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SBA 7(a) Loan Guaranty Program and SBA 504 Debenture Program for Convenience Stores

Getting Started or Expanding Your Own Convenience Store

If you're looking to establish your own convenience store or to purchase an existing one, we may be able to help you. Business Development Corporation (BDC), associated with Certified Development Corporation (CDC), offers SBA 7(a) and SBA 504 loans, allowing us to provide small business financing solutions that are customized to fit your specific needs, as we're more likely to look at higher risk loan situations more favorably.

Helping Small Businesses for Over 50 Years

Recently, we have simplified and streamlined our loan application and loan approval process; however, getting an SBA loan can still be challenging. That's why we are here every step of the way, as we've been providing SBA loans for over 50 years and have assisted numerous convenience stores with financing in the past several years.

Overview of BDC and CDC Loan Options

LOAN REQUIREMENTS

MAXIMUM AMOUNT OF LOAN

$5 million

MINIMUM AMOUNT OF LOAN

$100,000

AMOUNT FINANCED

Determined by assets' appraised value

TANGIBLE SSETS FINANCED

Furniture, fixtures, equipment and/or real estate

INTANGIBLE ASSETS FINANCED

Goodwill based on expected future cash flow, client base and business reputation

DOWNPAYMENT REQUIREMENTS

10-20% cash injection (or borrowed from outside sources)

REPAYMENT TERMS SBA 7(a)

Determined by loan purpose and collateral (maximum 20 years)

REPAYMENT TERMS SBA 504

10 years (equipment)
20 years (real estate)

INTEREST RATE

Fixed for entire term on SBA 504 and generally floating tied to prime on SBA 7(a)

TYPE OF ENTITIES

Owner occupied for-profit businesses

 

Items Needed When Submitting a Loan Application

In order to get started, you will need to provide the following:

  • Completed Loan Application form
  • Personal tax returns for the past 3 years on owner(s)
  • Existing Business: past 3 years of business tax returns
    Startup Business: 2 years' income and expense projections
  • Résumé outlining your education, business experience and your experience in the industry
  • 12-month cash flow analysis of the practice showing expected month-to-month cash flow and salary requirements of the owner(s)
  • Personal financial statement (must be joint with spouse if married, regardless of his/her ownership or involvement in the business)
    Note: personal credit reports will be obtained

Real Project Examples

EXAMPLE #1 – CONSTRUCT A NEW FACILITY TO RELOCATE FROM LEASED SPACE AND EXPAND (10 NEW JOBS CREATED)

 

PROJECT COSTS

LAND ACQUISITION

$218,000

CONSTRUCT NEW FACILITY

$756,000

EQUIPMENT

$37,000

ELIGIBLE SOFT COSTS

$89,000

TOTAL $1,100,000
PROJECT FUNDING PERCENTAGE OF COST COST
FIRST MORTGAGE – BANK 50% $550,000
504 DEBENTURE – CDC 40% $440,000
BORROWER EQUITY 10% $110,000

EXAMPLE #2 – PURCHASE AND RENOVATE EXISTING BUILDING TO RELOCATE AND EXPAND BUSINESS (9 NEW JOBS CREATED)

 

PROJECT COSTS

PURCHASE LAND AND BUILDING $500,000
RENOVATIONS $157,000
EQUIPMENT $35,000
TOTAL $692,000
PROJECT FUNDING PERCENTAGE OF COST COST
FIRST MORTGAGE – BANK 50% $346,000
504 DEBENTURE – CDC 40% $276,800
BORROWER EQUITY 10% $69,200
FUNDING FOR INELIGIBLE COSTS
INVENTORY $18,000
WORKING CAPITAL $97,000
TOTAL – BDC/SBA 7(a) $115,000