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BMO small business loan review

Grow your business and supplement your cash flow with a small business loan from BMO. 

There are several BMO small business loan that you can apply for based on your financing needs. These include small business installment loans and Canada Small Business Financing Loans.

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  • Think about BMO if you want to be backed by a Big Five Canadian bank and you would like to borrow up to $500,000.
  • Pick something else if you have a poor credit score or you’d prefer to prepay your loan without penalty.

Expert review

BMO (also known as the Bank of Montreal) is a reputable multinational bank based in Canada. It has over 900 branches across the country and provides banking services to millions of loyal customers.

The major benefit of BMO is that it offers several small business loan options and lets you borrow up to $500,000 at a time. The downside is that you have to apply for a business loan in-person at a branch location and there are no interest rates listed online.

First, do I qualify?

You may be able to qualify for a BMO small business loan if you can prove that you meet certain eligibility criteria. These criteria aren’t listed on the company website, but likely include being able to demonstrate that your business makes enough money to pay your loan back on time.

You’ll also typically have to prove that you have a high credit score and your business has been operational for a significant amount of time. There could also be other requirements that you may have to fulfill depending on how much you borrow and how you want to use your funds.

How does a BMO business loan work?

There are several BMO small business loan that you can apply for based on your financing needs. These include small business installment loans and Canada Small Business Financing Loans.

BMO Small Business Installment Loan

BMO offers Small Business Installment Loans that let you borrow up to $250,000 with a simple application. These loans come with fixed or floating interest rates and you can sign up for variable term lengths that can last up to 15 years.

If you want to qualify for more money, you may be able to apply for up to $500,000 with an Installment Loan Plan (ILP). This will let you borrow money on a longer term, with a range of flexible repayment and amortization options.

You may also be able to apply for a US currency loan if you’re looking to borrow less than $100,000. This will let you take out funds in US dollars and avoid paying a high exchange rate when you spend money across the border (though you may have to pay the exchange when you repay your loan unless you have a source of US revenue).

Canada Small Business Financing Program (CSBFP) Loan

BMO‘s Canada Small Business Financing Loan lets you borrow money that’s backed by the Canadian government. You may be able to qualify for up to $1,000,000 to finance business real estate or up to $350,000 for leasehold improvements and equipment.

This loan has a 2% registration fee, plus the lender may charge any fees that they would typically charge for a conventional loan of the same amount. You’ll have to personally guarantee up to 25% of the amount you borrow. You’ll also only be eligible to apply if your business makes less than $10 million per year.

What makes BMO small business loans unique?

BMO business loans are unique because they’re financed by a Big Five Canadian bank. This means that you can expect a high level of customer service and stringent policies to govern how your loan is managed.

BMO also offers several different types of small business loans to fit every set of business needs. These include US dollar loans up to $100,000, government-backed loans up to $1 million and small business installment loans worth up to $500,000.

What other types of business financing can I get with BMO?

If an installment loan doesn’t make sense for you, you might like to check out other financing options that might be available to you. These include the following:

  • Line of credit. Access revolving funds and only pay interest on the money you use with a BMO line of credit.
  • Commercial loan insurance. Qualify for up to $1 million in benefits to protect your business and cash flow during emergencies.

What are the benefits of a BMO small business loan?

Flexible loan options. You can apply for a small business loan sponsored by the bank or the Canadian government, depending on what you need to borrow money for.

  • Large amounts. You’ll be able to apply for up to $250,000 and $1 million, based on what type of loan you’re interested in.
  • Fixed or variable interest rates. You’ll have the option to choose whether you want a fixed or floating rate, depending on your budget.
  • Long terms. You could have the option to pay your loan back over a long term (up to 15 years‘ amortization).
  • Other financing options. You may be able to qualify for other forms of financing such as a line of credit or commercial loan insurance if you’re not sure about a business loan.

