Financing a restaurant franchise that has only a few units

Financing a restaurant franchise that has only a few units

Hi Beau,
My partners and I have been working with a local bank trying to get SBA financing. We are getting pushback from the lender, saying that although the franchise is in the SBA Franchise Directory, they only have 13 franchisees and they're wanting us to come in with more down payment. They say this is a higher risk.
Any ideas or solutions that may work for us?
Thank you!
Nate

Timestamps
[00:37] Financing a restaurant is an emerging franchise concept
[01:03] Look into Franchise Disclosure Document (FDD) Requirements
[01:24] The biggest key to do is to find a lender that likes your franchising concept
[01:44] What is the problem that you might face?
[01:56] Work with a commercial mortgage advisor to take it to multiple banks and non-bank SBA lenders to obtain a high-level conversation about your deal
[02:09] Figuring out which bank has the highest leverage and the best rate
[02:22] The margin is negotiable
[02:40] Finding the right lending institution for you
[02:53] We don’t charge you a fee to bring deals to the banks
[03:15] Book a call at http://bookwithbeau.com/

In the video, financing options for a restaurant franchise that has only a few units and is facing difficulty in obtaining SBA financing from a local bank are discussed. The lender is requesting a higher down payment due to the franchise being considered a higher risk due to its slow growth and lack of a proven record. To overcome this challenge, it is suggested to find a lender that is favorable towards the franchise concept or industry vertical, and to work with a commercial mortgage advisor. This advisor can present the application to multiple banks to find the best deal with the highest leverage and the best rate. The services of a commercial mortgage advisor are offered without a fee, as they are incentivized to bring deals to banks. Different financing options, such as 7A or 504, can also be discussed, and calls can be scheduled to answer any questions.

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#franchisefinancing #sba7a

About Beau: Beau Eckstein is a real estate entrepreneur, TV personality, and commercial mortgage advisor, specializing in construction financing and multi-family lending.

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