How To Apply For A Business Loan

In order for a business to keep operating, or get it off the ground, it must have financing which can often be in the form of a business loan. It is not difficult to apply for commercial loans from banks and other financial institutions. Business owners looking for start-up loans can apply for business loans in Toronto from lending institutions. If you are looking to apply for a business loan, whether to fund an ongoing business or inject capital for a start-up business, there are certain steps you need to follow through the loan application. This is what you have to do:

Reason and amount of the business loan

Most ongoing businesses have a clear reason for and the amount of the business loan they need. However, this is not the case for a start-up business. Start-up business owners may only be in the process of determining how much money they need and for what. Before applying for a loan, any business looking for funding, whether a start-up or existing, should take some time and be able to articulate how much they need and why they need a business loan. It is hard to know how much you need for a business loan unless you prepare your financial statements. This should be done as part of your business plan.

Review your credit score and credit history

If you are looking for a start-up loan or your business is less than 4 years old, the lending institutions will evaluate your personal credit as well as your business credit history. You need to take some time to review your personal credit history first or that of your business. You can easily get credit reports from major credit reporting agencies. If you find any errors in your credit report, you need to write back to the agency and ask for a detailed report on the errors and how to fix them.

There are some errors that the agency cannot fix and if you find yourself in such a position, you need to file a credit dispute report. Make sure you also check on your credit score. A good credit score significantly increases your chances of being approved for a loan. However, if you do not have a good credit score, you can still apply for a business loan. You need to find a lender who is willing to offer a business loan despite your bad credit score.

Start reviewing your borrowing options

It is advisable to look at all the reputable lending institutions in your area. Do not just go to large commercial banks; consider even the private lending institutions. Visit every one of these lending institutions and talk to them about your loan application and see what each institution has to say. This will help you pick out a lending institution that is flexible to your terms.

Prepare your business plan

Before you get a business loan, you are required to prepare a good business plan. Unless you have a good business plan, you may not know exactly how much funding you need or how fast you can repay the loan. All institutions ask for a business plan as one of the loan application requirements. To prepare a good business plan, you need to include several years of past and present financial statement for your business.

Start-up business owners have to present their personal financial statement dating back to several years. The statement will include the type and value of assets you have to use as collateral to secure the loan. You are also required to provide a statement of your experience as well as an analysis of the market your business will serve.

Plan a presentation and make the appointment

In order for a loan officer to approve your loan application, you have to ensure it is compelling. Prepare an application and a presentation of your business plan for your loan officer. Make sure that you hand over a professional package that includes spreadsheets, financial statements and charts if necessary.

Include an executive summary. the executive summary is very important since that is what loan officers go through first before they can decide whether they are interested in your project or not. Make an appointment with your loan officer and request for enough time to allow you to make a short presentation. You can use visual aids depending on your business plan. Ensure that you are well prepared and be organized, succinct and concise.

If this is your first time to apply for a loan, it’s wise to look for a company that can help you acquire business funding in Toronto. Before applying for business loans in Canada, there is a lot of research that has to be carried out first and this can be overwhelming for a start-up business owner. Look for a company that has already done the research and knows all about the business loan market as well as the start-up funding market. They will help you to find the most appropriate source of funds quickly for your business.

Business Lawyer: Yes, You Do Need to Hire One Immediately

You may have been constantly told recently to talk to a business lawyer for one reason or the other. While this may seem like an unnecessary investment of time, effort, and money bear in mind that proper, timely assistance from an experienced and specialized professional help can help you from making a drastic mistake with your business.

Don’t wait for matters to build up and wait for the last minute, make sure you contact a professional in the beginning and get the correct advice.

Why should you consult a business lawyer?

  1. Firstly, if you are planning to set up your own commercial business, you may have never thought about employing the services of an attorney from the beginning. But, it is also a great idea to contact an established, experienced legal professional to address any issues that could arise from establishing a practice. You may be surprised at the different valuable advice you may gain from this interaction. Additionally, all the hard work will be done for you previously.
  2. Either way, starting a company will automatically put you in a place to deal with legal implications and different complications as well. An attorney will be able to help with these different problems in an efficient manner. Additionally, he will be able to avoid technical problems that may arise from different commitments later on.
  3. Things such as drafting contracts and agreements, filing for patents, getting trademarks registered, and protecting trade secrets are some of the most important things while setting up any new organization require some specialized legal knowledge. It is therefore important for you to employ the services of legal attorneys who can help you carry out things in the proper manner.
  4. As an employer, it is your duty to make sure the rights of your employees are protected and their welfare is taken care of in every aspect within the corporate setup for as long as they’re in your service. A legal advocate will be able to give you all the necessary information that you need to figure out to draw out the necessary papers and agreements.
  5. Lastly, some situations very obviously need legal assistance. For example, if there’s a lawsuit filed against your company if there are allegations of fraud and malpractice, your company may be in serious danger. In these cases, an efficient and professional lawyer will be able to help you or soften the bad implications for your company. This can help you essentially lessen the blow of your final sentence.

