Here’s How You Can Get Car Wash Financing With SBA-Capital

As yields began to soar in 2022, the commercial credit market froze, leaving hundreds of million-dollar deals to collapse. Unfortunately, this left many small business owners struggling to get the financing they needed to start their dream businesses or even renovate and improve their existing businesses.

Although threats of recession, economic downturn, and rising interest rates are all uncontrollable factors that can lead to the freeze of commercial loans, SBA-Capital has been consistently providing car wash loans for the past 40 years. At SBA-Capital, we can quickly and easily provide you with the funding you need to run a successful car wash. We can set you up with an SBA 7a or 504 car wash loan to help you launch your business and cover your closing cost, construction, and working capital.

Here Are 5 Things You Should Know About Getting Car Wash Loans from SBA-Capital

1. What Are SBA 7a and 504 Car Wash Loans?

First things first, what exactly are the SBA 7a and 504 loans? These are loans that are guaranteed by the government through the U.S. Small Business Administration (SBA), which is dedicated to helping individuals start and grow small businesses in America. SBA loans can often cover the cost of starting a business, real estate purchases, and more. Here are more details on each type of SBA loan. 

SBA 7a – SBA 7a car wash loans are the most popular way to finance a car wash. In fact, they are known to be the most common loan program the SBA has. These loans are the best for purchasing real estate, and they can also be used to purchase furniture, and supplies, pay for closing costs and refinance debt. SBA 7a car wash loans are available up to $5M. 

SBA 504 – Like the SBA 7a, the SBA 504 loan is also a government-backed loan for small businesses. SBA 504 car wash loans can be anywhere between $500K-12.5 million. These can be used for convenience stores, daycares, carwashes, franchise restaurants, medical offices, hotels and more. At SBA-Capital, we can get you started with car wash loans to purchase an existing car wash or start one from the ground up.

2. The Interest Rate for SBA Car Wash Loans

SBA 7a interest rates are adjusted quarterly based on prime rate. Prime rate is influenced by the federal funds rate. Borrowers typically select SBA 7a for loans up to $5M and SBA 504 Loan are typically over $5M. SBA 504 “Green loans” can go up to $40M.

SBA 7a loans are typically 80% LTV and will adjust quarterly based on prime rate plus the agreed to spread. SBA 504 loans are typically 20% equity, 30% SBA Debenture, and a 50% conventional. The conventional  is typically an adjustable rate loan. The 30% Debenture is a fixed rate for 25 years. Interest rates for the Debenture in the later part of 2022 ranged from 5.9% to 6.3%.

3. How Can SBA 7a & 504 Car Wash Loans Help You Jump-Start Your Business?

When it comes to owning a car wash, the down payment can be quite expensive. The typical down payment for an SBA loan is 20% which can be reduced to 10% by monetizing existing assets. The down payment for a conventional loan is typically 35% to 40%.

With an SBA car wash loan your interest rate is typically less than a conventional loan.  SBA car wash loans are typically for 25 years vs. a much shorter time for a conventional loan making your SBA car wash loan monthly payment much less than a conventional loan.

4. Keep Your Business Up to Date With SBA 7a & 504 Car Wash Loans

Like any business, it is highly important for car washes to stay up to date, have modern equipment, and get renovated from time to time. While it can be costly to upgrade your car wash, it is an investment that will keep your business relevant and competitive against other car washes in the area. Getting an SBA 7a and 504 car wash loan can be a great way to get the money you need to take your business to the next level.

5. Go Into Business Safely and Project Your Car Wash Earnings

Starting a business takes a significant amount of capital. Whether you use your own money or take a loan, it can feel intimidating to spend all that money on your business. At SBA-Capital, we have helped hundreds of car washes launch their businesses. Put simply, we know what works and what doesn’t. Before taking on an SBA loan, we can help you safely and efficiently plan for your future. We will help you project your car wash earnings before you even purchase or build your car wash. That way, you can safely invest in yourself while knowing that the plan works. We can also provide you with a loan analysis to ensure you get the best interest rate and make good loan choices.

Get A Loan From A Partner With An SBA Expert Reputation Nationwide. 

At SBA-Capital, we strive to provide you with the best service possible. We make SBA car wash financing a smooth and simple process from start to finish. Even when the market experiences volatility, we’ve got your back. We can help you get the car wash financing you need to launch or improve your business.

If you’re interested in getting started with an SBA loan, contact us at pierce.pavbank@gmail.com or give us a call at (214) 726-9000.