By: Julia Aidan
Submitted: 2009-05-19 05:56:04 | Word Count: 552
Most people think that to successfully operate a franchise business, it is vital to look at the track record of available franchises to determine which one will most achieve longevity in the industry. While it is true that choosing the right type of franchise is key, this is actually not the first step that you need to consider.
Because of the way the market has changed over the years, it is important 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.
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The Patriot Express
The Patriot Express is a lending program administered by the Small Business Administration or SBA. The program is geared towards:
- Active duty military personnel who are about to retire
- Veterans
- Members of the National Guard
- Military spouses
Under the Patriot Express program, borrowers may borrow up to $500,000. Although the SBA does not provide this loan to applicants, many lender participants are eager to offer this loan because the SBA guarantees 75 to 85 percent of the loan. This means there are considerably fewer risks shouldered by the lending agency and so they are much friendlier to potential borrowers. It is also easier to qualify as the credit score required for it is not set so high.
Interest rates are also friendly as lenders are required by the SBA to impose not more than 2.25 percent for loans of less than seven years, and not more than 2.75 percent for loans exceeding seven years.
A detailed explanation of eligibility criteria set by the SBA can be found on their website but these typically include:
- Business size
- Use of funding
- Type of business
- Alternative sources of funding
The VetFran
The Veterans Transition Franchise Initiative or VetFran was initiated by the International Franchise Association (IFA) to help military veterans. The IFA partners with more than 350 franchise corporations and encourages veterans to go into franchising by extending financial incentives. The program itself does not offer funding, but the IFA's franchise partners do provide financing or help applicants choose the right lending program.
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.
Consulting franchise funding specialists is advantageous because they are well-versed in the ins and outs of franchising. They have a wide network with which they have cultivated relationships so your applications will go along much more quickly and smoothly.
Depending on your situation, these specialists will draw up a list of available lending options for you as well as come up with the actual figures that you have to work with. Franchise funding specialists usually don't charge a fee for their services until after you have received your loan. This is another feature that works in your favor as you get actual help without shelling out cash first.
Author Resource:-
If you are facing financial difficulty Wilson Field can provide free debt advice on IVAs or Bankruptcy. If you have ever taken out PPI on a loan it may have been mis-sold and Real Claims could help you reclaim PPI charges.
