If a franchisee is unable to secure a commercial bank loan or an SBA loan, alternative lenders may be an option. Their approval process is faster and less stringent than that of traditional lenders, but the interest rates are generally higher and the repayment periods are shorter.
Franchisees can apply for a commercial loan with a bank of their choice. Approval usually requires a good credit rating and a detailed business plan.
In some cases, franchisors may offer financing directly through the parent company, but more commonly, they partner with preferred lenders who administer the loans to their franchisees.
Because the federal government backs a portion of SBA loans, they generally have more favorable interest rates and repayment terms than commercial banks loans.
Options for new & existing franchisees
Growth-friendly underwriting and loan terms
Competitive fixed and variable rates
Flexible collateral options
