Top 5 Options To Buy Franchises With No Moneyṣ

There this saying – ‘a dream is a story, often different from reality, which fits perfectly well when it comes to setting up a business. The idea of starting your own venture sounds exciting until you find out what truly goes behind making a business successful. And trust me, it is anything but as easy as they show us in movies.

From a genius business plan to a generous amount of financing – it takes a lot to establish a business from scratch. But thanks to these famous franchises, for they have made setting up a business pretty easy.

After all, a franchise doesn’t require you to start the business from scratch. And since the business is already established, it is a goldmine for those who wish to make huge profits! No wonder why, in the US, around 5.3% of small businesses are franchises!

However, buying a franchise is an expensive deal, which is why most people opt out. But how about we say you can buy one without any money? Tempted? Well, here’s how you can do it:

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   Franchisor financing has got your back

No money? Don’t worry – the franchisor financing scheme has got your back! Honestly, the best part about buying a franchise is that financing comes simply to you – sometimes, as easily as this.

Well, most of the huge franchises like the UPS Store are already aware that some franchisees may be running short of funds.

So that’s how the idea of franchisor financing bloomed, where the franchisor provides the required capital to the new franchisee so that he can start the business and the franchise keeps flourishing too. What a win-win deal, right?

2. Rollovers for Business Startups (ROBS) is a good idea

So, you have already retired but want to use your retirement fund for buying and running a franchise? That’s a wonderful idea, wholly supported by the Rollovers for Business Startups (ROBS) scheme.

Yes, we know, getting the retirement fund is a whole fuss. But chill, under ROBS, you can get access to the retirement money easily and can use that for buying cool and profitable franchises like Xtend-Barre Franchise.

But here’s a catch you must remember – in order to qualify for a ROBS scheme, you need to either have an IRA account or a 401(k) or a 403(b).

3. Home equity loans can help you too

Yeah, we know – the name does not justify this, but Home Equity Loans can also be used to buy franchises without money. You can use your home as collateral for buying the franchise you’ve been eyeing for long. But there are two catches here.

Firstly, you must have an equity amount for your home loan, which means some amount of the loan must be paid for it to work as equity for you. Secondly, banks do not allow the whole equity amount to be used as a loan.

In a nutshell, suppose if you have $300000 as equity for a home loan, banks will allow a maximum of 80% of the amount to be reused as a loan.

4. Small Business Administration (SBA) loans work great

This one is a treat from the government, especially for the potential franchisees. SBAs are government-held institutions that guarantee loans from banks at a reasonably low rate of interest.

In fact, this is the best option for those franchisees who do not have a decent credit score. But alas, like all good things, SBAs have their fair share of drawbacks too.

While it is true that getting a loan from an SBA for a business is easy, it is also one awfully time-consuming process. If that isn’t too bothersome, then SBA should do the work for you.

5. Why not go for a partnership?

Lastly, one genius way of buying a franchise without having to worry about financing is going for a partnership. And trust me, this is the easiest and the most effortless way of getting a franchise. Bringing a partner on board always makes hunting for the funds easy.

Besides, this will even help you in business operations later. But yes – this also means that you will have to choose your business partner really carefully, as he/she will also have partial control over the business operations.

Over to you…

Franchises may be all things profitable, but getting hold of one is not as easy as it requires one to burn an actual hole in the pocket. But now, you can also do that without zero investment of your own. Here, we listed 5 options to buy a franchise without money. This guide is a must-read.