Gas Station
Gas Station
Gas Station Loans - SBA Financing Just Became A Little More Tolerable
Over the years, SBA financing has been a staple of financing for dealers and operators. As the economy has worsened over the past few years, the petroleum retail industry has gotten even worse. With the fluctuation in fuel prices and our failing economy, foreclosures on gas stations and convenience stores have been at record highs.
Recently, the SBA had made financing for gas stations and conveniences virtually prohibitive. The SBA had required all stations older than five years to have a Phase II environmental and all transactions required a seller indemnification, regardless if there had ever been an environmental issue or not.
To add insult to injury, the SBA also required a separate business valuation from an independent company in addition to the appraisal.
Can we say "we really don’t want to do gas stations?"
It should come as no surprise that the SBA adopted this posture. With high profile fraud cases from some non-bank lenders in the past few years, record default and foreclosures, it is no wonder they made them difficult at the least to obtain financing. In reality, the petroleum retail asset class was not significantly worse than other asset classes.
With the disappearance of a viable secondary market, most lenders have either ceased doing SBA loans or significantly cut back the amount of SBA financing they would do. Only the larger banks could lend and portfolio their loans.
Fortunately with the stimulus package in 2009, much, although not all, of these conditions have changed. First, the SBA will no longer required indemnification agreements on all transactions except those where environmental conditions exists and an open file exists with the State.
Secondly, the SBA will no longer require a Phase II environmental except in cases where environmental conditions exists and an open file exists with the State.
One can check through the State's DEP or DEQ to make sure that there is not an open file (meaning there has been leakage, spillage or migration reported) so that the chance of decline will be reduced significantly.
In addition, the SBA is now allowing lenders to base their loans off of LIBOR as well as Prime, giving the banks more options to make the loans more profitable.
With the streamlining of SBA operations out of Sacramento, California, SBA financing is still a legitimate source of financing. As usual, having a well put together package is part of the battle.
In 2009, temporary changes that will last to the end of 2009 are the waving of the SBA guarantee fee (which can be substantial) and the guarantee percentage will increase to 90%. This should give banks incentive to make capital available again.
Regardless of what type of financing you choose, make sure that when applying for gas station loans, you deal with people that specialize in this asset class and know both the lending and petroleum industries.
About the Author
Harold Jaynes is with PetroMAC, the premier source for financing gas stations, convenience stores and truck stops. Come deal with the pros that have closed hundreds of millions of dollars in this asset class. Visit our site at http://petromac.com to learn more.
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HO RDA BUILDING CLYDES STATION STRUCTURE HOn3 HOn30 |  |
0 Bid | US $34.95 | 1h 20m |
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MTH 30 9113 CITGO OPERATING GAS STATION MINT IN BOX NO RESERVE | |
20 Bids | US $91.00 | 3h 48m |
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3 PLASTICVILLE OS GAUGE GAS STATION SURBURBAN STATION HO GAUGE SCHOOL | |
1 Bid | US $19.99 | 4h 17m |
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Marklin BR 210 Diesel Locomotive Sound MFX Soft Sine 39189 | |
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Ho Scale Phillips 66 Gas And Sevice Station | |
1 Bid | US $19.99 | 7h 28m |
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Vintage Lionel Trainset Lot of Accessories For Sale | |
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US $34.99 | 8h 23m |
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AUTOMOBILE TIRES SET OF 10 143 Scale for O O27 Gauge Railroads | |
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Walthers Cornerstone Interstate Fuel Oil Gas Station Kit HO Scale NIB | |
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Model Power lighted gas station signs Gulf | |
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1930s 1950s CIGAR VENDING MACHINES 4 Pack of these classic machines in O | |
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N SCALE SHELL GAS STATION | |
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VINTAGE PLASTICVILLE GAS STATION BOXED 1950s | |
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MTH 30 9106 Esso Gas Station Instructions Owners Manual | |
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50s RARE 027 S O PLASTICVILLE LG GAS STATIONOB 2CARS | |
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Z scale scratch built FULL SERVICE TEXACO STATION | |
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Lionel RK Esso station AMAZING ANIMATION SOUND sealed box read description | |
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AUTOMOBILE TIRES 1950`s SERVICE STATION MERCHANDISING KIT set of 12 | |
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AUTOMOBILE TIRES 1950`s set of 8 White Wall Tires W Hub Caps 143 scale | |
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HO SCALE Vending Machines SODA POP 4OA | |
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2 HO SCALE MODEL RAILROAD TRAIN SLOT CAR SCENERY EXXON GAS STATION LIGHT UP SIGN | |
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Plasticville GAS STATION GO 2 Vintage 52 53 Original Owner | |
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Bachmann Plasticville Gas Station Kit 45174 HO Scale in original sealed box | |
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1946 20 MODEL train RAILROAD PROJECTS Book Frank Taylor useful book | |
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N Scale ERNIES GAS STATION Kit Blair Line | |
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