Car Wash Financing


Typical Loan used:  SBA 7a – (includes closing cost, construction interest, & working capital)

Max Amount of Loan:  $5,000,000 (Typical car wash loans range from $2 M to $4 M.)

Length of Loan:  Typically 20 to 25 years

Amount Down:  Typically 10 to 20% – contact us for specifics

How Funds are used:  Available for Ground Up Construction or Existing Property

Do I qualify for loan:  Contact SBA-Capital for your free loan review and Pre-approval

Cost of loan:  Depends on experience, amount down, etc. Contact us for details

Most popular loan:  SBA 7a (includes closing cost, construction interest, & working capital)

Comments about SBA loans:

  1.  All funds are provided by the bank. SBA only provides a guarantee.
  2. Some say SBA loans are complicated and take too long which is true unless you are working with a loan official that is experienced and knows how to process the loan.
  3. Banks had $585 billion dollars in outstanding SBA loans in 2013 simply because SBA guaranteed part of the loan. The staggering numbers show the popularity of SBA loans.

The above are general comments and may vary depending on some borrowers needs and financial ability. Please contact us for details regarding any specifics you may have.

Is your car wash in need of an equipment upgrade?

Finding capital is easier than you might think.

Staying on top of newer trends and changing technology can make your car wash more profitable, but planning an upgrade can be daunting. It seems like new options for upgrades become available each day, and many car wash owners don’t know where to begin. Updating tunnel equipment offers a number of advantages, such as increased energy efficiency and a more effective use of chemicals. When properly implemented, new equipment can also increase throughput and improve wash results. If you’re not sure if it’s time for an upgrade, ask yourself these question:

Free E-Book Car Wash Turnaround ToolKit

  • Is your current equipment running efficiently?
  • Does your current equipment accommodate customer volume in a timely manner?
  • Do you often find that your equipment is in need of repair?

If you answered “Yes” to any of these questions, it may be time to consider an upgrade.

Do Your Homework Equipment is a primary component in your car wash.  Before investing in an upgrade, it’s important to thoroughly research equipment manufacturers and the costs associated with a package such as price of equipment, installation, and available financing options. In addition to cost, there are other factors to consider when selecting upgrade equipment. Equipment quality and efficiency will impact your gross margins. Some equipment will have higher depreciation costs, while some will be less efficient than others. Consider variable costs, including electricity, natural gas usage, water, chemical detergents, and customer claims resulting from equipment caused vehicle damage. All of these factors contribute to operating costs and your ROI. Be sure to factor in repair and maintenance costs for the short-term annual replacements like cloth, and finally the long-term depreciation costs based on the life of the equipment.

Financing At Every Step Whether you are building a car wash or purchasing an existing operation, you will need to secure financing. The most common approach to finance an original purchase or construction of a car wash is with a local bank. Over time, the specifics of your loan (principal, interest, monthly payment) will stay the same.  However, the recent flurry of bank consolidations and mergers, especially among community banks, makes it likely that the “holder” of your loan may have changed. When it comes time for a renovation or equipment upgrade, many owners apply to their original mortgage banker only to discover that individual is no longer with that institution, and the relationship must be re-established. Banks often compete with each other, especially in confined geographies, which may lead to more favorable rates, terms, and working relationships. It will pay dividends to shop your renovation refinance to secure the best financing option for you. Another option is to refinance the car wash to a lower interest rate for a longer period of time in order to raise capital and fund equipment upgrades. Interest rates are currently at a historical low but experts predict that they will soon begin to rise. Loan terms are often fixed for a short time, then go to a variable rate with 15 to 20 year terms. Quick loan approval can be the differentiating factor in remaining competitive in the marketplace.

Finding a partner you can bank on. It all begins with a financial partner who understands the car wash industry. Your ideal partner will be experienced in the unique seasonal needs of the car wash industry. The mortgage banker you select must understand the steps involved in equipment upgrade financing. This might include the loan approval cycle, documentation requirements, underwriting and environmental studies. If the mortgage banker is inexperienced and fails to follow through on even the most minor detail, closing the loan may take six months or more and jeopardize your project. Selecting the right mortgage banker can shorten the process to close on the financing to just six weeks. The ideal mortgage banker will be experienced in car wash equipment financing, with a substantial track record of success. They will streamline the process from approval to closing, while holding you accountable to provide the required documentation in a timely manner. Choose wisely, and your equipment upgrade can be a positive experience for you and your customers.

Hershel Pierce is the Founding Director of Pavilion Bank and SBA-Capital based in Dallas Texas.  For over 30 years, SBA-Capital has offered SBA loans to car wash owners to finance both equipment upgrades and ground up construction nationwide. SBA-Capital has successfully completed financing for hundreds of properties, matching car wash owners short and long term financial needs to the best SBA loan programs available.

How To Secure & Close A Car Wash Loan

Creating Custom Financing For You