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E-Myth – “Why most small businesses don’t work & what to do about it”

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Virtual Accountant | Are There Different Types of Financing Products Available

Business owners needs to understand that there are several pieces of information there Banks needs says virtual accountant. When they are applying for a business loan they needed to understand that they should not just be asking for a certain amount of money. Because that is not going to help them get everything that they need.

Likely, an entrepreneur is going to ask for a certain amount of money. But will have a lot of different plans for that money says virtual accountant. They might be buying a building, as well as doing leasehold improvements, and buying a vehicle.

Therefore, it’s incredibly important that an entrepreneur specifies not only everything that they are hoping to accomplish with the money that they are getting loaned. But how much each item is going to cost them, and what product they will need for each one.

By being this laser specific in their executive summary. Can help ensure that a bank knows exactly what the entrepreneurs doing with the money, so that they can be more likely to give them exactly what they need.

When was take that entrepreneurs Austin make is simply asking for a specific lump sum of money. And they don’t get the type of financing they need. Because they were not specific enough in their ask.

The executive summary is the most important part of their business plan says virtual accountant. Not only because it is a synopsis of the entire 40-page plan. But because this is often the only part of an entrepreneur’s business plan that Banks read. They will look at that information. In order to influence their decision on whether or not they should loan money to that entrepreneur.

Therefore, business owners need to ensure that their executive summary is Well written. And have very specific Financial requests outlined in it. However, a business owner also needs to ensure that the most important aspects of their business plan is also well written in the executive summary.

The reason for that says a virtual accountant, is so that banks will be able to understand how good is their business plan is. And reassure them that the business owner will be able to be successful in their Endeavors. And be far more likely to succeed and pay back the money.

Business owners should also be so specific that they are asking for the terms of what they want. Virtual accountant says that they might not get the terms but they’re asking for. But if they don’t ask. Then they definitely won’t get what they would Prefer.

Business owners should also keep in mind that while they might want the lowest interest rate, which is typically prime plus 1%. The interest rate is not the most important thing that they should be taking into consideration. They should also be considering the length of the amortization.

This is important, because the longer the amortization, the longer they have to pay it back. And the lower the payments are going to be. Therefore, it’s often worthwhile for an entrepreneur to have a longer amortization with a slightly higher interest rate. Then the lowest interest rate possible. And a short amortization period.

Virtual Accountant | Are There Different Types of Financing Products Available

When business owners are applying for their business financing it says virtual accountant. They needs to learn how to be extremely specific in their request. So that they can end up getting either exactly what they want in the right amounts, and types of financing.

Because if they are not very specific. They might end up getting the wrong type of product, or not enough financing. Therefore, business owners needs to not just ask for the exact amount of money that they want. But everything that they are going to purchase with that money and how much that cost. As well as each of the financial products they are going to need.

There are four different Financial products that business owners can request says virtual accountant. And by specifying these in a business plan. Can help the entrepreneur get to the money that they are requesting from the bank.

If they are going to be purchasing a building for their business. Or if they are going to be purchasing land and then constructing a building. Virtual accountant says they should be applying for financing in the form of a mortgage. They also need to specify the cost of purchasing the building itself. Or the cost of the land specifically and then the cost of construction. Because all three of those things might have very different two terms attached to them.

The next product that business owners should be aware of our term loans says virtual accountant. And these are the loans that business owners will get for any assets that they need. Whether they are pieces of Machinery or equipment for the business. Vehicles that they might need. Or even leasehold improvements for example.

Virtual accountant says business owners not only needed to specify the types of purchases they’re going to make for assets. But exactly what assets they are purchasing, and how much money they need for each one. Each assets also might have a different term on it. Which is why they need to be so specific.

Business owners can also apply for lines of credit. And while these are often the most sought-after by entrepreneurs. Because they are the most beneficial 4 business owners. Banks typically prefer to loan on a hard assets. So they very infrequently give lines of credit.

However, the reason why they are the most sought-after by entrepreneurs. Is because they come with the most Financial Freedom says virtual accountant. Allowing business owners to access any amount of the money that they want at any time. But also because most lines of credit only require a payment of the interest back and not the principal.

And finally, virtual accountant says that business owners should be applying for the credit card that they need at this time. If business owners make the mistake of thinking that they can apply for a credit card from any financial institution later on in their business. They might make a vital mistake.

In fact, once they receive their financing, they are a much higher risk for getting a credit card, and they might not get the credit card that they desperately need to run their business. They’re by applying for everything at the same time. Can make an entrepreneur much more likely to get all the financing they need.