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The Easy Way To Understand Business Finance Interest Rates In Canada
OVERVIEW – Information on business financing solutions in Canada and how interest rates are priced for loans by traditional and alternative lenders
Business Financing interest rates in Canada are often both misunderstood by business owners and financial managers. Is there an easy way to understand how finance solutions are priced? It's certainly not always only about ' fixed' or 'variable ' - that's for sure. We think so. Let's dig in.
Fundamentally it's all about your risk profile but don't forget also there are a variety of both traditional and alternative lenders in Canada- all of whom have different lending guidelines and structures.
Companies who qualify for bank financing in Canada (Spoiler alert - not everyone does!) tend to focus on amortized life of loans and the fixed/variable conundrum. The current low rate environment is a boon for those who qualify for bank financing.
Covenants, ratios and documentation required should always be a part of any commercial borrower’s consideration. Whether it's a bank or a commercial finance company we've certainly observed that the majority of borrowers tend to prefer to deal with a lender with a local presence.
Is size everything? Quite frankly when it come to loans or cash flow finance solutions ' size ' does play an important role in both rate and approval . Interest rate pricing will vary based on credit facility/loan size as well as the amount and type of debt you have on your balance sheet.
It's important to understand that different types of financing in Canada support different goals - that might be one of combinations of growth, working capital, expansion, and even acquisition. In many cases firms opt for a complete refinancing of existing facilities.
What then are different types of business financing that support your firm’s goals? Note also they all have different rates and structures. Solutions for your business include:
A/R Financing
Inventory loans
Sale Leasebacks
Equipment financing
SR&ED Tax credit financing
Commercial mortgages
Non bank asset based lines of credit
Bank credit lines / term loans
Royalty financing
Unsecured Cash flow loans
Your company’s track record and financials will play a key role in obtaining any commercial financing Note also that you firm might have a ' Senior lender ' - typically a bank or commercial finance company, as well as utilizing the financing services of other ' niche ' based lenders, some of whom are profiled above in our list .
While some may view alternative finance solutions as ' expensive' remember also that they will always be cheaper than surrendering equity ownership? Alternative financing solutions can help firms who are challenged or on the verge of distress, which obviously is a key factor in higher rates
It's always about the ' risk ' undertaken by our traditional or alternative lender. If you want to better understand the not so secret truth about business finance interest rates seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success
who can assist you with the best loans and finance solutions that match your firm’s needs.
Stan Prokop - founder of 7 Park Avenue Financial –
Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years - Completed in excess of 100 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 & Contact Details :
http://www.7parkavenuefinancial.com
CONTACT:
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Direct Line = 416 319 5769
Office = 905 829 2653
Email = sprokop@7parkavenuefinancial.com
' Canadian Business Financing with the intelligent use of experience '
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.
Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.
Stan Prokop
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