WooHoo! I’m Partners With BDC!

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Actually, that’s what the newsletter said ….

I must have sent the BDC another Bank or Mortgage Confirmation, because today I received their Summer 2006 Newsletter (aka Junk Mail) …. It’s nice when bankers think you can bring them more traffic .. Actually – you know what? I hope I can do that .. It’s always good to network with bankers when you are in business.

NEW BDC PUBLICATION:

BDC is pleased to launch it’s new quarterly newsletter designed to give you insight into our specialized business solutions, so that you can offer even more to your clients. Our first issue addresses equipment financing and gives some useful examples that show how your clients can improve productivity, increase sales or preserve working capital.

Did you know that according to the Conference Board of Canada, machinery and equipment investments grew by 9.8% last year and will continue to show strong groth this year?

I should note, perhaps as a disclaimer, that I do have a few clients that have loans to BDC (or, the Business Development Bank), previously known as the FBDB (or, Federal Business Development Bank). I know situations that the BDC has been very helpful in providing a financing solution and even helpful in struggling times of cash flow. I also know situations that the BDC has been quite the opposite, and a detriment towards cash flow and contained stringent conditions and would not work with clients and would rather put them out of business than help them any more.

First of all… have you ever received a term loan from a bank? Generally, the rate is fixed. Sometimes, if it is not fixed, or if it’s a demand or revolving loan, you might receive a bank loan of PRIME plus PERCENT .. for example, you might receive a loan from your bank at PRIME plus 0.5% on a loan that has good security as collateral, or maybe you might receive a loan from your bank at PRIME plus 2.0% on a overdraft loan .. without security.

Now, let’s just suppose PRIME RATE is 5.o% .. then, a loan at P+2.0% would mean to be 7.0% interest rate.

At the BDC, generally (from all the experience that I have had – maybe it’s different now?) – “PRIME” is usually defined as the “THE BANK’S PRIME RATE” .. and “BANK” is usually defined as the “BDC” . “PRIME” of the BDC is usually “Normal Bank of Canada Prime Rate” PLUS 4.0%. So, if you signed a loan with the BDC that says “PRIME PLUS 2.0%” and Prime rate is 5%, what they really mean is that your interest rate is NOT 7% but, instead 11%.

Okay – given the above – this newsletter is still interesting. As I mentioned above …. it’s true! BDC WANT’s YOUR BUSINESS!

Here is a basic summary of the Summer 2006 Newsletter #1

(Q) Are you ready to invest in equipment? Can you replace existing equipment without tapping into your working capital or compromising operations? Do you have access to the financing that you need?

(A) Then give BDC a call.

* Repayment is amortized over the lifespan of the asset , or a maximum 12 years!
* You can pay down the loan up to 15% penalty free!
* You may be able to finance 100% of the cost of new or used equipment!
* You may be able to get an additional 25% of the equipment cost for installation and training!
* You may be able to defer initial principal repayments up to 12 months!
* Seasonal or stepped up payments are possible!
* Choice of fixed or floating interest plan!

For more information, the newsletter suggests that you contact your local branch office of the BDC. However, if you want to contact any of the above individuals on HART (1-800-HART)’s newsletter directly .. please tell them that HARTLEY B SINGER, ACCOUNTANT referred you .. but .. Shhhh! Don’t tell them where, otherwise they will know I’m giving away all their secrets! lol.

BDC – BUSINESS DEVELOPMENT BANK

These people are from
Winnipeg Main Branch
155 Carlton Street
Suite 1100
Winnipeg, Manitoba
R3C 3H8

Monica Allen or Wilson Neapew

Or, you may try this person at the newer location
Winnipeg West Branch
200-1655 Kenaston Boulevard
Winnipeg, Manitoba
R3P 2M4

Len Trotter
Monica Allen

BUT FIRST ….

You might want to do a little research before emailing them ..

* Check out a BDC business plan template
* Read the step by step guide to starting a business
* Are you eligible for financing?

If you think you have what it takes and they might too … you can try with their online financing form

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