How SBA Loans Work for Daycare Franchising

The daycare franchise industry has continued to grow over the past five years, and is projected to continue. There are many profitable franchise opportunities with proven business models, so you wouldn’t be starting this journey on your own. There are a handful of steps to take if you’re thinking about joining this booming market, so now is a good time to look into SBA loans and how to finance a franchise.

SBA Express loans can fund working capital, purchase equipment, and purchase owner-occupied commercial real estate so you can use it in whatever way best suits your needs. This type of loan is well-suited for preschool and daycare owners who need franchise financing. When you finally select which daycare franchise opportunity you will invest in, having your financing figured out will make the process much smoother.

Build a new center: When you’re literally starting from the ground up, a variety of costs need to be considered. Construction, security systems, safety equipment, and even furniture are among the things covered by an SBA Express loan.

Buy out a partner: When you start your childcare franchise you might have a business partner. If, down the road, that partner decides to retire it’s good to know that you can use your SBA Express loan to buy their stake in the business. This will keep everything running smoothly without having to worry about your portion of the business.

Refinancing business debt: Depending on the type of debt you carry, you could be eligible for refinancing through an SBA Express loan to lower your costs. Being able to get a better interest rate will not only help your immediate monthly costs, but allow you to pay your debt off earlier.

Purchase an existing preschool or daycare: Sometimes new construction isn’t necessary if you’ve found an existing building in a great location. An SBA Express loan can help you purchase and modify the building to meet your needs, so you can open your doors and get started as soon as possible. 

SBA Express loans are the fastest way to secure SBA financing, but there are other options as well. If you have a smaller daycare or preschool, an SBA microloan might be a better fit. It offers up to $50,000 with less restrictive credit requirements. 

No matter which turnkey franchise opportunity you select, how you finance will be an important component of your business plan. An SBA Express loan or an SBA microloan are two great options to make your dream a reality.