When it comes to running a successful restaurant, you’ll absolutely need financial support in one way or another. Now, in today’s world, there are dozens of options out there to get restaurants off their feet. Yet, there are quite a few challenges for restaurant owners just starting out. Fortunately, more businesses are cropping up and working with financial institutions to provide people with the loans they need without the headache of going through banks.
Benefits of Alternative Funding vs Banks for Restaurant Owners
While banks are able to provide loans, they’re not always the best choice for soon-to-be or current restaurant owners. They can provide the funding, but they also typically require collateral, a great deal of paperwork, and loan amounts to be higher than $200,000 – $250,000.
Provides Restaurant Owners An Opportunity
Banks don’t always have the money, and they’re pretty particular about who can receive funding in the first place. This often closes the door to startup restaurant owners because they won’t dish out cash below the numbers we walked about above. Luckily, alternative financial institutions are more common now than ever, and they’re willing to work with small businesses regardless of the loan amount. Which is great for new businesses looking to get the ball rolling with hiring employees, obtaining equipment, and even acquiring some real-estate. Beyond that; however, loans from alternative businesses are great for anyone looking to expand.
Provides Restaurant Owners Quick Funding
Applying for loans through a bank as a restaurant owner can be a long and stressful process. Not only do they require an application, but also a variety of personal and financial documents. Beyond that, banks will go through a review period followed by an in-person conversation with a representative. The qualification process can take months at a time, and even after approval, it could take a while to receive the money.
However, when you go to alternative funding, you’ll receive guidance during the application process to make sure you’re qualified. Once that’s done, you can receive funding in as little as 24 – 48 hours (although, some may take a week or more).
Banks Cost Restaurant Owners Money During The Application Process
In contrast to alternative funding, banks actually have fees during their application process. If you were to go to a bank, they’d absolutely require you to pay several upfront costs without any guarantee of getting the money. In comparison, alternative funding is pretty inexpensive if you’re a restaurant owner.
The Three Cs And How to Qualify For Loans
In order to determine whether you’re a qualified restaurant owner, 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 600 – 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.
Finances Factory Helps Restauranteurs Finance Their Finance
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!