Wanted ! Canadian Companies Looking For The Government Loan For Small Business – ‘ SBL Loans ‘

Updated: May 23, 2011

Do you equate business loans and the word ' success ‘in the same sentence when you think of your chances of business financing success? Most clients we meet don't! They recount countless challenges in meeting their financing needs from what we term as traditional financing sources.

So, time to give up. Never, we say. One of the most viable options you can explore are SBL business loans for your company. They are offered (perhaps the better word is sponsored) by the federal government and the rates, terms and structures of this small business loan beats anything out there, and we'll show you why.

A word of caution though - you need to invest a little bit of time in understanding two key elements of the program - first , what it offers, and secondly, how you get to the goal line .. Quickly! (Many clients we meet are frustrated by their timelines in achieving this financing - you don't have to be in their shoes if you follow our advice)

So, what is the program and what does it finance? That seems like a good start. The SBL government loan - small business is sponsored by the federal Industry Canada department. The program has been in place for many years, and last year almost hit 1 Billion dollars in financing for your competitors. (We want to put you on that same boat!) . The programs official name is the BIL program, and it is a term loan, typically five or seven years in duration, at rates of 3% over prime.

While many larger corporations are required to provide full personal guarantees of owners for their business financings the SBL loan does not, requiring only that the business owner guarantee only 25% of the loan amount - how about that!.

Misunderstanding. That's what we run into a lot when we explain to clients what the loan can be used for. Unfortunately it is not a cash flow, but a loan that can be used for 3 separate categories of assets, equpment, leaseholds, and real estate also. Our own experience is that it is rarely used for real estate, but it's nice to know that that facility is available to your firm.

Timelines. Time is money - who hasn't heard that one? You can easily facilitate your SBL utilizing the motto of the Boy Scouts of Canada - ' BE PREPARED!'

When you are ready to commit to the loan ensure you have a crisp business plan ready, one that addresses the needs of your business and has a financial model in place showing repayment of the loan. Your own respectable personal credit rating is key also, and the loan typically requires a credit bureau score of 650 to gain approval .

While we speak in terms of a government loan the reality is that the feds charge our chartered banks with the actual administration of the loan - so in actuality the loan is available on almost ever street corner in Canada - where there is a chartered bank branch of course !

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