Start a Restaurant

Restaurant funding is not so easy for restaurateurs, but a financial loan consultant can be more helpful to you then someone that offers only a merchant cash advance.

The restaurant industry suffers from getting additional financing when they are already open. Fortunately due to a new alternative of a unsecured small business loan, it is now possible to either get immediate funding or prepare for it.

On top of the very poor economic climate due to the mortgage crisis, anyone thinking of getting restaurant funding in any where between California and New York, opening a restaurant or already operating a restaurant has to deal now with the recession, consumer spending lowered, banks not lending out money even to those with great credit.

If you do not need financing at this moment for your food dining business, prepare for it by educating yourself especially on this type of financing that does not require collateral to get funded, so that when you need it, you are not caught off guard with what it is and what it is not!

There are some alternative business funding options, but need to know where to find them. A mortgage broker is not the place to go and for business financing, ok for real estate financing but not the right emergency source since he or she can only help if you own real estate.

You need to go to someone whom has contacts with a wide range of money lending sources. You need to go to a Loan Broker or Financial Loan Consultant (same thing) who can provide you with full service alternative business financing solutions.

They differ substantially from a mortgage broker! The mortgage brokers only do mortgage loans no help to you since they do not have contacts for insider money lending sources that lend to business owners, a loan broker financial loan consultant is a 1 stop shop for alternative money lending sources.

A financial loan consultant can help save you time, when you have a need for a time sensitive situation that requires very fast no hassle financing.They have many different money lending sources, from companies to private individuals that will lend their money for time sensitive deals at a higher interest, a premium to you for his money because he or she can deliver you the money quickly and hassle free no long applications to fill out or long waiting time to get your money, you can get funded in some cases in 24 hours.

Some Examples of Funding Sources

1) Foreclosure bailout lenders if you own the property where your restaurant is located
2) Business cash advance companies
3) Equipment sales-leaseback on your restaurant equipment
4) Restaurant equipment leasing companies
4) Mortgage note buyers will buy your mortgage note
5) Hard money lenders will lend in 3-14 days based on property assets
6) Have another business which has accounts receivables look into factoring

Seek out full service loan consultants that have access to a wide array of restaurant funding sources that will do emergency funding in California.

Author: Edwin De Leon
Article Source: EzineArticles.com
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Find restaurant expansion generally refers to business owners looking for financing to expand their existing restaurant. Businesses choose to add new restaurant locations when they experience a steady increase in profits and want to attract more customers. There are many financing resources available to expanding businesses.

If a business already has most of the funds it needs for restaurant expansion, but still needs additional financing, it may turn to factoring. Factoring allows a business to sell its accounts receivables at a discount to another company, called a factor. Factors require businesses to process credit card orders. Factoring is not considered a loan, and, depending on the factor, a business can obtain hundreds of thousands of dollars within a week’s time.

Another way to find restaurant expansion financing is to obtain a construction loan from a lending institution or construction company. Lenders usually require personal and business financial documents to assess the risk posed by a business. The higher the risk, the less likely a business will obtain the loan it needs. Construction companies may also offer financing that only requires a down payment and collateral to secure the loan. These companies generally provide better loan terms and interest rates than traditional lenders. One benefit of construction company financing is no payments until the construction is completed. Like with any financing option, the loan amounts, interest rates, and repayment plans vary by lender and by the applicant’s financial history.

Find restaurant financing generally refers to a potential business owner looking for funding sources for a new restaurant business. Once an individual has an idea of what kind of restaurant he or she wants to buy, funding that purchase is the next step. Restaurant financing is not much different from other business financing. Start-up business owners usually have some difficulty securing funds from traditional lenders, such as banks. Therefore, they look to other financial resources, including the Small Business Administration (SBA), private investors, non-traditional lenders, and many others.

The SBA’s 7(a) loan is available to small business owners who have been denied traditional loans and who have proof of ability to repay the loan. The SBA generally defines a small business as employing fewer than one hundred employees, and their loan funding is available for most business purposes, including restaurant financing.

