Lease finance in Canada. Isn’t it perhaps time to become an ‘ Unlearner ‘? That’s the term one American icon once used to reiterate the fact that maybe we need to change the way we’re thinking; and when it comes to what you know or might not know about equipment leasing companies in the Canadian marketplace that just might be some sound advice.

Your firms ability to identify who to deal with and when , depending on your leasing needs will ultimately make it a winning scenario for your asset acquisitions via Canada’s most popular method of equipment finance.

While the ‘ lay of the land ‘ might in fact seem complicated the reality is that you simply need to focus on the fact that its all about getting the right lease structure, ensuring that the rates and payments meet your overall needs based on cash flow and your firms credit quality .

The old term ‘ size counts ‘ is somewhat still appropriate in lease finance in Canada. By that we simply mean that ultimately both the type of asset and size of your transaction will really chart the course for which lessor makes the most sense for your transaction.

We can say in a very straightforward manner that the overall ‘ story ‘ your company presents relative to financial strength, the quality of your balance sheet and your years in business are really the key drivers in any lease approval .

However, that eliminates thousands of firms in Canada who might not necessarily have those pristine balance sheets and income statements we’ve just referred to. Then what?

Well, don’t despair , because the reality is that the term ‘ structuring ‘ comes in play at this point, and those thousands of firms who might think they cant get financed in fact are solid candidates from certain firms in the Canadian lease finance industry . Yes there might be less interest in your deal from certain firms, but many others are eager to step to the table and structure a transaction that’s a win for both parties.

But how do you in fact find equipment leasing companies in Canada – and we mean the right ones, not the wrong ones. Of course larger corporations who are better known can issues tenders and RFP’s, but that doesnt make sense for the SME sector in Canada.

This then is the time to get a short education on the make up of the lease industry in Canada. Essentially it’s broken down into three segments, small, mid and big ticket. We advise clients they can spend a lot of time soliciting lease financing in the wrong market segment. And within that market each lessor has their own views on credit quality and the type of asset they will finance.

Small ticket transactions in Canada, as well as the U.S. typically are under 25k and at this point it’s all about quick credit approval, simple documentation, (often a one page lease) and a rate that commensurate with your credit quality.

Independent finance firms make up the majority of the lease financing market in Canada, but there are many captive finance firms that provide financing for their parent companies products. Banks have again resumed their strong interest in lease financing – rates are low but required deal sizes are much larger ; and when it comes to credit quality with a bank lessor lets just say ‘ you better have it ‘!

An easy way to match your needs with the perfect lessor is to solicit the help of a trusted, credible and experienced Canadian business financing advisor who understands the players, the market, and, most importantly , your needs.