The law gives you full permission to defend your legal rights and you should make sure to utilise this fully. It is best not to take things into your own hands because you won’t know the technical or legal details and you may mess things up really badly. In this case, you will have to pay way more in legal fees than you would have originally done. If you look back on previous occasions, you will realise that in some cases, it is best to bring in professionals. If you need a business lawyer, do your research and employ the services of one and you definitely will not regret it.

Free incorporation and advise. We know that a startup is not easy. We, at Shorewest Capital Corp. want to help.

group of young entrepreneursRegistering your new business as a corporation is one of the important things to do at a startup. There a number of good reasons why this is so.

Your personal assets will be safe from customers’ and suppliers’ claims as you and the corporation will be two separate legal entities.

It will be easier to raise funds as banks and other potential sources of funds prefer to deal with corporations as opposed to sole proprietorships or partnerships.

It will be easier to take advantage of a number of tax planning strategies.

We will prepare all forms needed for the incorporation and file it with the Government at no cost to you. You will pay only for the Name Searching fee and the Government Incorporation Fee.

We will also help you obtain all federal and provincial business numbers at no cost to you.

Sounds like a good deal?

We want to help. Call us at 416-702-2721 or e-mail us

how Shore West Capital can help aspiring entrepreneurs obtain financing for their start up business.

group of young entrepreneurs

group of young entrepreneursStarting a business of your own can be a challenging experience, but the rewards can be great.  If you are in the process of starting your own business the Shore West Capital team can help make the journey a lot more comfortable.  With many years of experience working with new businesses and helping them find their feet, you can trust Shore West Capital to get your business of the ground.

The Shore West Capital team will guide you through all of the necessary steps required to ensure that your business is set up for success and legally compliant.  We will help you start from the very beginning by creating the right corporate structure so that you can look to the future with confidence.  Next we will look towards developing a business plan that will not only meet with your needs and aspirations, but also be very attractive to investors.

Shore West Capital prides itself on being able to help new businesses find the funding that they need to get started.  We are able to pave the way for you to find everything from commercial loans to government grants and loans.  We also have other options to help you find the money your business needs such as private lenders and investors.

To address the legal needs of your business we will be able to provide you with the information you need on the very best business and corporate lawyers available.  We will assist you in managing the financial end of your business all the way through to making sure that your corporate and personal taxes are taken care of by our team of experts.

How do I choose the right source for my start-up capital?

When you have a choice of investors you know that you are on the right track.  There are a great many sources of start-up capital today, however there is more to making the right choice then you think as not every lender, or investor is created equal.  Shore West Capital will help you navigate through this wide array of funding sources to make sure that you choose the right one for your business.

The requirements for each of the potential sources of funds that you are looking at will vary quite wildly.  Some of them will have strict stipulations about who and what they can fund and these conditions may be imposed on an ongoing basis so you need to choose wisely.

In addition to private lenders and investors, Shore West Capital will also be able to propose any Federal and Provincial programs that may be suitable for your business.  These can be a great help to your start up business provided that you meet the necessary requirements.  Once again, Shore West Capital will help you to determine the right source of funds that are appropriate for your business and personal goals.

The Shore West Capital team is committed to making sure that your search for funding is as stress free as possible.  We are able to get a short list of the most appropriate sources of funding that are most likely to fund your business. We are experts at what we do and you can be sure that Shore West Capital will be able to get you the funding options that you need.

The first step, your business plan

A business plan is a very useful document that will help you as the owner to reach your goals as you start your business. It can also be very important when you are in the process of sourcing funds or start-up capital.  At Shore West Capital, we will use the information that you provide about your business and help to write a business plan that will satisfy the needs of potential lenders and investors.  Not only will we make sure that the plan is sound, we will also aid in the presentation of this plan to potential sources of funding.  This is a vital step in the process of looking for funding for your business.  The best business plans are detailed without being unnecessarily long and contain all of the pertinent information about your company’s structure, the expertise of the manager, projections and timelines.  All of the information will be backed up with research and supporting evidence.

