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Restaurant financing has always been a need best suited to certain financial companies that are well-versed in understanding the type of risk profile a restaurant loan represents. However the economy has completely changed this landscape, and many restaurants are now on a “black list” with business lenders to the downturn and retail slump. If you are a business owner looking for financing, there are a three things you need to know.

• Equipment Loans- This type of loan is available through various commercial loan brokers and some commercial mortgage companies and allows a loan to be made against your existing equipment that you may own as a part of doing business such as kitchen equipment, furniture, etc. Remember though, a lien will be placed against this property until the loan is paid off.
• Commercial Mortgage-If you own the building that you currently do business out of this may be a good option for you, especially if the balance on your existing mortgage is low, or the building is free and clear. Even with tough credit, you may be able to get a substantial loan against the property at fairly reasonable rates, especially compared to other available sources.
• Merchant Cash Advance- This “advance” is pitched primarily to restaurant owners and is secured against their future credit card receipts, even if credit is difficult. The advantage here is that normally this type of “cash advance” can be funded quickly, usually within 7 days. The disadvantages are many, including high factor, or interest rates, high fees and the requirement to change merchant credit card processors as a condition of receiving the loan. Because it is an “advance” against receivables and not technically a loan, regulations may allow rates as high as 50% or more on a short term basis.
• Credit Card Receivable Financing – This is also a quick funding, low documentation loan with factor rates that are 50-80% less than a merchant cash advance with no upfront fees or requirements to switch processors. Because it is a true loan and not an advance, a business will not be subjected to rates that are higher than state usury laws allow. Loan amounts are up to $500,000, even with credit scores as low as 550.

There are options out there for restaurant financing, and some of them can be relatively affordable. The best option is always going to be your local SBA backed loan. However, the reality of today’s environment is that not many of these types of low-rate government backed loans are actually getting approved. That is why it is important to carefully consider your options before moving forward.

Author: Neal Coxworth
Article Source: EzineArticles.com
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Up until recently restaurant financing, was burdensome and very limiting. Not only are there only a few lenders interested in restaurant financing, refinancing for this type of business is very difficult to obtain. If you are already in the restaurant business or are planning to open a restaurant, you really do have only a handful of lenders to choose from and even they remain overly cautious with very conservative guidelines.

Thankfully, in the past few years there have been a few more lenders decide to offer restaurant financing, and a few more options. For example, no you can look at stated income loans or loans that are amortized over 30 years. The main reason for the conservative lending patterns is that the restaurant industry has almost twice as many bankruptcies as any other industry. Plus this industry has a lot of seller financing which makes it riskier and more complicated for financial institutes.

When a restaurant loan is underwritten, it focuses more on the debt coverage ratios, loan to value ratios, your credit worthiness, and other more traditional requirements. The debt coverage ratio is the most important and is usually quite conservative around 1:1.3 meaning that for every $1.30 of net income the mortgage payment can’t be over $1.00.

Stated income loans are relatively new for restaurant financing, and they’ve come to be because of the cash nature of the restaurant business. It’s an excellent option for you if your net income isn’t enough for a traditional loan.

The restrictions on most loan to value ratios usually tops out at 60% except in some high leverage loans where it might be as high as 90%. All of these numbers really are dependent on both the lender and your personal situation. Restaurant financing is one type of lending that doesn’t have a cut and dry set of requirements. Your personal credit score will almost always come into play with restaurant financing, with a credit score of 640 being about the lowest credit score that lenders will look at.

Restaurant financing may be a little more difficult than other types of business financing, but you should never let that stand in your way. Online lenders are much more flexible than traditional lending institutes like the banks, so do your research, and explore all your options.

Above all, never give up on your dreams. If owning a restaurant is your dream, then keep at it until you find restaurant financing that works for you!

Author: Gordon Petten
Article Source: EzineArticles.com
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There are still viable options for restaurant financing in the market today. Borrowers however should realize and accept that the choices have become more limited, than they where just 6 months ago. For example, most conventional and or conduit type loans for restaurants are now gone.

Instead, borrowers should be focused on portfolio lenders, i.e. banks or lenders that hold the debt on their balance sheet. This is the opposite of what we have seen in the last decade as most restaurant lenders packaged and sold their loans off onto the secondary market and thus rid themselves of the loan in exchange for a split.

Portfolio lenders can be difficult to find though. And they don’t really advertise themselves as such. Borrowers should be prepared to call many banks to find sources that are set up as portfolio lenders and that are willing to consider a special purpose property like a restaurant. Many banks are shying away from this building type. We’re occasional are asked why.

The reason boils down to the difficulty in recollecting the bank’s capital in case of borrower default. When a borrower defaults on a loan, the bank has to go through the foreclosure process, than they have to sell the property on the open market to recoup their capital. Because the building itself was designed as a restaurant it cannot adequately be used for anything other than a restaurant – thus limiting their pool of potential buyers, making it harder to sell.

As far as terms, restaurant loans are almost all now quarterly adjustable. However rates are very strong due to Prime being as low as it is (currently at 4%). We are seeing most restaurant loans in the 6%’s now. Via government sponsored loan programs borrowers can still expect 85% financing on purchases and up to 85% on refinance transactions.

Author: Jeff Rauth
Article Source: EzineArticles.com
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The restaurants in Leeds is a very important part of any restaurant as it lets the patrons know what you have to offer in the restaurant and its rates. On taking a look at the restaurant’s menu, patrons will know what type of a cuisine you serve, and thus, the menu is something that should not be written in a hurry. As it can be considered to be an advertising or marketing tool, lots of thought and consideration has to be put into writing a restaurant menu.

The restaurants in Leeds consists of three important parts, its description, format and prices. Though the description is what helps a customer know about the type of dishes you have to offer, it has to be short and sweet as not many people are patient to read through long descriptions.

At the same time, the description shouldn’t be monotonous, but interesting enough to make the customer’s mouth water. You could include the dish’s major ingredients and use ethnic names for befitting dishes to make the menu more authentic.

Avoid using technical jargon

Don’t add too much of technical jargon in the menu as not all patrons will be able to read, and understand all this. Never mention numbers in your menu as it only makes it difficult for you to make adjustments in your portions.

At times, you may have to serve fewer pieces than you usually do; and if you mention the number of pieces in the menu, doing this will only make the customer feel that you have cheated on them.

Regarding the format of the restaurants in Leeds, the most important thing to note is that the colours you use in it has to match your restaurant concept and location. Like if you have a Mexican, French or Italian restaurant, preferable colours for the menu are vibrant colours like purple, red, turquoise and green.

Even the font you use in the menu should match your restaurant concept. Whilst classic script fonts are great for a French restaurants in Leeds, if you have a sports bar or any similar casual restaurant, it is better to use a less formal font. No matter which font you use, make sure they are readable, and not too difficult to read.

How to price your restaurant menu

The pricing of your restaurant menu should be dependent on food cost and production control. Whilst you should earn a profit in your dishes, your prices should not be much more than the local market prices. In addition to this, you can earn a profit in your menu by striking a balance between cheap and expensive dishes.

Besides your regular menu, you could create special restaurant menus on holidays and festivals. These menus commemorate the holiday or festival, and let you introduce new items to the menu.

Whilst designing your menu, make sure you don’t add any clip art to it as it only makes the menu look unprofessional, and that it was made on your home computer. Instead, use the help of a graphic designer to create pictures that make your restaurant menu look special.

For more information and resource on starting and running a restaurant, please visit http://www.yorkshirefoodguide.co.uk

Article Source:http://www.articlesbase.com/restaurant-reviews-articles/tips-for-writing-a-restaurant-menu-1372141.html