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Getting a Small Business Loan From the Canadian Government



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Getting a Small Business Loan From the Canadian Government

By Scott Wilkins

If you have a small business, and you are trying to get a loan, there are a few things you should know. Each bank has a different approach to providing loans; they each have their own risks and challenges. However, here are a few common things that most banks will look for.

You should be prepared to provide:

? Management resume?s (to provide how much experience you have in this field.)

? A project cost worksheet (to show what you are going to use the money for.)

? A business plan that gives a detailed explanation of your business and its strategies

? Personal finance statements for each owner

? Two years of personal tax returns and all schedules for every owner of the business (this is typically defined as a person who owns more than 20% of the business)

? Two or three years of projections showing the business?s expected cash flow (broken down by months)

? Collateral (to show what you have in terms of assets that the bank can take as collateral.)

? A business debt schedule (does the business have any other debt, such as personal notes, or other start up financing?)

Being able to provide what you need is only half the battle when getting a small business loan. You may need some other tips and sources to help you in the process. Here are a few things could be helpful.

If you are wondering where you can get a credit report, these three credit reporting agencies in Canada will be of help, EquiFax Canada, TransUnion, or Northern Credit Bureaus. To receive your free credit report, you will need to fax or mail a request to one of the companies with two pieces of I.D.

It should also be noted that most banks have minimum credit score requirements for all parties guaranteeing debt. This is a 700 or greater credit score for start ups and 650 or greater for established business.

Getting a small business loan can be difficult for a small business. Canadian banks are usually pretty conservative and view start-up ventures as risky. But, banks are not the only place to turn to if your small business needs funding.

Here are a few places you can go for a loan besides the banks:

? Co-vision Start-Up Financing Program- This program is designed to help small businesses in the first 12 months of sales.

? Community Loan Funds- This is a non-profit organization dedicated to helping people who can get the loans they need from traditional lending institutions.

? Canada Small Business Financing Program- this program is made to help new businesses get started and established firms make improvements and expand, this small business loan program provides up to $500,000 of small business financing for any one business.

? Aboriginal Business Canada- This program offers non-repayable contributions (a.k.a. small business grants of up to $99, 999 for eligible individual entrepreneurs. You must be of Aboriginal heritage and have a viable business opportunity to apply).

? Friends and Family- If you believe in your small business and you present a good argument why your business will succeed, you may have a loan available closer than you think.

It?s not impossible to find funding and loans from the Canadian government. It?s important to do your research and know the possibilities out there for your small business.

About the Author: Scott Wilkins is a Canadian business and financial expert. Buy inexpensive business cheques online by visiting Cheque Depot’s website and get free cheques with your initial order.


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