, so let's dig in!

Unlike many, we've got a different angle on bank financing success in Canada. And it’s a pretty simple premise - it’s about your banker, not the bank. Is it just us , but don't all the banks have those great branches, high ceilings, columns at the door to their head office, and that ' church like ' quietness that makes those halls so hallowed.

In the U.S. the borrowing situation is even more compounded for stress - you actually should be checking out your bank there to see if it’s healthy for loan to deposit ratios, etc! We in Canada don't have that problem - but it’s still a challenge nonetheless.

Our Canadian banks do a great job of avoiding risk - they are world renowned in that area. So the job of the Canadian business owner and financial manager is to demonstrate that your business loan or revolving line of credit is not risky. That means being able to demonstrate profitability and the ability to generate cash flow.

It's also critical to prove that you can demonstrate some decent, however rudimentary, financial reporting. The basics are often fine - monthly balance sheet and income statement, aged A/R and a/p, etc. We would submit that if you can't produce those you've got bigger problems already that you don't know about.

We also point out to our clients that in the ' old days ‘a lot of the credit approval for bank business loans resided at the branch. These days it’s with underwriters at head office that we can assure you that you'll never meet. They are probably nice people, but you won't be the judge of that!

So it is therefore important to communicate clearly with your banker as to what's important and what isn’t when it comes to ratios, collateral, historical track record of your company, etc. In the case of banking in Canada more often than not more info is better than less. Sales and growth projections are very solid tools.

Accountants and experienced Canadian business financing advisors are solid resources in negotiating with banks. They have both the relationships and know the lingo!

Any bank financing request should clearly indicate:

Funding required
Term and Nature of financing - i.e. term or operating
Use of funds
Repayment capabilities via cash flow or monetization of current assets

The bank will ALWAYS focus on collateral quality and cash flow. Be prepared to discuss those.

So, should you focus on finding the best bank in Canada for your business? Our own opinion is to seek the best banker. Remember also that numerous non bank financing sources are available to Canadian business. Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with you bank and non bank commercial business loan needs.

P.S. It's probably just us but we suspect the bankers in the TV commercials aren't actually the ones approving our financing request .




Stan Prokop - founder of 7 Park Avenue Financial

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


7 Park Avenue Financial = Canadian Bank Financing and Business Loan Expertise






7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Phone = 905 829 2653
Fax = 905 829 2653
Email = sprokop@7parkavenuefinancial.com

















Stan Prokop