Exclusive Interview
Sarmen Abkar
Consultant & CEO Atlass Consulting LTD. Atlass Consulting is a Canada based mortgage consulting agency and brokerage firm that deals in financing, residential mortgages, commercial mortgages and bank loans. MBE: Please tell us a bit about your background in commercial financing, business line of credit and equipment finance? Sarmen: My background is more on business loans, business line of credit and equipment finance. I have been doing Commercial Financing since 1998. I started in the jewelry manufacturing business, when business went down a Jewish guy came to me and said why don’t you go to Seneca college and get a consulting and mortgage license. I did that and got those licenses. For 2 years I worked on residential then I moved on to financial consultation for start-up businesses, business line of credits and equipment finance. MBE: What is one common mistake that people make when applying for a business loan? Sarmen: Most people in my experience when you go to the bank today, when you ask for a business loan or business line of credit or equipment finance the bank asks you if you own a house. And they say we can give you a loan against your house. That’s the worst thing to do. You should never put your personal things as collateral against a business loan. When you have a business, borrow against the business. Two years ago in New York I partnered with a bank that finances business people with poor credit with high interest rates, I did a few deals with them. Last year I partnered with Lending Loop, a Canadian Company that finances businesses even if they have poor credit, although with high interest rates. I always advise my clients not to get business loans against your house or other personal property MBE: How much liability is there on commercial financing of 1%? Sarmen: If you get a business line of credit you’re responsible for 100%. But when you get a government loan you are responsible for only 25% personally. If you get a $100,000 government business loan and things go bad you have to pay $25,000 and you’re clean. MBE: What about RBC or BDC? Sarmen: BDC does not have that facility. Only chartered banks have that facility because government is the co-signer for 25%. MBE: What is your suggestion for new and aspiring small business owners to avoid bankruptcy and financial trouble? Sarmen: The problem with most clients is that they mix their business with their personal assets and liabilities. Their personal visa is paid for from the business, their mortgage is paid from the business account. So they are mixing their business and personal accounts. A lot of businesses close down due to this. If I’m working for my company, my company should be separate from my personal finances. I ask my clients to sit down and calculate how much money they need a month to live and maybe the answer is $4000, so you have to tell your accountant to write a check as income from the company for that amount every month. Normally everything is being paid for from the business account and they don’t
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MBE BUSINESS MAGAZINE FEBRUARY / MARCH 2020
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