Financing Gas Stations

Financing gas stations are complicated due to the single use nature of the property, environmental issues and subsequently the limited pool of banks and lenders that want to fund on this property type. Some lenders will simply not look at gas stations while others will be so conservative that it would save everyone time and effort if they just didn’t bother quoting on gas stations to begin with.

The most viable options for gas station financing include SBA loans and niche portfolio lenders that specialize in this building type.

The primary benefits of the SBA programs include low, long term fixed rates and the highest level of leverage in the industry. Borrower can expect to only put down 15% compared to conventional requirements at 40% down. In addition, the SBA, and especially the SBA 7a program has very flexible underwriting standards. For example, debt coverage ratios can be as low as 1.1 compared to 1.4 that required by most conventional sources.

Most people do not realize that they can refinance with an SBA programs. With the 504 that is true you cannot refinance with it. With the 7a you can. And it can be one of the best programs in the industry. Borrowers can consolidate business debt, pull cash out for renovations or expansion, etc.
One of the main criticisms of the 7a program is that it comes with a floating rate. However there are a few lenders do structure this as a 5 year fixed program that is amortized over 25 years.

Niche portfolio lenders that specialize in gas stations often have as many benefits as the SBA programs but in different ways. For example we work with a gas station lender out of Maryland that will consider not only the value of the real estate as collateral but also business value and equipment. They’ll go to 80% of the combined value. This can be really relevant if, for example, the value of your real estate has dropped, or if you currently have an SBA loan that is at max leverage.

In general due to the complexity of gas station financing it’s important to work with people that have experience in this industry.

Adverse Credit Debt Consolidation Loans – For Smoother Payments

If you continue to have high amount of old loans, then it simply implies that your monthly outgoings are burdensome on your limited finances. To counter such a situation, the people having multiple payment faults in their names, can go for adverse credit debt consolidation loans for immediately getting rid of the old payments. However, the new loan should be carefully taken to escape any other trap.

The new loan combines balance amounts on your unsecured loans and credit cards into easy monthly installments to the new lender. You can either pay off old loans yourself through the loan or the lender may be allowed to do the job. Immediately, you are out of the old loans, implying that the risk of missing the payments is eliminated. You also save money on interest payments, as the debt consolidation loan usually comes at lower interest rates.

People, who have tags like late payments, payment defaults, arrears and CCJs, can avail these loans in secured or unsecured options. The secured loan can pay off larger debts in the range of £5000 to £75000, depending on value of the property that is pledged for collateral. Such an amount is borrowed at lower rate of interest. The loan can be repaid in 5 to 30 years. The unsecured loan option comes without collateral, and is ideal for both tenants and homeowners to pay off smaller old loans in the range of £3000 to £25000. Such a loan comes at little higher rates. You can return the borrowed amount in short -term of 1 to 15 years.

On making the repayments of installments of the loan, your FICO-rating will improve, enabling you in taking loans at easier terms in the future. However, first apply for the rate quotes of the lenders, who are providing adverse credit debt consolidation loans. Compare the rates and additional charges on these loans in order to find a suitable deal. Surely these are helpful loans for getting rid of old burden.

How to Finance Your Home Renovations – Whether to Dip Into Savings Or Secure a Home Equity Loan

The reasons for undertaking home renovations are varied. Many homeowners want to modernize or update the look of their homes for their own comfort and enjoyment. Some, rightly, view their home as an investment and want to increase the resale value of their home should they decide to sell. In today’s environmentally-conscious times, many homeowners are now undertaking home renovations to increase the energy efficiency of a house. Their investment in home renovations converts into a smaller “carbon-footprint” and long-term savings in energy consumption and costs.

Whatever the reason, homeowners planning home renovations should consider both their costs and their financing options before beginning their project.

Options for Financing Home Renovations

As with any investment, the financing option you choose depends on the size of the project and your current financial situation. Financing options can range from dipping into your pocket or savings and paying cash for smaller projects such as painting and wallpapering, to tapping into a line of credit, taking out a line of credit or even refinancing a mortgage for larger renovations that can range from bathroom do-overs to adding additions to existing homes.

Here are some of the more common options for financing home renovations, both large and small:

Financing Minor Home Renovations

Self-Financing – This option makes sense for smaller projects. It is also a feasible option for do-it-yourselfers on a pay-as-you-go (or pay-as-you-build) plan.

Credit Cards – Charging large expenses to a credit card is an option, but not necessarily a good one. With their higher interest rates, credit cards have limited value in home renovation projects, and can be damaging to your financial health if there are unexpected cost overruns. (A do-it-yourself installation of a tub surround in your bathroom can turn expensive if your plumbing skills are not as honed as you would have liked them to be and you notice water dripping through your living room ceiling!)

Loans and Lines of Credit – These are popular options that offer interest rates substantially lower than those charged for credit cards, but often higher than those of home equity loans. One disadvantage of personal loans is that once they are repaid you need to reapply to obtain more funding. Lines of credit are ongoing, up to the credit limit, so there is no need to reapply if you need more funds. (A line of credit with room on it above and beyond the cost or the renovation will come in handy on a plumbing job gone bad – see above.)

Financing Major Home Renovations

Home Equity Loans – These loans allow you to leverage the equity in your home. They are often used to fund major renovations because they offer the needed capital at a much lower interest rate than credit cards or other types of loans. Typically a home equity loan, which can be structured as a line of credit secured against your home’s existing equity, is limited to 80% of your home’s value, but a mortgage broker can often work for you to secure loans of up to 95% of your home’s value. With home equity loans, there may be some setup costs, but like lines of credit, there is room to allow for cost overruns and unexpected expenses.

Mortgage Refinancing – If you are planning major renovations, like adding an addition or in-law suite, it may pay to refinance your mortgage. With this option you can spread the payments out over a longer period and enjoy mortgage rates that are normally much lower than those of credit cards, lines of credit or personal loans. As with home equity loans, there may be some initial fees to refinance.

New Purchases – If you are buying a new home that has already been built or is a resale, and know that you want to make improvements it will probably make sense to include anticipated renovation costs in your mortgage. A mortgage broker can help you shop around for the most favorable rate. If you are having your home built a mortgage broker can work with you to find a construction loan that fits your anticipated building schedule. You don’t want to be borrowing and paying interest on the entire project up front. A construction loan that allows you to draw down the cash that is need for each phase of your home’s construction as it is needed will have significant cost savings over the time it takes to build your dream home

Other Tips for Financing Home Renovations

Unfortunately, cost overruns are common with home renovations. When budgeting for your home renovation, be sure to leave a contingency fund for overruns or other unforeseen expenses. And as the project proceeds, you may discover that you want to add new items to the renovation, so having a little extra cash on hand is a good idea.

Consult the Experts When Financing Home Renovations

Always plan ahead and try to be accurate about the costs of your home renovations. If you are making major changes, a mortgage broker can help you decide on which home equity options are best for you.