How to Finance a Franchise: Simple Strategies to Start Your Kitchen Tune-Up Business

Opening a franchise is a major investment, and for many potential business owners, the cost can feel like a barrier to entry. That couldn’t be further from the truth! Nearly half of all prospective franchise owners expect they’ll need a loan, and it may even come from multiple lenders. 

Don’t let sticker shock stop you from pursuing your dreams. Wondering how to finance a franchise? Here’s what you need to know about franchise loan options for your Kitchen Tune-Up business. 

Franchise Financing 101

Just about any franchise you might consider has set minimum net worth and liquidity requirements. Though it’s becoming less common, some brands might also set a minimum credit score. Kitchen Tune-Up franchisees are required to have: 

• $200,000 net worth
• $81,930 liquidity
• $49,980 working capital

For more information, please see Kitchen Tune-Up's 2025 franchise disclosure document.

The idea of these requirements is not to discourage you; rather, it’s to ensure that you have the ability to meet your financial responsibilities to the franchisor and in your life outside of work. As long as you meet their requirements, your franchisor should be okay with you pursuing franchise loan options. 

If you’ve never applied for a business loan before, it’s natural that you might find it overwhelming. As a franchise owner, however, you won’t have to go through the process alone. Your franchisor has your success top of mind, and they’ll provide the guidance you need to secure funding and meet your goals. In addition to helping you identify suitable franchise loan options, they will also help you prepare for meetings with prospective lenders.

What Your Lender May Require

Not all loans are the same, as we’ll get into shortly. Depending on the kind of loan you’re pursuing, your lender may ask for different documents or information. In general, however, you can expect a lender to request the following:

• One year of personal bank statements
• Three most recent years of personal and business tax returns
• List of current accounts receivable
• Cash flow statement
• Projected balance sheets
• Employer Identification Number
• Franchise agreement
• Articles of incorporation
• Business plan
• Personal information, like your Social Security number and date of birth

You can expect to fill out a number of government forms if you are applying for a Small Business Administration (SBA) loan. 

Common Franchise Loan Options

The best way to finance a franchise will depend on several factors, and your franchisor will help you identify the right options. Here are some of the most common franchise loans for home services.

SBA Franchise Loans

SBA loans have grown quite popular among franchise owners recently. Because they’re guaranteed by the federal government, their repayment terms are often more favorable than you’ll find with commercial loans. Qualified veterans are eligible for an M5 loan, but most franchise owners will receive a Type 7(a) loan. It’s important to remember that SBA loans are tied directly to the Federal Reserve’s prime rate, which may cause the interest rate to run high.

Retirement Rollover

You can borrow from your retirement account, and some do, but we wouldn’t recommend it. In order to avoid penalties and taxes, you’ll have 60 days to restore the funds you’ve borrowed or roll them into another account. You cannot borrow from an IRA.

Home Equity Loan

Potential franchisees who own a home can pursue home equity loans or home equity line of credit (HELOC). Home equity loans, in a nutshell, provide you with a lump sum of cash at a fixed interest rate. Some borrowers prefer HELOCs instead, as they let you withdraw funds as needed. Though a HELOC’s smaller monthly payments may be appealing, they have a variable interest rate and the payments will increase over time.

How to Finance a Franchise with Kitchen Tune-Up

At Kitchen Tune-Up, we offer up to $48,000 in in-house financing to qualified candidates. We also have a list of trusted third-party lenders, and we’re happy to connect franchisees with them at any time during the franchise process. One of our most popular franchise loan options is financing with your 401(k). For qualified veterans, we’re proud to honor your service to our country with a 15% discount off the franchise fee.

Explore Your Franchise Loan Options with Kitchen Tune-Up

When you choose Kitchen Tune-Up, you’re not just investing in one of the best home improvement franchises; you’re partnering with an industry leader that truly cares about your success. Experience the difference our commitment to you can make. Inquire now, and one of our franchise advisors will reach out with more information.