How gas station owners can finance or re-finance gas station real estate. Most banks do not need to lend on this type of property because they do not understand this business. Kendall Schnieder has been in the commercial property finance business since the mid 90's and has a particularly close working relationship with some extraordinarily assertive banks.
For the last year, gas station financing has been rather tough, but that is all changing now. I say that with one clarification ; deal with banks that know how gas station financing works. So be certain to work with 'knowledgeable' brokers and banks, you may save yourself a heap of time and frustration, and you can actually walk away with some cash in hand when you work with a knowledgeable lender.
One other note before you run out to get that loan, be advised that SBA does not like ARCO stations. The SBA will not fund ARCO due to ARCO's contracts that just about leave the lender out in the cold if the borrower runs into a default situation. ARCOs can be financed through conventional lenders, but they are lending only on the value of the property, and will not consider business and inventory values. Loan to value is as high as 70% which means that the borrower must come up with thirty percent down plus closing costs. As of this writing, these rules apply only to ARCO franchises, I do not know of any real problems in obtaining loans for either independents or major distributors. Naturally, the lenders are looking awfully close to credit worries and profitability of the business.
The time for obtaining loans for gas stations and convenience store combinations, especially if the loan includes property, hasn't ever been better. Because of the liquidity crunch, sellers are making some amazing deals on the business and the real estate. For the clever business owner, now is the time to either purchase a gas station, or refinance your existing business for one amazing reason, INFLATION! If you buy at reduced prices and fix your value of possession, then inflation is going to be your pal.
Gas station financing could be an awfully nice experience. And if you choose scrupulously who you deal with, you can get your cash in as little as thirty days after you have submitted all your forms. SBA will lend up to ninety percent on qualified gas stations. If your station is in a country area, be certain to ask your lender about a USDA loan. USDA loans are backed by the govt, and they are aggressive in their underwriting to place the loan quickly.
One other point to consider with gas station financing, be certain that you are financing long-term investments. Don't include cars and other items that depreciate quickly. Pay for those items with short term money. Make your next loan work for you for the long term, it can be really profitable.
To get approved for Gas Station Financing Click Here
Kendall Schnieder works alongside preferred SBA lenders in the Western US and specializes in commercial property loans. He can be reached at Gas Station Financing
