When it comes to operating a franchise business, most people look first at available franchises’ track records to see which one is most likely to stay in operation. While this is a very vital thing to consider, it’s not the first step you should make.
Because of the way the market has changed over the years, it is vital to get your financing strategy down pat before moving on to your list of franchise businesses. If you are not sure on how to go about funding, consider the following options.
The Patriot Express
The Patriot Express is a lending program administered by the Small Business Administration or SBA. The program is geared towards:
- Retiring military personnel
- Military veterans
- Those in the National Guard
- Spouses of military servicepeople
Borrowers may take out loans of up to $500,000 under this program. The SBA doesn’t offer this loan itself, but instead guarantees 75-85% of it for other lenders. This means banks and moneylenders carry much less risk when giving out such loans, which in turn means it’s relatively simpler to get the loan. In addition, the credit score requirement is not very high.
The program also carries comparably low loan rates. Loans that are payable in seven years or less, charge only as high as 2.25%. Loans payable in longer terms carry only a maximum interest of 2.75%.
To be eligible for the loan, there are certain criteria that have to be met, including:
- The size of the business
- Use of funding
- Type of business
VetFran Initiative
The VetFran (Veterans Transition Franchise Initiative) assists veterans of the military service through its partnership with the IFA or International Franchise Association. The IFA has links with more than 350 franchise operators in the country. The VetFran Program does not provide the loan but its partners can help veterans find loan sources and select franchises to place their money into. Getting into a franchise business is a excellent way for veterans to continue earning money and staying active at the same time.
Franchise Funding Specialists
Franchise funding specialists can help you devise a financing strategy so that you may narrow down the best lending options available to you. All you have to do is provide them with all the necessary information and they will do the leg work for you.
It is worthwhile to enlist the help of franchise specialists because of their knowledge and experience about the ins and outs of franchise operations. Their extensive network in the franchise business is also a huge plus, freeing you from unnecessary stress and saving you time.
Another excellent reason to use the services of franchise funding specialists is because they don’t charge anything until you get the loan you’re looking for. But before then, they’ll be coming up with several schemes of getting funding, as well as the actual figures that you’re likely to be dealing with.