You‘ll need to have been operating for a certain period of time (generally at least 3 to 6 months) to be approved for a Business Loan. Generally, lenders will require a mortgage over real estate as security for the loan together with general security agreements. Some lenders do offer loans for a new business.
FRANCHISE FINANCE overview
Franchise Loan is generally a loan used to purchase a franchise license, which allows the franchisee to either: 1) sell a product; or 2) provide a service under the name of the franchisor in exchange for royalty and annual licensing fees.
Getting approved for franchise financing can be difficult, particularly if you need start-up funds, you have bad credit, or your franchise has been open for less than a year.
Here are common Business and Franchise loan requirements you’ll find when applying for a loan:
- Credit score. Lenders typically examine your personal credit report
- Age of your business
- Annual revenue
- Personal debt-to-credit ratio
- Net operating income
- Potential collateral
- How you intend to use your funds
Teo Torrelli, Director of MKS Lending Group has been arranging Business and Franchise loans since 1985. He will work with the banks to get your loan while you concentrate on running your business.