- You can get a gas station loan to buy a new gas station, service station, or convenience store; make a current one bigger; or buy more gas stations.
- Gas station loans or a business line of credit can also help you pay for the day-to-day costs of running a gas station or convenience shop.
- Many gas station customers only pay with cash, so it might be hard to get a loan or find a lender if you don’t have proof of income.
What is a loan from a gas station?
Gas station loans are a type of debt that owners can take out to buy a new gas station or grow their current business. For example, you could use a gas station credit to get more cash flow to help pay for things like rent, payroll, or inventory.
Getting a loan for a gas station can come from a number of different places, like other types of business loans. What kind of loan you pick will depend on your goals, the history of your business, its credit, and a few other things.
How a business loan can help your gas station.
Running a gas station or convenience shop comes with a lot of costs. Any small business owner knows this. Loans can help you get the money you need to purchase or build a gas station. A gas station loan can also assist you in obtaining more working capital, or cash flow, to cover regular business expenses or unexpected costs.
Here are some examples of how a client might use their loan:
- Buying a gas station or grocery store from the start
- Buying commercial land to make the gas stop bigger
- Paying to make changes or improvements to the gas station.
- Purchasing land and tools to construct a new gas station
- Giving money to other business growth projects, like adding a car wash or other services
- Paying the bills
- Purchasing goods
- Taking care of bills
There are several types of gas station loans.
There are a number of small business loans that gas store owners may want to look into.
Businesses can get bank loans.
You might be able to secure a business loan for a gas station if you meet the eligibility requirements and the property type is suitable. You can use the money from commercial loans and small business loans for many things, such as buying a gas station or paying for the day-to-day costs of running a business. You can get a certain type of loan based on your business’s credit score and how well your finances are doing. The loan terms and how you pay it back will also be important.
Commercial real estate loans
A business property loan might be a good choice if you want to buy an existing gas station or build a new one. You can also use a real estate loan to sell your home and earn cash. With this choice, too, you will probably need a down payment.
Gas stations can get loans from the Small Business Administration.
The Small Business Administration (SBA) gives gas station owners a number of loan choices that are less rigid than a mortgage or real estate loan. Most of the time, SBA loans are easier to get than other types of loans, but there may be tighter requirements.
The SBA 7(a) loan is the most popular type of loan. It can be used to purchase equipment, acquire additional short- or long-term working capital, or settle business debt. But you have to have exhausted all of your other loan choices before you apply for this one.
A gas station owner can also get an SBA CDC/504 loan to buy or build land, new facilities, machinery and equipment, or current buildings. It can also improve the quality of houses, land, utilities, parking lots, and landscaping. Unlike the SBA 7(a) loan, you cannot use this loan for operating capital, inventory purchases, or debt repayment.
The USDA backs loans to businesses and industries.
The United States Department of Agriculture runs a scheme for people who want to open a business in the country, such as a gas station. Gas station owners who want to open a business in a town with fewer than 50,000 people can get one of these USDA Business and Industry (B&I) loans.
You can use a USDA B&I loan for the following purposes:
- The business’s growth
- Purchasing a home
- Getting machinery or equipment
- Buying goods and stock Refinancing debt to make money or hire more people
Collateral, typically from your gas station, is required for this loan. The USDA only allows certain companies to provide loans, and they will work out the interest rates directly with you.
Line of Credit for Business
A business line of credit could be a good way to get the money you need to buy tools, stock, or pay for day-to-day expenses. Like a business credit card, your line of credit lets you borrow any amount of money up to your limit. You only pay interest on the amount you borrow. Lines of credit may also be easier to get than standard business loans, which can be very helpful for the owner of a gas station.
How do I get a loan for a gas station?
What you need to do to get a gas station loan depends on the type of loan you want, but here are some things that all lenders will ask of you:
- I have both personal and business credit scores, as well as a background. This is by far the most important thing to think about when you want to borrow money. A bank or other financial institution will decide how risky it is to give you money based on your credit score.
- Your money. The bank will want to know how much money your business makes in order to determine if you can repay the loan. Again, you might not have a good paper trail to show this because a lot of people pay for things with cash at gas stations and convenience stores. Most likely, your tax returns will be the best way to show how much money you make each year.
- Ratio of debt to income. In order to figure out if you can pay back the new loan, the lender will want to know about your other bills.
- Things of value and security. A lender might ask you to put up collateral so that if you don’t pay back the loan, they have something they can sell to cover the loss. In this case, it could be your gas station, your tools, or even your home or money.
- Fees for starting up. You’ll likely need to pay the lender’s fees before they process your loan application, so you’ll need to have that money ready.
What do you need to do to get a loan for a gas station?
If you want to apply for a gas station loan, you should have the following ready:
- Income tax forms (personal and business)
- The bank sheet and income statement
- Maintaining bank records for both yourself and your business is crucial.
- Proof of identity (passport or driver’s license)
- A lease
- Licenses for business
- Forms of organization
- Your resume Any predictions about money
- Secured loans
- The type of loan you ask for may tell you what other paperwork you need to bring.
What types of lenders offer loans to fast food chains?
Apart from the loans already mentioned in this article, there are other lenders who give loans for gas stations, such as:
- Bank of America, Chase Capital One
- Goods + Bank
- Quickbridge Greenbox Capital CREFCOA RMC Funding
- There’s a chance you could get a gas station loan from a bank or other financial company if you already do personal or business banking with them.
Is it tough to get a loan for a gas station?
Unfortunately, because of how they work, traditional lenders may not be able to offer good financing choices for gas stations. There are, however, ways to get funding for a gas station if you do your research and work on improving your business credit score. Commercial Lending USA helps all kinds of small business owners understand what makes up a business’s credit score and gives them the tools they need to get the loans they are most likely to be able to get. Start right away by creating a new account.