With dual income households practically the norm today, more children than ever are going to daycare facilities. If you need financing to start a child daycare center; or you want to expand or refinance your current facility, PHD Financial can match you with the right loan product.

Day Care Center Loan Terms

In general, day care center 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, 7 and 10-year fixed rate terms
  • Amortization: 15, 20, 25 and 30-year options
  • Leverage: 65%- 75% LTV allowance
  • DSCR: 1.40 minimum DSCR
  • Credit Score Requirement: 660 minimum

SBA Loans for Day Care Centers

For many childcare center owners and operators, the SBA 7(a) or SBA 504 loan programs may be the most effective way to acquire commercial property. Unlike privately-insured loans, SBA loans allow daycare center owners to buy equipment and fund working capital. That makes these loans a lot more versatile for business owners who need more than just property to ignite business growth. While SBA financing has a lot of benefits, it also has stricter requirements than many other loans, including increased credit score requirements.