Situation

Business funding with corporations: how it is read and what helps.

Incorporated businesses have a clear legal entity and usually cleaner paperwork.

✓ Checking what you qualify for does not affect your credit score.

How this is read

Incorporated businesses have a clear legal entity and usually cleaner paperwork.

A corporation separates the business from its owners legally, and funders review the account in the company's name. Ownership details and signing authority are confirmed in the application.

What helps

Articles of incorporation and ownership information
A company bank account
Consistent corporate and trade names
Up-to-date registrations

What hurts

A trade name that differs from the account name
Unclear ownership
Dormant or unrelated accounts

A sensible plan

Have the corporate name, ownership split and signing officer ready. Match the legal name on the application to the bank account.

Illustrative arithmetic

A manufacturing company depositing about $140,000 a month asks for $60,000 for equipment. At a 1.2 factor the payback is $72,000, a cost of $12,000. Over roughly 6 months that is about $571 per business day, or close to 9% of monthly deposits.

Total payback: $72,000.
Cost: $12,000.
Payment: about $571 per business day, close to 9% of monthly deposits.

Every figure on this page is illustrative arithmetic in Canadian dollars. It is not an offer, a quote or a promise of approval.

Typical starting points

Monthly revenueTypically from around $20,000 a month in deposits for Canadian files. The exact line varies by funder and by file.

Time in businessTypically about 12 months. Newer businesses can be reviewed, but the options narrow.

Account healthLimited low-balance or negative days. Funders read the last few months of bank statements for this.

CreditScores from 500 are considered. A score of 600 or higher opens more options and better offers.

DocumentsA signed application and recent business bank statements, typically the last four months.

Existing advancesFiles with an existing advance can be reviewed, including second position.

Common questions

Is a corporation easier to fund?

Not necessarily. The deposits and account health are what matter.

Who signs?

An authorized officer, as shown in the corporate records.

Is a personal guarantee required?

Terms vary by funder and file. Ask what the agreement requires.

Keep reading

Underwriting situationsCredit, NSFs, time in business and more Funding requirementsTypical starting points for Canadian files Documents you needWhat to have ready before you apply Bad credit business fundingHow files with weaker credit are read GlossaryPlain-language definitions

Educational information only. It is not legal, tax or accounting advice.

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