The early stages of looking for funding for your business can be a daunting and stressful time.  There is a lot of misinformation out there and you need to be sure that the funding you have is the right choice for you in the short and long term.  By taking advantage of the years of experience that the Shore West Capital team has, you can be sure that you will be set up with the right start-up capital from day one.  You will also receive ongoing help with a great many other facets of your business.

Understanding Business Plans – your First Test as an Entrepreneur

Many crucial reports, surveys and experts have discovered various major difficulties which entrepreneurs face across the world. One of the major reports named Global Entrepreneurial Monitor’s (GEM) report 2013-2014 has attempted to cover each region in the world encompassing 70 economies be they developing or developed.

One of the key finding of this report was that, vast majority of nascent entrepreneurs also known as early stage entrepreneurs fail in their business. What these nascent entrepreneurs don’t understand is that- starting and keeping a business starts with a plan. Before you decide to invest your money or borrow money for the business, you have to stop everything, and start to think about the plan. If you can’t think about an appropriate plan, you can take help from an experienced businessman or even initiate to talk to a business consultant. Make sure that you take advise from a small business consultant, if you hire a large business consultant they will sell you huge unrealistic ideas which will lead you to no-where.

Every business owner should know the importance of planning. The way your business is planned from the outset must be the right way. A poor plan will do nothing but waste your money and time. A poor plan often results in insolvency.

The right way a business plan is put together has number of significant aspects. These significant aspects are-

  1. Business concept or an idea

It is true that an idea can change your life. A good idea leads to a successful business, whereas a bad idea can lead to insolvency. A start up should be able to write down on a paper what he wants to do. In short, no concept no business. An entrepreneur should be able to formulate a new innovative idea that draws people attention to it. He should do his homework and search every possible thing about the concept that he has come up with. After all the work is done, he should test the views of his family, friends and close relatives. Take their feedback and work upon it.

  1. Describe the business strategy of your business

Next step is formulating an intelligent business strategy. A good business strategy will clearly demarcate the future, purpose and ultimate goal of business. It will be the ultimate force that will drive everything you are doing or will do in the business.

  1. Describe your legal status as a company

The legal status of the company is important as it will determine your standing in the courts in terms of the appropriate acts that you are bound to comply with taxation authorities, banks, financial institutions and other stakeholders. Most important thing that you need to keep in mind is that you have to lead your business lawfully. Hence you have no other option but to follow the rules and procedure of the superior authority. You are subjected to legal environment irrespective of whether you have a small business or large business. With the passage of time if you become bigger and are making money as a listed company you will be taking care of corporate governance, risk and compliance structures and policies.

  1. Describe the development cycle your business finds itself in.

Many new entrepreneurs want to run their business at the time when they can’t even crawl. You have to play smart and keep in mind that every business revolves around a business cycle very similar to us life of human beings. From the very beginning you have to do your work on the potential challenges you will be facing later in the operation of the business.

  1. Describe the history and problems of your company

Age of your business and its history is closely related to your company’s business cycle.

A smart entrepreneur knows the strengths, weaknesses, opportunities and risks of its business. If some of the problems are foreseeable, then he should take every measure in his capacity to prevent that problem so as to ensure smooth working of the business.

  1. Detailed description of material things.

Material things include many things, the description of which is indispensible for any business. These material things include-

  1. Products/services- what the business will be offering.
  2. Market- where the products/services will be offered and who will be offering.
  3. Customer or clients- fulfilling the customers need.
  4. Marketing and sales plan- promotional activities, price, distribution etc.
  5. Competition- who is the competition, where is it located, etc.
  6. Staff and management team-qualification and experience of the people in your business.

 

  1. Draft a financial plan around the pieces of puzzle.

Lastly, you have to draft a financial plan comprising of balance sheet, income and expenditure sheet and cash flow sheet. Financial plan are very part of the business plan. It will involve a lot of time to draft your first business plan. So you have to be prepared for hard work. Your business plans will keep changing with the dynamic business environment.

Ways To Create A Brighter Financial Future For Your Business

The first few months of the year is usually a great time to get your business pointed in the right direction. If there are things that you failed to achieve in the past year, it is the perfect time to put effective strategies in place to ensure business access. That is why it is advisable to make changes to your business at the beginning of the year. While the year is still young, you can take a number of steps to help your business do well financially. There is absolutely no need to play catch-up later on. These ideas will make you see things differently.

Previous year review

First, you should take some time to preview the previous year and determine what worked and what failed to work. The most expensive lesson in life is the one that you learn the second time. So you do not want to repeat mistakes. You need to review the previous year’s performance.

