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It takes time and money to open a new car repair company, and most business owners need to borrow money to get started. During the crisis, lenders witnessed a decrease in the car repair business, but as we reach the 20s, it seems that the industry has rebounded and even expanded.
By 2020, the worldwide automotive aftermarket is expected to be worth $722.8 billion. Independent car repair businesses provide 75 percent of aftermarket vehicle repair, according to lenders.
As a small company owner, one option to take advantage of this steady time is to get a government-backed commercial real estate loan. SBA 7(a) loans of above $150,000 and up to $5 million are guaranteed up to 75% by the Small Business Administration (SBA).
The SBA 7(a) may be used for almost any legal business purpose (including plans for your car repair shop):
A new car repair facility is being built
The SBA 7(a) may cover any of the expenses connected with new construction, including hydraulics, bay doors, sprinkler systems, alarms and security, and so on.
Refinancing a mechanic’s shop
The SBA 7(a) funding may be utilized to refinance an existing loan. The loan may only be utilized in this manner if certain criteria are met. Check out our website on Debt Refinancing for additional details.
Purchasing an existing structure
Another typical use of the SBA 7 is to buy an existing car repair shop (a).
THE SBA 504 LOAN PROGRAM MAY ALSO BE OF USE TO AUTO REPAIR STORES
The Small Business Administration offers a variety of lending alternatives, including the SBA 7(a) loan. Auto repair businesses may discover that another SBA loan, such as the SBA 504 loan, is a better match for their requirements in many instances. SBA 504 loans offer lower down payments and interest rates than other types of loans. They cannot, however, be used to finance working capital and can only be used to fund commercial real estate, heavy equipment, and other fixed assets.