What collateral do you need for a business loan in Canada?
Collateral isn't the whole story, but ignoring it makes a plan read as naive. Here's what lenders look at and how to present it.
Collateral is the lender's fallback: what they can recover if the loan goes bad. The stronger your security, the more comfortable they are — and sometimes the better your terms.
Common forms
- Business assets — equipment, inventory, receivables
- Real estate, including home equity in some cases
- A personal guarantee (very common for small business)
The personal guarantee reality
For most small-business loans, expect to sign one. It means you're personally on the hook. You don't have to love it, but you should understand it going in — and factor it into how much you borrow.
How to present it
List what's available honestly and specifically. A plan that addresses security directly signals an owner who understands how lending actually works.
See where your plan stands
Paste the plan you have into the free Scanner. It scores you against the eight criteria Canadian lenders use — in about thirty seconds, no account, nothing leaves your device.
Score my plan — freeLenderReady is an educational service, not a lender, broker, or financial advisor. Lending criteria vary by institution and change over time; treat this as a starting point, not a guarantee.