There are a number of things that essentially topped the list as the most important lessons learnt over the period. As funny as it may sound, these things helped you move forward. Therefore, do a review and ensure that mistakes are not repeated. Focus on key areas that promise the best returns for your business.

Rightful use of stats

Stats are of no use if you do not how to properly use them. The wrong stats do not help at all either. That said, you cannot simply control what you do not track.  You should determine the three most fundamental statistics for your business and set goals around each of them. By following each of the stats every month, you will be able to make small effective adjustments throughout the period. If you carefully pay attention to your stats and take the appropriate actions, you will be totally amazed by the results.

Effective cash flow plan

Now you do not have to be good in everything. In an organization, everyone has their roles and responsibilities. In light of that, you can do your company a favor by working with experts for financial planning for business in Toronto who can offer great financial advice.

Your business needs an effective cash flow plan, which can easily be determined by the experts upon carrying out an evaluation. Too often, most business owners fail to see the value of having a strong budget plan. They presume that they can keep track of all the business expenses without a budget. A cash flow is actually critical for the success of your business. Market conditions vary over time and you need a plan for the slowest times of the year. Contingency funds come in handy here.

Shop for the best price

You do not have to afraid of shopping for the best prices. Anything that helps your business run goes at a price. Therefore, you need to find the best price for office supplies, insurance, telecommunications among other business expenses. A current supplier has no incentive to offer you any discount. However, a competitor has a bigger incentive by giving you a great deal. Therefore, you should take time to shop around for the best prices.

Understand your competitors

Are you aware of your competition? It is important to know your competition. You should know the companies that are doing better than you and what keeps them at the top. Learning from their successes and mistakes can help you grow your business significantly and improve its financial standing.

All in all, you need business consultants and financial advisers to make the right choice for your business. As you work on these areas, always remember to hire experts when it comes to financial analysis and planning as well as business expansion.

Business Matters – Tax and Financing Implications Of Selling A Business

When working on a small business sale, it is paramount to brush up on a number of facts that are key in effective decision-making.  You need a clear understanding on the implications of taxes on proceeds realized after a sale. You also need to know how sales are financed.

Every choice you make as an entrepreneur affects the manner in which money is transferred from a buyer to a seller and the tax implications thereof. If anything, you are not being asked to be a tax guru or a financial analyst. That is where business consulting services come in handy. Here is more on what you need to know about the process of selling a business.

Approaches to purchase-payment

There are various approaches of payment. Each of these payment approaches only favors one party. This means that the seller or the buyer benefits depending on the outcome of negotiations. You are about to have a look at various approaches of financing and paying off purchases for small businesses.

The cash payoff at closing

This is quite rare. All cash offered at closing gets rid of the concern regarding a buyer’s ability to effectively make after payments.  Although it is a good option, it is likely to drag you all the way into a higher tax bracket. This is because all proceeds are received as revenue in a single year. According to research, this payment system results in very low selling prices after you have included your tax. Moreover, it limits a buyer’s pool to only those with great cash resource.

Third-party financing option

There is absolutely no doubt that bank loans happen to be the hardest thing to come by when you need fast cash. Even if you are lucky enough to get some cash, the entire process of acquiring the loan is usually time-consuming. In light of that, you should request for a prequalification letter from a particular lender to receive funding the minute a buyer indicates the need for third-party financing during prescreening.

Home equity loan

 

For homeowners buying a small business, purchases can be self-financed by simply tapping into their residential equity through second mortgaging. If a buyer is going to settle the payment through home equity loan, at no point should you accept his home as the loan security.  This is because you will be in a subordinated position when you want to call on the asset.

Tax implications

By seeking professional advice from a business consultant in Toronto, you will be able to make the right choices on payment approach as well as allocation of price. You will also get an in-depth understanding on tax deferrals and how things work to your advantage. This typically involves accepting part of the ultimate purchase price as installments over a number of years and allocating the deferred payments to various assets that will be taxed based on capital gain rates. You also need to factor IRS-defined assets that are categorized in classes. This is necessary for effective purchase price allocation. More often than not, it involves the full participation of both parties. Both the buyer and seller have to report identical price allocation, which should be in line with IRS specifications. Some of these allocations actually benefit you and the buyer in a number of ways.

When planning to sell your small business, you should always consult with business experts who deal in business acquisitions, financing and overall business management. They will help you get a clear picture of everything. The choices that you will make will be well-informed. This is will ensure that at the end of the day, you get to rip maximum benefit from the sale of your small business.