Restaurant Business Loans
Your main ingredient for success.
There’s a sense of fulfillment that comes with teaching and taking care of children. Their curiosity and appreciation of the world around them make running a daycare center a rewarding career. But just like any other business, you’ll need a significant amount of working capital to keep your facility running smoothly. Paying for insurance, utilities, hiring and training, child-proofing your space, and daily operational costs are expenses that can quickly add up.
Restaurant businesses operate in a highly competitive environment. Fast food chains, trendy coffee shops, and classic diners seem to pop up everywhere. Successful restaurants are constantly looking for ways to outdo the competition and establish a competitive advantage. However, it can be challenging to keep up with the trends (and maintain business operations) without access to a steady stream of capital.
Restaurant business loans are a great solution if you need additional working capital to bridge cash flow gaps, get through slow periods, or pay for day-to-day expenses.
Whatever you need, there’s a loan fit for your restaurant.
At 1West, the restaurant financing solutions we offer can be tailor-made to fit your business goals and objectives. Whether you need to purchase new equipment, hire more bartenders or waiters, renovate your restaurant, or just have extra capital on hand, our restaurant business loans can fund these initiatives.
The application and underwriting process only takes a day, and you’ll have the money in your bank account within 72 hours. We also work with business owners with low credit scores, so don’t hesitate to apply for financing!
Are You Ready to Take Out a Restaurant Business Loan?
Here are a Few Signs to Watch Out For!
You run a financially healthy business.
Most people only apply for financing when they need it the most. But contrary to popular belief, the best time to take out a business loan is when your business is financially healthy. It may seem off-putting to apply for financing when you don’t need it, but there’s a logic behind this.
Lenders need assurance that you’ll be able to repay your loan on time. Demonstrating a healthy cash flow lowers your risk level as a borrower, which means lenders will likely approve your application and give you the best rates and terms.
Your calculations make sense.
Taking out a restaurant loan is a financial risk, which is why it’s important to do what you can to minimize this risk. Calculate whether the amount you’re going to borrow makes sense financially. After initial calculations, you should be able to answer the following questions:
- Do you have a contingency plan if things go wrong?
- Will your cash flow for the next few years support loan repayments?
- Will you still be able to repay the loan even if your growth and expansion efforts wouldn’t go as planned?
- Does the loan make sense from an ROI perspective?
These are some of the questions you need to ask before applying for a restaurant business loan.
You have a fool-proof business plan.
Borrowing money without a concrete plan sets your business up for failure. It’s important to have a detailed plan on how much you need and how you will use the loan to grow your restaurant. A business plan is an invaluable tool when it comes to business loan applications. It shows lenders that you’re serious about growing your restaurant, and you understand the costs associated with borrowed capital. Your business plan should show financial projections outlining how much you need to grow your business.
Why Choose 1West?
Entrepreneurs created 1West for entrepreneurs because we understand the struggles small businesses face to secure funding, especially for restaurant owners.
Banks, credit unions, and other traditional lenders think that loaning money to restaurants is risky. These traditional lending companies ask for extensive requirements and paperwork to consider your application. This may include solid credit history, 20% to 30% down payment, and relevant hospitality experience, to name a few.
At 1West, we firmly believe that access to financing shouldn’t be complicated at all. We’ll help you get the funds you need to take your restaurant to the next level.
Here’s How to Apply
Create an account. Our fully-automated small business loan application only takes less than 15 minutes to complete. We may ask you to submit a document or two, but we make it easier for you to upload those documents securely.
Choose a loan. The next step is to choose the loan that best fits your needs. Compare loan offers from our network of 50+ lenders.
Apply for a loan. Our application process is fast, simple, and fully automated. You’ll only need to provide basic information, and our team will review your business performance as soon as possible. We understand that it can be hard to choose, given the number of options available. We’ll give you access to our product wizard to help you decide on the most suitable type of loan.
Get Funded in as Little as 24 Hours!
You can use the money from a restaurant business loan to fund the following initiatives:
- Start a new business
- Purchase or repair equipment
- Open another branch
- Renovate your restaurant
- Improve your restaurant’s interior design
- Adjust floor plans to accommodate more customers
- Fund day-to-day operational expenses
- Create a cash reserve to offset unexpected expenses
- Launch marketing and advertising campaigns
- Expand your menu or sell new products
Restaurant Business Loans to Fund Your Needs
Traditional lenders don’t often make it easy for restaurants to get approved for a loan. Even if you secure financing from banks, it will take weeks or months before the funds are deposited into your account.
