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

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Virtual Accountant | Learning How to Get the Best Financing Available

Business owners don’t simply need to obtain financing says virtual accountant. They need to get the best of financing available. However, business owners put themselves at risk of not getting the right kind of financing. As well as not to get the right terms. Because they don’t specify their needs and their business plan.

Business owners needs to learn how to be laser specific when asking for financing. And also including that specificity in their executive summary. The executive summary is the most important part of their business plan.

But the executive summary is, is the section at the very front of a business plan. And is one or two pages out of the 40 or so page documents. Often it is the only part of the business plan that a financial institution will look at. Prior to making it there decision on whether to load money to a business or not.

Therefore, more information about the financing that they are asking for that they can include in this executive summary. The greater chance they will have at obtaining exactly what they need.

In order to help an entrepreneur ask for the correct kinds of financing. A business owner first needs to know that they can ask for several different products for several different things at the same time. Many business owners make the mistake of thinking that they simply have to apply for financing every time they would like a loan.

Almost all businesses are going to need credit cards says virtual accountant. So I should ask for one. And if they don’t think they’ll need one, they can get an extremely low limit. But ordering products and services online, will require a credit card. Or some service providers will need to have their credit card on file. So that they can charge the company as needed.

Mortgages are next said virtual accountants, and they are specific to finance land, buildings, or construction of buildings. Lines of credits can be used for a multitude of different reasons. And while they are extremely sought-after. Because they allow an entrepreneur to access as much money as they need whenever they need it. They also don’t require principal payments. allowing entrepreneurs to Simply make interest payments, which is very beneficial for entrepreneurs that are low on money.

The next product available to a business owner is a Term Loan says virtual accountants. And these term loans are typically for assets, but they also could be used for leasehold improvements. Business owners also need to specify exactly what assets they are purchasing. Because a piece of machinery for example, might have different terms than a vehicle would.

By knowing all of the different products that are available to business owners. They will be able to be very specific in their executive summary. Which will go an extremely long way and helping an entrepreneur get the financing they need to be successful in business.

Virtual Accountant | Learning How to Get the Best Financing Available

Business owners should only be applying for loans once as a new entrepreneur says virtual accountants. Therefore, business owners need to figure out all of the financings that they are going to need. And create an executive summary that outlines everything that they need the money for.

The reason why they must do this, is because business owners won’t be able to get the financing they need, whenever they decide they need more money in their business.

Not only is this inefficient. But it is going to leads to them not being likely to get the financing they need. Virtual accountant says that the longer a business has been in operation. The more of a potential to get into a cash Crunch. and because of that, Banks and financial institutions typically won’t give repeated financing to new businesses.

Therefore, an entrepreneur needs to consider after looking through their business plan. All of the various financing that they’re going to need. And applying for them all at once. this is why, they need to be very specific about the total amount of financing they need, and then give exact details about what product, and how much for each.

But business owners also need to keep in mind other important aspects of loans says virtual accountant. Such as what terms they need to be looking for. business owners often think that the lowest interest rate is going to be what dictates whether they accept a loan or not. And while low-interest rates are important. It is not the only thing that they need to be looking at.

Business owners also should consider the amortization of the loan. Because the last time an entrepreneur has to pay that loan back. The more of a financial strain it’s going to put on their business. Because of that says virtual accountant, business owners should be looking for the longest possible amortization that they can have.

A business owner should also be willing to sacrifice a little bit of there interest rate. In order to get a better amortization. An interest rate that’s 1% higher than the best offer they have. Is worthwhile if it’s going to make the difference between a five-year amortization and a 20-year amortization.

When business owners understand that products, as well as interest rates and amortization, should be considered. It makes them a lot more prepared to look at all of the different financing offers they have. From all of the various financial institutions that they have approached.

This means that business owners need to approach many financial institutions at one time. Virtual accountant says if business owners apply at One bank, and wait until they get know before applying at another financial institution. They can waste valuable time.

Therefore, by applying at several financial institutions. Business owners can look at all of the options that they are being offered. So that they can make the best judgment call of which financing offer is going to be the most beneficial for them. Or if they need to go back to their business plan. Andrea just some things to make the best offer work.