How to Get Financing for Your Franchise

Last Updated on June 1, 2016

how to get financing for your franchiseThe freedom to be one’s own boss yet work within an already proven business plan draws many to purchase franchise businesses.

For owners of successful franchises who wish to expand or to open another franchise, there are usually three financing options. Franchisees can apply for a traditional bank loan, apply through the Small Business Administration’s (SBA) standard 7(a) loan program, or seek franchise financing through an alternative financing company.

Financing for your franchise

Where to Get Franchise Financing

Both traditional banks and the SBA have initial drawbacks in the amount of documentation and paperwork that each requires. Additionally, banks charge application fees and the SBA requires both collateral and personal guarantees.

Loan applications for both include a borrower information form, extensive personal and business financial histories, resumes, profit and loss statements, and several years of income tax returns.

For the SBA loan, a bank must first approve the application. A loan rejection can send an applicant to another bank to restart the entire process. Either way, months may pass before approved borrowers receive their financing.

This will prove frustrating to franchisees, who know that time is their enemy. Quick access to working capital is imperative to take advantage of opportunities such as a prime location before it is leased by a competitor. Many franchisees are bypassing the traditional financing sources and directly seek a trustworthy alternative financing company.

Alternative Franchise Financing on the Rise

While 2015 statistics are not yet available, FRANdata, the franchise industry forecaster, projected that alternative financing would provide a 4% market share of the estimated $30.1 billion franchises had been expected to borrow during fiscal year 2015. While that percentage may seem small, consider that it amounts to $1.2 billion in financing.

Do You Qualify for Franchise Funding?

With National’s streamlined and expedited approval process with simplified qualifications, chances are you do qualify! All you need is:

  • 6+ Months in Business
  • $120,000 in Annual Gross Sales

To qualify for franchise loans through National – no minimum FICO score required. This is great news for those with bad credit seeking franchise loans.

However – if you do not meet the above requirements, a FICO score of at least 650+ is needed to qualify.

Franchise Loan Calculator: Find the Optimal Rates, Terms & Amounts for You

National offers franchise loans with:

  • Loan Amounts: $10,000 – $5,000,000
  • Flexible Terms: 6 Months – 10 Years
  • Time to Funding: Between 48 Hours – 7 Days

To find the best franchise loan option that best fits your specific franchise needs, use our franchise loan calculator by clicking the link below. Adjust the sliders to determine the best franchise loan interest rates, terms and conditions work for you.

Go to Franchise Financing Calculator

How to Get Franchise Funding Today

As a trusted alternative financing company, National Business Capital’s goal is to establish strong financial relationships with our clients. We strive to assist them obtain the financing they require to ensure that their franchise businesses continue to thrive.

If you have questions about franchise financing, please give our Business Consultants a call at (877) 482-3008 for a free consultation. Or, apply now by filling out our 60-second application online, and get the franchise financing you need in as little as 24 hours.

Learn More About Alternative Franchise Financing

For more information on how to get business funding when banks say no, download our FREE eBook today:

National Business Capital & Services is the #1 FinTech marketplace offering small business loans and services. Harnessing the power of smart technology and even smarter people, we’ve streamlined the approval process to secure over $1 billion in financing for small business owners to date.

Our expert Business Financing Advisors work within our 75+ Lender Marketplace in real time to give you easy access to the best low-interest SBA loans, short and long-term loans and business lines of credit, as well as a full suite of revenue-driving business services.

We strengthen local communities one small business loan at a time. For every deal we fund, we donate 10 meals to Feeding America!

About the Author, Megan Capobianco

Megan is passionate about helping business owners along their journey - providing them with relevant content they can use in their day-to-day operations.

Disclaimer: The information and insights in this article are provided for informational purposes only, and do not constitute financial, legal, tax, business or personal advise from National Business Capital & Services and the author. Do no rely on this information as advice and please consult with your financial advisor, accountant and/or attorney before making any decisions. If you rely solely in this information it is at your own risk. The information is true and accurate to the best of our knowledge, but there maybe errors, omissions, or mistakes.