Fortunately, qualifying for a loan from 1West is quick and easy, and we have several options in store for you.
Unsecured Business Loans
Unsecured business loans for restaurants are some of the best loans for business owners with a good credit rating. These loans require no collateral, so the lender generally takes on more risk than secured business loans. This is an excellent option for business owners without valuable assets but who have a good credit rating.
Pros:
- Borrowers won’t risk losing collateral.
- Quick application process.
Pros:
- Borrowers often need to have a good credit rating.
- Higher interest rates to offset lender’s risk.
Business Line of Credit
A business line of credit is a financing option that gives borrowers access to working capital as needed. The rates, terms, and credit limit are based on your business’s financial health, creditworthiness, and market value. Since its revolving, a business line of credit is structured like a credit card. This means you don’t have to reapply if you need additional funding. Your credit limit will return to its original value when you repay the money you’ve withdrawn, plus interest.
This can come in handy if you need to restock their shelves, hire more waiters, or purchase a point-of-sale system. Restaurateurs can also rely on a revolving business line of credit to borrow money for unforeseen expenses.
Pros:
- Only pay the money you’ve borrowed, plus interest, rather than the entire credit limit.
- You can continue to use the credit line, given that you don’t go over the limit.
Cons:
- Lower loan amounts compared to more traditional loan options.
Equipment Financing
Restaurants rely on heavy-duty kitchen equipment to serve their customers. When a valuable piece of equipment is broken, or you’re looking to upgrade, equipment financing can give you the working capital needed to get one. You don’t need collateral to secure equipment financing as the equipment you’re looking to lease or buy secures the loan.
There are two types of equipment financing: equipment leases and equipment loans. Equipment loans are structured just like a regular business term loan. Lenders give you a lump sum upfront to buy the equipment and you can repay the loan in fixed monthly installments. With an equipment lease, instead of borrowing money to purchase equipment, you can pay a monthly fee to use it until the end of their contract.
Pros:
- Enjoy low interest rates, longer repayment terms, and higher loan limits.
Cons:
- The underwriting process usually takes at least a month.
- A good credit rating and collateral may be required.
How to Compare and Evaluate Different Loan Options
With all these options available, which one is the best for your business?
Here are some of the factors you want to consider when comparing loans from different lenders:
- The total cost of the loan
- Repayment terms
- Speed of underwriting and funding process
- Lending company
You may also consider additional details, such as:
- Collateral
- Lender reputation
- Fixed or variable rate payments
Apply for Restaurant Financing with 1West
We understand that your business is unique, so at 1West, we make sure to provide the best financing suitable to your needs. We have more than 50 lending partners so you can compare rates, terms, and products.
Apply for a loan today!
Find out which lender and loan product best fits your needs at no obligation on your part.
Don’t worry; there’s no risk to your credit score.
1West analyzes your loan application to find the best match for you with our select lending partners. We’ve made our online application simple because access to financing doesn’t have to be complicated. We aim to improve your odds of securing a loan and unlock better opportunities for your restaurant.
We help you through the whole process.
You don’t have to go through it alone.
Call us anytime (888) 881-WEST
Monday – Friday | 9am – 6pm
FAQS (Frequently Asked Questions)
Can I Get a Restaurant Business Loan With Bad Credit?
Yes, it is still possible to get restaurant business loans even if you have a bad credit. However, it will likely be more difficult to qualify for financing and you may end up paying a higher interest rate or presenting an asset as collateral.
That being said, there are a number of lenders who are willing to work with borrowers who have bad credit. Take some time doing your research to find the best deal.
Do Restaurant Owners Qualify for SBA Loans?
Yes, restaurant owners qualify for SBA loans. The Small Business Administration offers various loan programs that can be used to finance a restaurant business. However, there are some requirements that you’ll need to meet in order to qualify. For example, you’ll need to have a good credit history and a solid business plan. You might also be required to provide collateral for the loan.
If you’re not sure whether you meet the requirements, it’s best to speak with an SBA-approved lender. They can help you determine if you’re eligible for their restaurant business loans.
Is it Hard to Get a Loan for a Restaurant?
Generally speaking, restaurant business loans can be difficult to obtain because lenders see the restaurant industry as high risk. The failure rate for restaurants is high, with many businesses going belly up within just a few years. As a result, restaurant owners often have to put up collateral just to secure a loan.
Additionally, restaurant loans typically have higher interest rates than other types of business loans. However, it is possible to get a restaurant loan if you have a strong business plan and are able to demonstrate your ability to repay the loan. Lenders also look more favorably on restaurant owners who have experience in the industry and a good credit history.