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SBA Express Loans for Preschools and Daycare Centers

In 2017, the preschool and daycare industry took in nearly $50 billion in revenue across the U.S., employing more than 1.6 million workers. Plus, the daycare industry is expected to keep growing in the next few years, making it an excellent time for new business owners to get into the market. So, if you’re interested in starting, expanding, or refinancing a preschool or daycare center, an SBA Express Loan could be a great way to do it.

Using SBA Loans for Preschools and Daycare Centers

Much like their larger sibling, the SBA 7(a) loan, SBA Express loans can be used for a variety of purposes, including funding working capital, purchasing equipment, and purchasing owner-occupied commercial real estate.

In particular, preschools and daycare center owners can use SBA Express loans to:

  • Build a new preschool or daycare center. SBA Express loans can cover nearly all expenses associated with construction, including security systems, safety equipment, and even furniture.

  • Buy out a partner: If you’ve started a daycare center or preschool with a business partner, and they want to retire or move on to a different industry, an SBA Express loan could be a fast and efficient way to buy their stake in the business.

  • Refinancing business debt: If you have SBA-eligible business debt (i.e., a business loan that was used for legitimate business purposes), that is currently being offered to you on unreasonable terms, you may be able to refinance it with an SBA Express loan.

  • Purchasing an existing preschool or daycare: If you want to purchase an existing preschool or daycare business, you can do so with an SBA Express loan. You can also use it to purchase an existing structure and upgrade/modify it to better fit your business.

Other SBA Loan Options for Preschools and Daycare Centers

SBA Express loans are one of the fastest ways for a business to get SBA financing, but they’re not the only game in town. Smaller preschools or daycare centers may want to opt for an SBA microloan, which offers amounts of up to $50,000 and has significantly relaxed credit score requirements. In comparison, larger preschools or daycare centers may want to look to the SBA 7(a) loan, which offers amounts up to $5 million, or even the SBA 504 loan, which has a maximum loan amount of $5.5 million and is intended only for the purchase or construction of owner-occupied commercial real estate.