Another way to find restaurant financing is to consult a private investor. In exchange for large sums of funding, private investors usually ask for a certain percentage of the business’s profits or to have a voice in business decisions. It’s important for business owners to find investors who provide equity, not debt. Debt means that the owner would have to pay interest on all or part of the amount invested.

Business owners may also look to financing from the restaurant’s current owner in order to find restaurant financing. When a seller is willing to finance a restaurant purchase, it shows that he or she is confident in the profitability of the business.

Author: Brynn Harveys
Article Source: EzineArticles.com
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Getting funding for a restaurant this year of 2008, is definitely harder on a national level is more difficult then ever before.

Why You Will Find It Difficult To Get A Loan

Unfortunately bank loan officers do not like to do restaurant financing! This year of 2008 is a very tough year, foreclosure rates the highest ever in the history of the United States, a credit crunch due to the mortgage crisis, lenders cherry picking their loans, even denying borrowers with good credit.

So as if the food and hospitality industry was not already difficult for getting restaurant loans, it is much more harder to get loans then ever before due to the recession that is happening currently around major cities in the united states, gas prices going off the roof creating a domino effect in many many industries, consumers not spending as much, going out less due to super high gas prices.

Restaurant failure is the main reason why bankers are Leary of lending money to a new start up restaurants, if the borrower applicant does not have a proven track record in the food and hospitality business.

Success for food service businesses is viewed by bankers as minimal. Their hesitation is due to higher failure rates in the industry for new restaurant owners with no experience opening a restaurant. Unless you have enough collateral to make the loan risk free, banks will usually not approve your loan. This belief is not well founded, since the data is skewed, therefore, it is not accurate and hurts you when you apply for a loan.

Traditional money lending institutions are Leary of lending money to a new restaurant, if a the borrower applicant does not have a proven track record in the food and hospitality business.

What Can You Do To Increase Your Chances Of Success With Your Restaurant

Restaurant Consultants — Set aside some money from your working capital to consult with one. They will help maximize your chances for restaurant success and minimize your chances for restaurant failure; this is the main reason to to speak to a restaurant consultant.

Restaurant Training — Seek out those companies that provide restaurant training

Restaurant Marketing — Become an expert in restaurant marketing, consult with someone who will help you create a great restaurant marketing plan. Implement a moving targets and birthday marketing campaign to generate immediate cash for your restaurant, which you can find out more info with the author of this article.

Restaurant Management Training — Seek a company that will train your restaurant manager.

Restaurant Accountants — Seek out CPA accountants that specialize with restaurant accounting software and restaurant accounting systems.

Restaurant Floor Plan – Warning, pay attention to how you layout the front, back, kitchen area! Could cause to lose profits if you do implement a good efficient cost effective floor plan.

What Are Your Restaurant Funding Options & Sources

Soliciting partners

* Selling stock
* Venture capital
* SBA
* Loans from relatives
Insurance policies cash values
* Credit from food suppliers
* Personal savings
Collateralized loans from your personal assets
* Credit from equipment suppliers

Up till now if you are having problems getting financing for your existing restaurant, your options were limited. There is a product called the business cash advance or merchant cash advance that is a possible solution to you when you find yourself being turned down for restaurant funding.

Copyright@2008

Author: Edwin De Leon
Article Source: EzineArticles.com
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Finding a restaurant loan to cover expenses after you have opened your restaurant or when you are opening a new restaurant can be difficult.

You may find that with economic situations and the uncertainty of the restaurant industry, that you may have a hard time finding the funding you need to open a restaurant. That is why it is important to consider alternative financing methods when you are looking for funding for a food service business.

These methods can help bypass things like excessive wait times when looking for a loan. These alternatives are not difficult to find when looking for a restaurant loan, in fact they can be quite easy to locate, apply for, and be approved for making them perfect for franchise holders and people who are opening their first restaurant or just a single location.

