Franchise Financing

Franchise financing can be a frustrating process without knowing your options. Apart from your local bank, these options fall under 3 main categories:

1. SBA Financing

The U.S. Small Business Administration (SBA) guarantees loans for private banks/lenders. Loan programs up to $5,000,000.

2. Non-SBA and Specialty Financing

There are commercial lenders that specialize in franchise financing through equipment leases and structured term loans. There is also the ERSOP program, using your 401k or IRA as start-up capital without penalties, taxes or distributions.

3. The Franchisor

Many franchise companies either offer financial assistance themselves or help franchisees find a bank or other lender. Most have a lists of "preferred lenders".

Personal Assets

Whether it's SBA or non-SBA financing, anywhere from %15 to 30% of the total capital need can be required of the borrower. Franchise start-up costs vary wildly across franchises, so this could be anywhere from $20,000 to $200,000. A borrower may need to refi their personal propery or liquidate stocks, bonds, IRAs, 401k, etc.

How to Get a Commercial Hard Money Loan

Discover how to get a commercial hard money loan. You'll learn how to finance commercial real estate opportunities that normal banks will not lend on. Specially, this video covers the basics of Hard Money, an example of a deal funded with hard money, the major differences between hard money and traditional bank financing, the 3 most common questions, how to steer clear of fraudulent hard money lenders.