Childrens Miraclefund

An asset finance strategy can sometimes be the best solution for your overall business financing needs. Clients we speak to have trouble differentiating this type of solution from a regular Canadian chartered bank line of credit. The difference is simply the overall focus of the financing an asset based line of credit focuses solely on the variety of different business assets you have  they include predominantly inventory, receivables, equipment, and in some cases real estate. When you successfully set up an asset based loan facility you are in effect monetizing these assets to their maximum, and borrowing against them as you need funds, on a daily basis. Naturally the main and most liquid assets in this type of financing tend to be receivables and inventory, but those other hard assets can nicely shore up an even higher credit facility for your firm. Another way of looking at this or explaining it more clearly is the manner in which these loans are set up and approved.. If you have now, or in the past secured a bank facility on the other hand you of course recognize the banks puts a lot of emphasis on non asset issues such as overall financial statement quality, external collateral, personal guarantees, etc. That is the main difference between these two types of financing. If you can demonstrate positive cash flow and cash flow from operations to a Canadian chartered bank it is unlikely you can obtain a business line of credit that suits your overall needs.

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