Types of Loans

SBL Loans (Canada) renamed CSBFL

These loans are similar to SBA loans in the United States where the Government provides a guarantee. Maximum loan value is $250,000 where the chartered Bank’s approve the loan without consulting a Government agency. These loans are targeted to both existing and start up businesses.

While the program is more flexible on paper we notice the following guidelines.

Uses of funds: To purchase computers, equipment or renovations (cannot finance working capital)

Repayment: Maximum 5 years (3 years for computers)

Personal guarantee signed by the owners: 25% of the loan value

Percentage of assets financed: Up to 90% of the asset value depending on the type of asset being purchased and strength of the business. It is rare for a restaurant to receive financing greater than 50% of the asset value.

Costs: 2% upfront fee to the Government, legal fees, and interest rates cannot exceed prime plus 3%.

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