Less Syllables. More Financing. The SBL Loan Works !
OVERVIEW – . Information on the govt loan for small business in Canada . Commonly called ‘ SBL loans’ this financing delivers on financing needs for start up and established companies with revenues less than 5 Million $
SBL loans . It's the govt loan for business in Canada if your firm has under 5 Million dollars in revenue or is a start up. Yes, we said start up! SBL is the acronym for what we lay people call the government small business loan.
So why does this method of financing have the potential to deliver for your firm or start up business. The fact of the matter is the SBL loan has helped close to 8,000 businesses in Canada every year, to the tune of several billion dollars. In many ways it’s the ' go to ‘to purchase and finance machinery, furniture, fixtures, and leasehold improvements. Included in that category are your computer and application software needs also.
We forgive clients who think that for some reason that they will be dealing directly with ' government ‘, which, rightly or wrongly has all sorts of connotations of red tape, delay, forms , etc. Nothing could be farther from the truth. Although the program is regulated and mandated by INDUSTRY CANADA in Ottawa the day to day reality is that the SBL'S are in fact delivered daily in your own community via chartered banks which , shall we say ' run' the program for the government .
So if you in fact thought you would have the pleasure of meeting with government for your loan we're going to have to disappoint you. It's much easier than that. Our own personal gripe with this is that each Canadian chartered bank, in our opinion, has a little different ' spin ' on the program .
But we digress. Luckily we know the right ones! We're the first to admit that you are very mistaken if you are looking for the proverbial ' easy money '. That is not the case. Although the actual deliverables of the loan are very attractive:
5 -7 year terms
Low competitive interest rates - (3 over prime)
No early repayment penalties
Nominal 25% Personal Guarantee
You don't necessarily need to be incorporated - partnerships and proprietorships ok!
Your opening balance sheet must be constructed to meet a proper debt /equity and current ratio
350k borrowing cap
Some relevant business experience
We can categorically call out that this is not ' easy money'. However, are the qualifications stringent or difficult? We don't think so. They are:
- You must be legally allowed to borrow in Canada
- You must have a reasonable personal credit history
- You must have a business premises lease for your company
- You need to have a minimum permanent 10% down payment/equity in the financing desired
- Strongly recommended/required that you have a business plan/cash flow forecast for the business
In your business plan and financial forecast you need to pay attention to the fact that cash flows from the business will be able to retire the loan properly.
It's strongly recommended that your opening line NOT be: We don’t have the money now, but if we do in fact get approved we'll repay you from sales ...'! . AGAIN, not recommended!
As a business owner you have the ability to make the whole process as complicated or easy as you choose. A better idea? Seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can ensure the govt loan for business, the 'SBL ' works for your Canadian business.
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 :
GOVT SBL SMALL BUSINESS LOAN
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
