Let’s cut to the chase, you’re reading this because you want to know the loan options for your restaurant. Perhaps you’re considering a startup, or maybe you’re already operating an established business. Regardless, I’m sure you’re aware of the difficulties of starting and running a restaurant.

As a current, or would-be restauranteur, there are plenty of costs to consider when it comes to working in the food industry. Expenses include, hiring contractors for installations and renovations, but also food, utensils, furniture, appliances, cooking equipment, and– well, you get the point.

And unless you’re sitting on an immense amount of money that’s readily available, you will need to look into loan options for your restaurant. So, while funding a restaurant can be a daunting task, we’re fortunate enough to have a variety of loan options available.

6 Types of Loan Options For Your Restaurant

  • Startup Funding
  • SBA Loans
  • Business Express Loans / Business Lines of Credit
  • Revenue Based Loans and Advances
  • Equipment Finance
  • Franchise Funding

Startup Funding: Loan Options For Your Restaurant

You can receive up to $350,000 in unsecured personal and business finances through startup funding. However, you must have at least one guarantor with a credit score between 680 – 800, with an ideal score of +660. In terms of interest rates, they’ll be 0% for up to 21 months.

SBA (Small Business Administration) Loans: Loan Options For Your Restaurant

So, to qualify for an SBA loan you must have an existing business with tax returns proving good cash flow. As for your interest rates, they’ll be anywhere between 6% – 8% with a payback period of 10 – 25 years. However, they do take a bit longer to get than other loans, and can range anywhere between two weeks to two months (14 – 60 days). SBA loans offer the highest amount of cash possible for small businesses with the lowest rates.

Business Express Loans / Business Lines of Credit: Loan Options For Your Restaurant

Non-SBA business express loans and business lines of credit provide upward of $500,000 and can be received in 1 – 2 weeks. To qualify, you must have an established business and proof of revenue. As for interest rates and terms, they vary based on the individual.

Revenue Based Loans and Advances: Loan Options For Your Restaurant

Revenue Based Loans provide small businesses anywhere from $10,000 – $1,000,000 and can take as little as 48 hours to become approved. These types of loans are typically for businesses who are making money but don’t have a long business credit history or score to qualify for other loan options. In regard to interest rates, both terms and rates will depend on the individual.

Equipment Financing: Loan Options For Your Restaurant

Equipment Financing is used for anything ranging from storage, supplies, utensils, appliances, cooking equipment, and so on. They are easy to receive due to the fact that the equipment is the collateral. This means the equipment itself would be returned in the worst case scenario. As for loan amounts, terms, and interest rates, they’ll vary.

Franchise Funding: Loan Options For Your Restaurant

Done through bank partnerships, Franchise Funding provides creative and flexible loan terms with interest rates between 6.25% – 7.25%. However, this loan type has a variable rate of prime rate plus 2.75% – 3.75%.

Loan Options For Your Restaurant: The Three Cs of Qualifying

In order to determine whether you qualify, Finance Factory looks at the Three Cs: Credit, Cash Flow, and Collateral. Although the ideal credit score is 660+, they’ll look at anything between 680 – 800. As for cash flow, they like to see account balances of $1,000 – $5,000, minimum, but also look at monthly and annual revenue. And when it comes to collateral, Finance Factory primarily focuses on providing unsecured loans; however, they will accept collateral. It’s important to know that you only need to provide one of the Three Cs in order to qualify.

Finance Factory helps you find the best loan options for your roofing business

Interested in finding funding for your business? Finance Factory would love to help! If you’re looking to fund your business within the next 30 to 90 days for $25,000 to $500,00 and have a credit score of 660 or better, let’s chat! Get pre-qualified right now with our quick-step pre-qualification form! And don’t worry, this will not result in a hard credit inquiry of sensitive information. We just want to learn more about you and your business. Click below to get started!