Why should I do business with GE?
Why should I consider Franchise Finance?
What types of financing do you offer?
What franchise concepts qualify for financing?
What loan amounts do you offer for financing franchises?
Do you offer advances?
How long is the application process?
How does GE differ from a bank?
How does GE price loans?
What are your interest rates?
How do commercial lenders earn a fair profit?
What is a "portfolio lender"?
What is a prepayment penalty?
What are covenants?

Why should I do business with GE?

Size: GE is backed by a AAA-debt rating and the vast resources of our parent, General Electric Company. This enables us to offer customers reliable, well-capitalized, competitively priced financing products. Our total market capitalization permits the company to make both large and small investments. As a portfolio lender with this range of financing capability, GE offers excellent customer service and flexibility from loan origination to loan closure. Most importantly, as one of the world's premier diversified financial services firms, we'll be there when you need us.

Specialization and Knowledge: GE offers clients superior service resulting from specialized teams that are highly knowledgeable about specific industries. This knowledge allows our staff to quickly process applications, which results in quicker funding times for clients.

Flexibility: GE has the competitive advantage of being a portfolio lender. This allows clients a wide array of custom tailored lending options throughout the term of their loan.

Competitive Cost or Pricing: GE can offer competitive pricing, due to its large size and its ability to borrow at better rates in the market place.

back to top...


Why should I consider Franchise Finance?

As a preferred lender to many national franchisors, Franchise Finance puts its expertise to work for franchisees across the U.S. and Canada to deliver the most comprehensive franchise financing solutions available. We have relationships with over 350 different franchise concepts.

back to top...

What types of financing do you offer?

We offer funding for real estate and equipment, as well as acquisition financing and refinancing of existing debt and sale-leasebacks.

back to top...

What franchise concepts qualify for financing?

Whether you own one location or 100—whether you’re purchasing a new location, improving an existing one, or refinancing debt, we can help. Major concepts served include restaurant, hospitality, and petroleum.

back to top...

What loan amounts do you offer for financing franchises?

We offer loans of $100,000 and above.

back to top...

Do you offer advances?

We offer advances up to 100% of cost for equipment and 90% of cost for real estate. Acquisition advances are typically up to 90% of cost. Higher advance percentages may be available if warranted by cash flow.

back to top...

How long is the application process?

Generally, it takes 5-30 days from receipt of the loan package to funding, depending upon the type of loan request and the borrower’s submission of all required information.

back to top...

How does GE differ from a bank?

While both lend money to businesses, finance companies are more flexible than banks because they can take on a wider variety of loans and move faster in response to market changes and customer needs.

back to top...

How does GE price loans?

GE prices loans in order to provide cost-effective capital for our customers while earning a fair profit. Most loans that are underwritten and funded are either fixed rate or floating rate loans. Fixed rate loans mean that that interest rate on the loan is fixed and will not change over time. A floating rate loan may go up or down based on an index such as LIBOR, Commercial Paper (CP) or the Prime Rate. These indexes are described below:

Commercial Paper is the rate associated with high quality corporate short-term negotiable notes having an original maturity of less than 270 days.

LIBOR (London Interbank Offered Rate) is the rate that the most creditworthy international banks, dealing in Eurodollars, charge each other for large loans.

Prime Rate is based on many economic factors including the Federal Reserve's decision to raise or lower prevailing federal funds interest rates for banks' short-term borrowings. Banks use the Prime Rate in pricing commercial loans to their best and most creditworthy customers.

Treasuries are debt securities of the U.S. government issued through the U.S. Department of Treasury. Payment of principal and interest is guaranteed by the U.S. government, making Treasuries among the highest quality investments available. Treasuries are the benchmark against which other debt securities are measured.

The interest rates on GE fixed rate loans are generally based on five or ten-year Treasury rates plus a spread, while variable rate loans are based on commercial paper plus a spread. The spread for both fixed and variable rate loans vary according to each client's creditworthiness and various other circumstances.

back to top...

What are your interest rates?

Interest rates will depend on a variety of factors such as current short term market rates, timing of the loan and credit risk.

back to top...

How do commercial lenders earn a fair profit?

The cost structure of a commercial lender such as GE is not unlike that of a manufacturing concern. Where a manufacturer incurs cost of goods sold, GE incurs interest expense from raising funds in capital markets. Like nearly all businesses, GE also incurs overhead expenses such as salaries, operations, insurance, etc. Where a manufacturer earns income by selling its goods, GE earns income by charging interest on the money lent. A portion of GE's income comes from fees charged to the borrower to help recover initial costs in putting a transaction together and to contribute toward earning a fair profit. GE raises funds for lending in the commercial paper markets. In fact, GE is the world's largest issuer of Commercial Paper.

back to top...

What is a "portfolio lender"?

A portfolio lender is a lending institution that makes loans with the intention of holding the loans in it's investment portfolios. Portfolio lenders offer greater flexibility in the loan origination process, as well as down the road, than lenders who make loans with the intention of selling them - either immediately or at some time during the term.

back to top...

What is a prepayment penalty?

A prepayment penalty is a fee charged for early repayment of a loan balance to recover lost interest income associated with the early repayment of the loan.

back to top...

What are covenants?

Covenants are simply promises to conform to specific guidelines as part of a loan agreement. A borrower's promise to conform to specified financial ratios for the life of the loan, for example, is a covenant. Covenants help the lender monitor and control the loan while providing the borrower with the greatest possible loan.

back to top...