Business Loans for Auto Shops

Best Types of Business Loans for Auto Repair Shops

Overall, auto repair shops can get a lot of value from Canada Small Business Financing Program (CSBFP) loans. That’s because CSBFP loans come with limits on their interest rates. The Government of Canada shares the risk with these lenders and sees to it that borrowers get reasonable rates.

Not every kind of business or purchase can be supported by the CSBFP. However, many purchases an auto shop would make can be financed. Particularly useful options include building and equipment purchases or improvements.

When it comes to the actual types of loans suited to auto shops, there are a few options.

How do you Apply for a Small Business Loan for an Auto Repair Shop?

The first step for any business loan will always be choosing your lender. You should choose your lender based on the kind of financing you need. Then, choose the lender that offers you the best deal you can find with your business experience and credit score.

Auto shop loans typically require:

· A credit report
· Applicable licensing
· Business financial statements
· Whatever documents a lender asks for

Auto Repair Store Loans FAQ

How long does it take to get a loan for an auto repair store?

This depends on where you get your loan. Banks will typically take anywhere from ten days to a couple of months to approve your loan. Online lenders are usually much faster, taking anywhere from one day to a couple of weeks.

Can I get a business loan for an auto repair shop with bad credit?

Yes, you can. There are business lenders that offer bad credit loans to any business borrowers with low credit scores. Then, there are other lenders who provide loans to business owners with a wide range of credit scores.

In any case, you can expect to be rejected by many lenders if you have bad credit. You can also expect worse terms and interest rates on any loans you take out. However, you will almost always have access to at least a few business loans.

How big of a business loan can I get for an auto shop?

CSBFP loans can grant you up to $1,000,000. You will find similar limits from many business lenders. However, the amount any lender will give you will depend on their assessment of your business. If your business is large and profitable, lenders will likely be more willing to offer you a larger loan. Alternative and online business lenders typically would lend no more than 500,000. The loan sizes are typically between 40,000 and 150,000.