If you’re buying a franchise — whether it’s a convenience store, an automotive service center, or any other established brand — select a lender that will stress-test your loan proposal to ensure it performs in a down business market.
I’ve worked with franchise buyers since 1982 across dozens of industries — from branded convenience stores to Grease Monkey automotive franchises — and I’ve seen what happens when buyers assume the path of least resistance is also the path of best terms. Sometimes it is. Often it isn’t.
Make Sure Your SBA Franchise Loan Includes:
A well-packaged SBA loan for a franchise acquisition isn’t just the purchase price. It should include:
- Startup working capital — the gap between signing day and your first profitable month is real, and you don’t want to be caught short on cash right out of the gate
- All closing costs folded into the financing — no surprise bills at the table
- SBA guarantee fees covered — one less thing to fund out of pocket
- Renovation or improvement financing if the location needs work
When those pieces aren’t included, the buyer has to fund them separately — often through more expensive financing, or straight out of operating capital.
The Questions Every Franchise Buyer Should Ask
Treat the franchisor’s preferred lender list as a starting point, not a final answer. Before you commit to any lender, ask these questions directly:
- Is startup working capital included in the loan package?
- Are closing costs and SBA guarantee fees rolled into the financing?
- What’s the realistic timeline from application to closing?
- If an issue comes up in underwriting, who advocates for me?
Those four questions will tell you a lot about what you’re actually getting. And if you want an independent analysis to compare, that’s exactly what SBA-Capital does — at no cost.
A Note for CPAs, Brokers, and Advisors
If you’re advising a client on a franchise acquisition, this conversation is worth having before they lock into a lender. SBA-Capital provides a complete EBITDA analysis at no cost and no obligation — so you and your client can evaluate the deal with real numbers in hand before committing.
It takes the guesswork out and often surfaces structuring opportunities that keep more capital working in the business from day one. The more prepared your client’s deal package is going in, the smoother the close.
Ready to Run the Numbers?
Text Hershel at (214) 726-9000 — that’s the fastest way to get answers.
I’ve been packaging SBA loans since 1982 and have worked with franchise buyers across convenience stores, automotive services, and dozens of other concepts. I’ve seen just about every scenario there is.
Email: pierce.pavbank@gmail.com
Web: www.sba-capital.com
I’ve financed small businesses nationwide since 1982. When the clock is ticking, experience matters.