This type of restaurant loan alternative takes a cut or percentage of future sales done with credit or debit cards and uses these to pay back the cash advance. It is called a merchant cash advance and obtaining approval is not difficult at all. There are unsecured small business loans, unsecured business lines of credit, but still not as easy to get as a restaurant business cash advance!

If you are looking into getting a unsecured business loan, or unsecured business line of credit and have been denied for either one, the business cash product does not ask for collateral so it is a unsecured working capital advance to you.

This cash advance product is a perfect business loan alternative for owners of pizza, diners, fine dining or casual dining restaurants, that are having difficulty getting financing or just don’t have the time for the long approval and funding process from your bank and need the money quickly.

To qualify you will need to accept credit cards, have at least $2,500 a month in sales with Master card and Visa. Your credit either business or personal does not have to be perfect but you will need a few other things.

You will need to have been open at least 5-6 months and turn in a lease on your location, if you do not own it. You also have to produce 4 months of statements for both credit card processing and bank statements. You also must be free of open judgments, bankruptcies, and open tax liens for this type of advance.

Getting a restaurant loan can be difficult at any stage of the process, before you open a restaurant, for start up unexpected costs, building costs, as well as after you open for equipment or even to expand. The restaurant industry can be a difficult one to break into. There is an extensive amount of competition and small or family owned can often find it difficult to make ends meet. It is because of this that banks and other traditional and formal lending institutions provide strict guidelines for these types of loans.

For those that have less than perfect credit it can be nearly impossible, but with this business cash advance product your credit score is not a big issue with certain cash advance financing companies.

This is why finding alternatives for a restaurant loan is essential when you need financing quickly. You can receive a business cash advance within 10-14 days and have the money you need to upgrade your business, get new equipment or just maintain operation during a down time in the economy.

When opening a restaurant there is always the chance that you are going to need extra financing and always the chance that the bank is going to turn you down. This is when you need to look into alternative financing sources and other ways of obtaining the restaurant loan you need to get your business started, maintain your business or upgrade and expand.

Copyright@2008

Author: Edwin De Leon
Article Source: EzineArticles.com
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Restaurant financing was once very difficult to obtain but today there are many options for financing and restaurant loans are offered by various financial institutes as well as traditional banks.

There are many factors that will come into play when looking to obtain financing for your new restaurant. For example, the size of your restaurant, your experience, how much funding you are putting up, and how much funding you need.

Money makes the world go round and it definitely makes your restaurant go round. Whether you are opening your very first restaurant, moving your existing restaurant to a bigger location, remodeling, or adding new a new bar – it matters not, all of it entails restaurant financing, and restaurant loans are much different than regular business loans.

Restaurant loans can be challenging to obtain and frustrating for you. This just isn’t an industry that the banks like, so you need to be ready for rejection to occur. The good news is that there are loans available if you just persevere. Here are some tips to help you get that financing in place.

Explore

Explore various financing options. What works for someone else might not be right for you. So don’t be afraid to spend some time online to find the right loans for you.

Commercial Restaurant Loans

You may have trouble finding conventional restaurant loans, especially if this is a new venture without a proven track record, but it’s still worth a shot. The key is to be able to prove to the bank that you are really low risk. The banks job is to have assets to cover a percentage of the amount of money they lend, so take a little time to understand how this works.

SBA Loans

SBA loans are something that many aren’t familiar with. This is an alternative to the traditional restaurant loans offered by your bank. Through the private sector loans are granted through various lenders and the SBA will guarantee up to 85% of the principal. There are actually more than 500 lenders in Canada that offer SBA loans. If you are turned down on traditional restaurant loans, you may be a candidate for an SBA loan.

Investors

There are many individuals and companies that are interested in investing in new ventures including restaurants. Unlike restaurant loans investors own a portion of the business. You determine the agreement between you and the investor.

Seller Financing

If you are purchasing an existing restaurant many times the seller is willing to finance. Don’t be afraid to ask.

There you have it – restaurant loans are readily available, perhaps just not in the traditional form that we are so used to, but certainly in many other forms.

Author: Gordon Petten
Article Source: EzineArticles.com
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