How we can help
SBA loans can take months. If you already own an operating restaurant, we can fund equipment or a time-sensitive project now, while your SBA loan is in process.
Check if my restaurant qualifies →Key takeaways
- Restaurants and bars are eligible for SBA loans as long as the business and owners meet SBA standards.
- Franchise brands must be listed in the SBA Franchise Directory, which the SBA reinstated in 2025.
- Bars with video gaming should watch the rule that makes a business ineligible if more than one-third of gross revenue comes from legal gambling.
- SBA loans are slow. If you need money now, a short-term loan can bridge the gap.
Market overview
- Max loan
- $5 million (7(a)); larger projects with 504
- Terms
- Up to 10 yrs (equipment, working capital); 25 yrs (real estate)
- Down payment
- Often 10% for startups and acquisitions
- Time to close
- Typically 45–90 days
Typical market ranges, not offers.
SBA 7(a) vs. 504 for restaurants
| SBA 7(a) | SBA 504 | |
|---|---|---|
| Best for | Opening, buying, remodeling, equipment, working capital | Buying or building the restaurant's building; major equipment |
| Max SBA loan | $5 million | CDC portion typically up to $5 million |
| Down payment | Often 10% for startups and acquisitions | Often 10%; 15% for startups or special-purpose property |
| Terms | 10 yrs (equipment, working capital); 25 yrs (real estate) | 10, 20, or 25 years |
| Rate | Prime + capped spread (usually variable) | Fixed on the CDC portion |
| Covers goodwill (buying a restaurant)? | Yes | No |
Restaurant buildings are often appraised as special-purpose properties, which can mean a higher down payment under the 504 program. Ask your lender early.
Eligibility issues specific to restaurants and bars
- Franchises: Since SOP 50 10 8 took effect on June 1, 2025, franchise brands must appear in the SBA Franchise Directory for their franchisees to qualify. Check your brand before you sign a franchise agreement. See franchise financing.
- Gaming revenue: A business is ineligible if more than one-third of its gross annual revenue comes from legal gambling. Bars with video gaming terminals should run the numbers.
- Certain nightlife businesses: SBA rules exclude businesses that present live or recorded performances of a prurient sexual nature. Ordinary bars, breweries, and nightclubs aren't affected.
- Reported income: SBA lenders use tax returns. Unreported cash and tips won't count toward what you qualify for.
What an SBA loan can pay for
- Build-out and leasehold improvements: hoods, plumbing, electrical, finishes
- Kitchen and dining equipment
- Opening inventory and working capital
- Buying an existing restaurant (goodwill, equipment, inventory)
- Buying or building the restaurant's real estate
- Refinancing expensive business debt, when it meets SBA rules
Illustrative example: SBA 7(a) for a second location
An owner with a profitable first restaurant opens a second for a $830,000 total project: build-out, equipment, and working capital. With about 10% down, the SBA 7(a) is roughly $750,000. Over 10 years at an assumed 10.5%, the payment is about $10,120/month. The lender will look at both restaurants' cash flow together.
Hypothetical scenario for illustration. Numbers are rounded and are not a quote or offer.
Need money before your SBA loan closes?
SBA loans commonly take 45–90 days, sometimes longer. If you can't wait for a broken walk-in or a time-sensitive deal, a short-term business loan can bridge the gap, then be paid off when the SBA loan funds. Ask us about bridge funding.
Frequently asked questions
Can I get an SBA loan to open a restaurant?
Do SBA loans work for franchise restaurants?
Are bars eligible for SBA loans?
How long does an SBA restaurant loan take?
Sources
We cite primary sources: federal agencies, regulations, and official program rules. Rules vary by state and change over time.
General education, not legal, tax, or financial advice. Loan programs, licensing rules, and lender requirements change and vary by state. Disclosures.