Has your dream always been to have your own restaurant? If you’ve finally decided to establish yourself as a chef with your own restaurant, you may find it difficult to finance your business. This is because restaurants are often considered high-risk investments by banks. Restaurants are thought of as high-risk because of the stress that is put on the owners as running a restaurant is often a job that lasts far longer than the average working hours.
Because of this, banks see it as improbable for most new restaurants to turn a profit and pay them back for the loans they take out. Therefore, as a restaurant owner you may have to seek the financing for your restaurant elsewhere.
What financing options are there for your restaurant?
There are various loan options you can apply for when looking for financial assistance for your business. A hard money loan is one of those options. Hard money loans are a type of asset-based loan, meaning the loan is secured using assets in your possession such as a house. A hard money lender is typically a private company or investor.
A hard money lender is often sought out as an alternative source of financing because of the quick turn around hard money deals offer. The process only takes between seven to 14 days depending on the hard money lender. Additionally, hard money lenders may not require a fee upfront, application fee, or out-of-pocket capital, which saves you money during the process.
Hard money loan rates are typically structured in a way so that you will be able to repay the lender according to your income. This reduces the risk of financial difficulty on your end, which ultimately secures the lender’s repayment. Payments that are too high are often a burden to restaurant owners and can result in poor quality business and an unsuccessful outcome, which is why hard money lenders often base the repayment additionally on the restaurant’s revenue.
If you are considering investing in your dream of creating a restaurant business, but your bank doesn’t see the benefit in financing your decision, consider seeking the financial assistance of a hard money lender. Hard money loans offer good repayment plans and are quick to process, effectively helping your business become a successful reality.