Commercial Loan Maturity Due in 2017

[hkim310]

So the loan on our business and property will reach maturity in April of 2017. Trying to get an idea of what institutions other operators are using for their business loan needs. So far I have reached out to Wells Fargo, Suntrust, Apple Credit Union....

 

[Car_Wash_Guy]

I used Wells Fargo on my wash. It was traumatic to say the least. Next time, I'd find a local bank

 

[wash4me]

Get off the internet and go introduce yourself to local banks. Bring 3 years tax returns and financials.

 

[robert roman]

Here is a great article on loans.

http://www.carwashmag.com/issues/cu...for-you/e84e2448b3d638f690f9f30534e5aeb5.html

I agree with the author.

What I find difficult for some operators is accepting the SBA loan fee which is generally much larger than conventional bank loan.

Downside of conventional like WF is lower LTV, non-negotiable interest rate, balloon payment.

 

[Earl Weiss]

Local banks are easier to deal with. You may ask others in your assn who they deal with.

 

[wash4me]

Paperwork is substantial on sba I have been told.

 

[rph9168]

The benefits of an SBA loan are pretty clearly stated in the article listed but they are usually harder to get and do require more paperwork. I agree that local banks are easier to work with and can usually go over the details of whether an SBA loan works for you or not. Leasing the equipment is also a viable option if it is new or not too old. Some accountants are well versed in the benefits of all available options and have no skin in the game so they might be more objective.

 

[hkim310]

Thanks for the all the replies! I actually contacted the author of that article as I had seen it in this months Auto Laundry magazine. He was very informative and gave me some good information. I have contacted some banks as well and I am in the infancy stages of compiling the required information. Have any of you written a formal business plan? Care to share...?

 

[wash4me]

Thanks for the all the replies! I actually contacted the author of that article as I had seen it in this months Auto Laundry magazine. He was very informative and gave me some good information. I have contacted some banks as well and I am in the infancy stages of compiling the required information. Have any of you written a formal business plan? Care to share...?

Please do let us know how it goes. My accountant can print those reports out of quickbooks then print tax returns at the same time in just a few minutes and also they look to see if anything is out of line before submitting to the bank.

 

[robert roman]

“Have any of you written a formal business plan? Care to share...?”

I've probably written over 100 business plans.

However, most people don’t “write” business plans anymore because software is available to fill-in-the-blanks, no math required.

http://www.carwashplan.com/business_plan

http://www.carwashplan.com/marketing_plan

Usually, the former is required for start-up, the latter for refinance.

Live on-line planning is also available.

http://www.carwashplan.com/_live__on_line_planning

 

[parsonii]

im very happy with the wells fargo sba i got. 2.25 mil, 25 years locked in at 4.65. the paper work and hassle is worth it. there were reams and reams of stuff they wanted including a phase 2 on secondary collateral if you can imagine that

 

[Car_Wash_Guy]

im very happy with the wells fargo sba i got. 2.25 mil, 25 years locked in at 4.65. the paper work and hassle is worth it. there were reams and reams of stuff they wanted including a phase 2 on secondary collateral if you can imagine that

Did you collateralize another wash?

 

[parsonii]

no i collateralized raw land and then ground leased it for the entire 25 years of my loan --- i made it perform twice

 

[hkim310]

Wow that's awesome Parsonii! Do you mind if I ask, was the loan for a refinance or the purchase/start of a new business? What was the main reason you chose to do SBA versus a traditional business loan? I definitely like the fact that you were able to get such a long term for a fixed rate! For us, that seems to be the greatest benefit of going with an SBA backed loan. The downside of course, is the boat loads of additional paperwork requirements that are needed. I am working through creating my Business Plan right now. I plan on trying to go both routes(SBA and traditional business loan) to see which would is better for us.

 

[parsonii]

it was for a new purchase but a refinance will be easier because they'll have your history of payments. it's a no brainer in this interest rate environment: get an sba and get the right wells fargo loan initiator to start the process. they get commission on the origination and if you find someone super motivated to make 10-20k they'll make sure all the paper work is done and done correctly. do the paperwork and saying it's a downside isn't even a valid reason. interest rates are going up and you won't get sub 5 any more but sub six is doable.

 

[JMMUSTANG]

I thought the SBA loans were a 10-40-50% split.
Customer comes up with 10% of the total loan amount plus fees.
SBA covers 40% of loan.
Bank covers 50%.
Parsonii is this what you got or is there another type of SBA loan that covers everything?

 

[GCAS]

Try the Bancorp Bank. I just closed on my SBA loan in Sept 2015. They were super easy to work with, organized, and very responsive. All they do is SBA lending. They are a preferred lender by the SBA so they don't need SBA approval. This saves a lot of time since they can handle all of the paperwork and underwriting in-house. Inbox me and I can forward you my loan officer contact info if you like.

 

[JMMUSTANG]

GCAS off subject but did you install the Dry N' Shine?
If so how's it working?

 

[GCAS]

GCAS off subject but did you install the Dry N' Shine?
If so how's it working?

JMMUSTANG the tunnel is currently under construction. I did decide to go with the Dry N' Shine. Will let you know in March when it is complete. Are you thinking about getting one?

 

[parsonii]

I thought the SBA loans were a 10-40-50% split.
Customer comes up with 10% of the total loan amount plus fees.
SBA covers 40% of loan.
Bank covers 50%.
Parsonii is this what you got or is there another type of SBA loan that covers everything?

this is directly from my wells fargo sba banker. hope it helps


The loan we did for you was a 7(a) loan. The other SBA loan option is a 504 loan. The main differences between the two loans is that the 7(a) loan is one loan coming from Wells Fargo Bank and we get a 75% guarantee from the SBA on the loan amount. Also, the 7(a) loan can be used to finance all aspects of the loan proceeds (i.e. Real-estate, equipment, inventory, working capital, etc.)

The 504 loan is two separate loans. Part of the loan proceeds come from the bank (50%) and the remaining part of the loan is with a CDC Debenture which is the SBA portion of the loan. With a 504 loan you would have two separate loan payments to pay each monthly and the loan proceeds for this loan is restricted to on real-estate or equipment. Inventory, working capital, etc. is not eligible to be refinance under the 504 loan. Also there is only a 3 year pre-payment penalty on a 7(a) loan vs. a 10 year pre-payment penalty on a 504 loan.