Small Business Financing & Home Equity Loans in Canada

One of the major advantages of owning a home is the chance to build home equity over time. While you don’t have the ability to sell your home equity, you can use it to get funding for other financial matters such as home improvement, vacation, or college education. In Canada, there are three kinds of home equity loans available for those who want to retire; namely reverse mortgage, second mortgage, and line of credit. An Ontario Home Equity Loan Provider will help you to make the appropriate choice; depending on your circumstance.

Lower Interest Rates

Your home equity acts as collateral to seeking funding from your bank. In Canada, homeowners with equity in their homes could receive large loan amounts. The interest rates on home equity loans could be lower and so this seeking a home equity loan would be the ideal solution rather than seeking an unsecured loan. The home would the collateral in this case and the interest rate would be higher in an unsecured loan transaction. And, not to mention that home equity loans are usually the one option left when the unsecured loan transaction has been declined due to a number of reasons such as low credit score.

The Loan Amount

If you are thinking about getting a loan and you are a homeowner with equity in your Canadian home, then you should direct your questions to a professional agent to find out the requirements before applying. The home equity loan most applied for in Canada and elsewhere is the HELOC, which is a line of credit or a second mortgage. The line of credit is generally the most popular since once you pay it down, the amount left can be reused. In lieu of a foreclosure or sale, you would have both a primary mortgage and a second mortgage to pay off. The amount of money you can borrow on your home for the second position depends on the home equity amount.

Small Business Financing

Now let’s touch on small business financing in Canada. If you want to start up a business or own a small business in Canada, you might need to apply for a loan due to limited cash reserves; especially in the early stages. Access to funding through government associations or financial institutions may be limited; especially with no business credit. Since 1999, the Canadian government is aware of this and has done things to address it by creating the Canada Small Business Financing Program.

How the Program Works

This program facilitates new start-up businesses; helping them through the growing pains of building a business. The program helps small business owners to share the financial risks associated with funding the business by connecting the business owners with the right investment source. The program provides up to a million dollars of funding from various financial institutions with relaxed repayment plans so the business owner can carry out their expansion and growth. The interest rates in this program are quite competitive and affordable for the startup companies; providing them with support for greater ease to repay.

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