Bar Loans and Bar Financing

What bar owners finance

• Remodels and build-outs: new bar tops, lighting, sound, patios, rooftop decks
• Draft beer systems, glycol chillers, ice machines, back-bar coolers, glass washers
• Kitchen additions to grow food sales
• Liquor license purchases or upgrades, often as part of buying a bar
• Working capital for slow seasons, staffing, and events
• Buying an existing bar or opening a second location

Financing options for bars

What makes bar financing different

The liquor license

Whether you're opening or buying, your state and local alcohol authority has to approve the license, and lenders won't close until it's in place. In states that cap the number of licenses, a license can cost far more than the fixtures, and some states don't allow a license to be pledged as loan collateral. Lenders then rely on your cash flow, other assets, and personal guarantee.

Cash and reported income

Bars handle a lot of cash. Lenders qualify you on what's in your tax returns and bank deposits, so unreported cash doesn't help you borrow, and buyers shouldn't pay for it when purchasing a bar.

Gaming

If your bar has video gaming terminals, SBA rules make the business ineligible if more than one-third of gross annual revenue comes from legal gambling. Other lenders may have their own limits.

Buying a bar vs. opening a new one

Buying an existing bar gives a lender something to underwrite: tax returns, bank deposits, and a license already in place (subject to transfer approval). Most purchases are financed with an SBA 7(a) loan or a bank loan plus a seller note. Verify reported sales against bank deposits and distributor purchases; you should only pay for income the books support. See loans to buy a restaurant or bar.

Opening a new bar means financing the build-out, bar equipment, opening inventory, and license with no sales history. Lenders lean on your hospitality experience, your equity in the deal, and a detailed plan. Our business plan template works for bars: replace covers with drinks per hour and average ticket.

What lenders need for bar loans

• Business bank statements (3–6 months for operating bars)
• Business and personal tax returns for larger loans
• Liquor license status, or a timeline and approval plan for new licenses
• Lease with a remaining term that covers the loan
• Breakdown of food, beverage, and any gaming revenue
• Quotes for equipment and build-out work

For our core program, operating bars and taverns open at least 30 days under your ownership, with about $17,000+ in monthly sales and a credit score around 575 or higher, can check their numbers with no credit impact. See what your bar qualifies for.

Bar financing options in detail

SBA 7(a)

Longest terms and often the lowest rates, which makes it the usual choice for buying a bar or a major build-out. Expect a detailed application, an equity injection, and weeks to months to close.

Short-term business loan

Fixed payments over months rather than years, funded in days for operating bars with steady deposits. Good for remodels, a new draft system, or a busy-season stock-up.

Equipment financing

Secured by the equipment: draft and glycol systems, ice machines, back-bar coolers, kitchen equipment for a food program.

Line of credit

Draw for slow months, events, and payroll timing, then repay and draw again.

Plan around your busy and slow seasons

Bars near stadiums, campuses, or tourist areas can see big swings. Time remodels for your slow season, stock up ahead of peak weekends, and pick a payment you can cover in your slowest month, not your best one.

General education, not legal, tax, or financial advice. Loan programs, licensing rules, and lender requirements change and vary by state. Disclosures.