What to watch out for

  • No online application. It’s not possible to fill out an application online, so you’ll need to visit a branch to set up your loan.
  • Interest rates aren’t listed online. There are no interest rates listed online which makes it difficult to compare quotes from several providers.
  • May need to secure your loan. You may need to put up collateral like your home, vehicle or business assets to secure your loan.
  • Bad credit not accepted. You likely won’t be accepted if you have bad credit unless you can secure your loan or bring down the risk of lending to you in another way.
  • Poor customer reviews. There are several negative reviews that customers have left about BMO‘s services online, though these aren’t specific to its business products.

Compare with other business loans

Name Product Interest Rate Loan Amount Loan Term Minimum Revenue Minimum Time in Business Loans Offered
SharpShooter Funding Business Loan
Prime pricing from 9.00%
$500 - $250,000
6 - 60 months
$10,000 /month
100 days
Unsecured Term, Merchant Cash Advance, Invoice Factoring
To be eligible, you must have been in business for at least 100 days with a minimum of $10,000 in monthly deposits.

SharpShooter provides capital to small businesses that are underserved by banks and credit unions. It measures overall business health and potential rather than focusing strictly on traditional metrics. Fill out a simple application and get pre-approved in minutes. Receive your funds within 24 hours.
Lending Loop Business Loan
Starting at 4.96%
$10,000 - $500,000
3 - 60 months
$8,500 /month
12 months
P2P
To be eligible, you must have been in business for at least 12 months and have a minimum of $100,000 in annual revenue.

Lending Loop is Canada’s first regulated peer-to-peer lending platform. Complete an application in 5 minutes. Once you accept your loan offer, investors will begin to fund your loan on the marketplace. Your loan will be transferred to your bank account when it is fully funded.
OnDeck Business Loan
8.00% – 29.00%
$5,000 - $300,000
6 - 18 months
$10,000 /month
6 months
Secured Term, Line of Credit, Merchant Cash Advance
To be eligible, you must have been in business for at least 6 months with a minimum monthly revenue of $10,000.

OnDeck offers fast and simple financing. Apply in less than 10 minutes with your basic business information and see your loan offers without hurting your credit score. Get approved within 1 business day, and choose your term, amount and payback schedule once approved.
Loans Canada Business Loan
Prime Pricing from 9.00%
$2,000 - $350,000
3 - 60 months
$4,166 /month
100 days
Unsecured Term
To be eligible, you must have been in business for at least 100 days, have a credit score of 410+ and show a minimum of $4,166 in monthly deposits ($50,000/year).

Loans Canada connects Canadian small business owners to lenders offering financing up to $350,000. Complete one simple online application and get matched with your loan options.
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How much will my loan cost me?

Your loan will cost you different amounts based on what type of loan you take out. Your interest rates will also be influenced by personal factors such as your credit score, whether you have assets to secure your loan and how long you need to pay your loan back.

That said, there’s very little information about what BMO charges for its interest rates online. Your best bet for finding out how much you’ll have to pay will be to book an appointment at the bank to speak to an agent about your personal financial situation and loan options.

Applicable fees

You could be required to pay extra fees to secure financing, depending on what type of loan you take out. These fees aren’t listed on the BMO website, so you’ll need to make sure to check in with a BMO rep to find out more about how much you’ll have to pay.

How do I apply?

If you’ve done your research and you think a BMO business loan is the right fit for you, there are a couple of steps you’ll need to follow to get started:

  1. Book an appointment. You’ll have to start by booking an appointment with a BMO representative at a physical branch.
  2. Collect the necessary paperwork. You’ll likely be asked to bring certain documents to your appointment, such as statements of your annual revenue.
  3. Fill out an application. You’ll work with a BMO rep to fill out your application in full. It will take some time for it to be processed.
  4. Negotiate the terms for your loan. You may need to negotiate with BMO to get the rates you want for your loan (which could include putting up assets or signing up with a guarantor to bring your rates down).

What happens after I apply?

BMO will review your application and make a decision. Since it doesn’t accept online applications, it could take several weeks for BMO to fully process your information. That said, for applications that aren’t overly complicated, you should have a decision within a couple of days.

I got the loan. Now what?

As soon as your loan is approved, you’ll be able to spend the money you take out on whatever business expenses you want. From there, you’ll be required to start making repayments on your loan through automatic withdrawals from your bank account.

Frequently asked questions

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