Auto Shop Loans

Small Business Loans for Auto Repair Shops

There isn’t a one-size-fits-all model for auto shop loans. A small business loan expert can help you determine the best loan for your specific business, but here are some of the loans you might consider, depending on your auto repair shop’s needs. 

Business Term Loans

When you think “auto shop loan,” you’re likely thinking of a business term loan. A term loan can be used for a broad number of purposes. You receive a lump sum up front, which is then repaid with fixed payments spread out over the term of the loan. 

Equipment Loans

Fixing cars requires equipment. If you need to purchase or repair an auto lift, fabricating equipment, steel cabinets, or even computer equipment, you might want to consider an equipment loan. These specialized loans were specifically designed to finance the physical tools you need to run your business, often making them the best choice to finance the stuff you need in order to be successful. The best news? The equipment you purchase (or repair) acts as collateral for the loan, which means that this loan type may be available to borrowers with lower credit scores. 

Accounts Receivable Financing

Don’t let unpaid invoices kill your cash flow. With accounts receivable financing, you can borrow against outstanding invoices to access working capital when you need it. With this loan type, you essentially sell your unpaid invoices to a lender. In exchange, you can receive up to 80% of said receivable as soon as 72 hours after loan approval. 

Startup Loans

If you have a new auto shop, you may want to consider a startup loan. These loans are designed to help new small businesses get their feet off the ground. Lenders consider your personal credit score instead of business credit, so it’s no sweat if you haven’t been in business for years. 

Business Line of Credit

Flexible financing to meet your ever-changing needs. With a business line of credit, you can borrow as much as you need, up to the full loan amount, whenever you need it. You only pay interest on what you use, and you can borrow as many times as you like over the course of the loan.

ACH Loans

Small business capital that’s accessible in as little as 24 hours after funding. An ACH loan offers flexible financing that’s lighting fast. This loan type, which is often referred to as a “cash flow loan,” can be easier to qualify for than other business loans. 

How to Get the Most Out of Your Auto Shop Loan

The success you can leverage for your business with a loan depends on how well you use it. Here are some best practices for getting the biggest bang for your buck with an auto shop loan.

• Create a plan for success: Know how you’ll use the funds before you receive them. Do you already know what you need the loan for? If so, exactly how much do you need? When do you expect to receive a return on the investment? When can you comfortably repay? Answering these questions will help you determine the best loan product for your business. 
• Shop the market: Know which loan products are available to you and how the offers differ from lender to lender. When you use a lending marketplace, you can compare multiple offers (without having to put in the extra effort), and lenders compete for you. 
• Seek expert advice: Consult with a small business loan expert. They know the ins and outs of each loan, and they can help you weigh the pros and cons to determine the best loan for your business. 
• Make a repayment plan: Make a recurring calendar appointment to remind yourself of payments. Set up recurring payments, if possible. Taking these steps can help you repay with ease, ensuring that your new loan helps boost your business credit. 

Apply for an Auto Repair Shop Loan

Complete our 15-minute application to gain access to our network of 75+ lenders. Simply answer a handful of questions about your business, attach recent bank statements, and you’ll be on your way. We match you with a dedicated funding manager to share their small business expertise so you’re prepared to compare different loan offers and make the right choice for your auto shop.