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Q: How Do You Qualify for Franchise Financing?

Qualifying for a franchise loan is similar to qualifying for any other kind of loan. Remember, to start you also need to meet the franchisor’s requirements. At a minimum you will need these qualifications: Acceptable personal credit history. Your personal credit score reflects whether you are reliable as a borrower. Check your credit history to make sure all information is accurate before applying for any kind of franchise financing. Your small business credit score may also come into play if you apply for credit for an existing business. Required down payment. Almost any kind of SBA or conventional business loan will require a down payment. Financial information. Be prepared to submit a business plan — or revenue and expense forecasts, or a P&L. Franchise information. Lenders want to know: is the franchise brand an established name, with a track record of successful franchisees?

Q: How Do You Buy a Franchise With No Money?

The short answer is: you cannot buy a franchise with no money. Every franchise requires an initial investment. While it’s not possible to buy a franchise with no money, you can target lower-cost franchises. See: Franchises under $10K Franchises under $20K If you have no money at all, think longer term — and plan. Sometimes it’s best to step back, accumulate savings, and apply for financing options later after your financial situation improves.

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