Convenience stores are a significant part of the American economy, producing a more than $200 billion in annual in-store sales. There are more than 150,000 convenience stores in the United States, and that number is likely to increase as the U.S. population continues to grow. PHD Financial is here to provide you with the financing you need for your store, or portfolio of stores.

Types of loans that may be used for convenience store financing include:

  • SBA Loans
  • USDA Loans
  • Conventional Loans
  • Hard Money or Bridge Loans

SBA Loans for Convenience Stores

The SBA 7(a) and SBA 504 loans are effective ways to purchase or refinance a convenience store property. With SBA loans, convenience store owners can purchase property, but they can also purchase equipment or fund working capital for convenience stores. These loans are much more versatile for business owners who need more than just property to jumpstart their business growth. While SBA financing has a lot of benefits, it also has more stringent requirements than some other types of loans, including increased credit score requirements.

Conventional Loans for Convenience Stores

If your planned acquisition has a high DSCR (Debt Service Coverage Ratio) and you have extensive experience operating a convenience store, you may qualify for a conventional bank business loan. Bank terms are not generally as favorable as SBA loans, but they are worth exploring.

Convenience Store Loan Terms

In general, convenience store loan terms include:

  • Loan Size: $500,000+
  • Loan Purpose: Loan can be used for property acquisition or refinancing, but cannot be used for business only-financing
  • Loan Term: 3, 5, 10 and 15-year fixed rate terms
  • Amortization: 15, 20, 25 and 30-year options
  • Leverage: 80% LTV allowance (subordinate debt allowed)
  • DSCR: 1.40 minimum DSCR
  • Credit Score Requirement: 660 minimum

If you are considering purchasing or building a convenience store, contact PHD Financial today to discuss your options- 561.508.7558.