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Our Trade Secrets On Picking The Best Asset Based Loan & Line Of Credit
OVERVIEW – Information on asset based lenders in Canada . What loan financing companies offer this type of working capital financing and why it makes sense for your firm to consider it . What is an asset based line of credit explained
We know thought that you might be a bit confused about this type of loan financing (It's not really a loan) and you want to know which companies in Canada best suit your working capital needs. So we're sharing, dare we say it, some ' trade secrets’! Let's dig in.
Everything seems to be going ' viral ' these days, and we strongly feel that asset based lines of credit from Canadian asset based lenders are right up there - to put it simply, they are ' trending up ' in popularity .
Understanding the basics around this type of solution is the real challenge. How do you pick the right solution and who do you deal with? That's the business challenge facing business owners and financial mgrs.
So, again, what is the service offering really about when you're looking for an asset based lender? It's actually a bit simpler to understand than you think. Clients we talk to are of course 100% familiar with a bank operating line of credit - that's been available forever - if, and it’s a big if, you qualify.
However, did you know that commercial loan financing companies offer asset based lines independent of our Canadian chartered banks.
They do that based on the true value of your receivables, inventory, and in many cases fixed assets or real estate that don't have other liens on them. Simple as that.
So what exactly is the difference then? Aren't we talking about the same thing here? The key differences are simple and that's why hundreds, probably thousands of firms are moving to this type of working capital and cash flow facility.
The reason why this popularity:
Easier approval
Less external collateral - i.e. none!
Less covenants/restrictions/personal guarantees
More liquidity and borrowing power!
Let's cover off those last two points a bit more; they are the ones that most intrigue our clients who are considering the switch. Asset based lenders approve many firms for either more working capital than the client would have received from a bank , or often times approvals are based on facilities that never would be approved by a bank in any circumstances .
Don't believe us? Actually many firms, even those in special loans or coming out of bankruptcy can, in many circumstances, access asset based lenders. Why? Because they have the one thing an ABL (that's the acronym for the industry) needs: ASSETS! The most typical reason for accessing this credit line is: Growth needs!
Here's what you need to know. We speak of a ' loan ' but keep in mind this is basically an operating line of credit for your firm. The factors that affect who you are best to deal with are as follows - the size of your facility, the current financial situation your firm is in, where you are located, and the mix between A/R, inventory, and those other assets you might have on hand.
These types of facilities work best when they are in the 250k and up range. And by the way, up in our case means anything up to 50 Million dollars, or more!
If your firm doesn't qualify from a size perspective there are still some unique business financing strategies for current assets that makes sense. These include;
A/R Financing
Inventory Finance
PO Finance
SR&ED Tax credit financing
Sale leasebacks
Speak to a trusted, credible, and experienced Canadian business financing advisor. You'll be on the road to improved working capital health in a short time!
7 Park Avenue Financial :
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .
7 Park Avenue Financial
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Office = 905 829 2653
Email = sprokop@7parkavenuefinancial.com
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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