Frequently Asked Questions

How Do You Know Which Type Of Loan To Pursue?

First Working Capital will determine the best, most cost effective path to obtaining the money you are seeking. We are experts in packaging applications that get favorable funding. We get results. You get money.

Qualifications for Gas Station Loan
  • Risk Criteria: 600+ FICO Score
  • Acceptable Personal and Business Financials
  • Industry experience is extremely helpful
Additional required documentation to be supplied to First Working Capital by applicant:
  • Seller's 2008, 2009 and 2010 Business Tax Returns
  • 2010 Seller Financial Statements
  • Interim Financial Statement for Business
  • 2008, 2009 and 2010 monthly gas volume sold report
  • Most recent appraisal
  • Most recent Environmental Site Assessment, Phase 1 (Phase 2 if available)
  • Purchase Contract
  • Fuel Supply Agreement
  • 2008, 2009 and 2010 Individual Tax Return of Buyer
  • Most recent credit report of Buyer
Application Process
  • Gas Station, Service Station and Gas & Convenience Store loans are complex by nature.
  • Initially, First Working Capital requests client/project information to begin "packaging" the loan and determine the viability of working with the borrower to complete the loan.
  • Once First Working Capital receives and verifies ALL requested client/project information, closing points and fees are determined. Closing points and fees CAN NOT be determined prior to loan package completion since each deal has its own issues and complexities.
  • First Working Capital submits and manages the loan application package to its funding sources. This process typically takes 60 – 90 days based upon the loan/project complexities.
  • The borrower pays the fees. The fees can be built into the loan proceeds or an agreement will be created to collect fees accordingly.
Why Is Getting A Gas Station Loan Through A Bank Generally Difficult?
  • Petroleum retail is a "cash business" and verifying cash flow is more difficult than other commercial income producing properties such as apartment buildings and office buildings. Being able to split gas revenues from convenience store revenues is often very challenging.
  • Petroleum retail has perceived environmental risks that are not present in many other types of commercial properties. It is much easier to evaluate a loan where there is significantly less perceived environmental risk.
  • Gas stations and convenience stores pose a larger problem for lenders if properties are ever foreclosed on. In the case of many income-producing properties, at a minimum the lending institution can inspect the rent roll and continue collecting rents until a suitable buyer is found. Banks do not step in and run gas stations and convenience stores in the case of default.
  • Defaults on gas stations and convenience stores have been at all-time highs.
  • Gasoline fuel margins have been their lowest in years due to the ever-increasing number of hyper-marts and big box retailers that do not care about fuel margins, but only about bringing people in their doors.
  • The volatile price of oil/barrel.
What Factors Are Most Often Attributed To Gas Station Default And/Or Foreclosure?

Insufficient equity into transactions and insufficient direct industry experience.

What Are The Main Reasons Loans Are Declined?
  • The documentation required for a gas and convenience store loan is very specific in its requirements. Many loan requests are not funded due to poor documentation and/or an incomplete application package. First Working Capital guides you through the process of collecting all the necessary documentation and then creates a loan application on your behalf. This process is crucial in properly preparing a verified and qualified loan application for submission.
  • Lack of direct industry experience.
  • Improperly managed and documented environmental issues.
How Is First Working Capital Able To Facilitate Gas Station Loans And Funding When Traditional Banks, In General, Don’t?

First Working Capital has industry expertise and funding sources knowledgeable of the Gas Station, Service Station and Gas & Convenience Store (G&C) industry.

What Are Your Interest Rates?

We quote interest rates, closing points and fees on a per application basis. Money is a commodity and rates may vary on a daily basis. Our competitive rates are based on Prime, Treasuries, LIBOR and on the contract structure and credit risk. Most loan approvals are at bank rates or near bank rates.

What About Terms?

The term depends upon the lender and funding deal. Typically, when buying the real estate along with the Gas Station business, terms can be 20 to 30 years. When buying the business by itself, without real estate, terms usually match the Land Lease agreement, which is usually about 10 years.

What Is Your Turnaround Time?

Our target is to have loans approved and closed within 60 - 90 days after receiving all necessary all requested information and completion of the application package.

Do You Require Phase 1 Or Phase 2 Environmental Reports?

Yes. First Working Capital requires the most recent Environmental Site Assessment, Phase 1 (Phase 2, if available). If the report is older than six months, it is usually required that the company updates the report.

The Station I Am Purchasing Is An Independent. Can I Obtain Financing?

Yes, but we would likely make sure that you have significant experience. It would also depend on if the borrower had a long-term fuel supply agreement.

Do You Do Construction Financing?


What Is The Most Difficult Loan To Do?

A business-only acquisition is usually the most difficult loan to close because of the lack of available collateral. Individuals without significant management experience and capital typically will have difficulty obtaining financing from lenders.

Is First Working Capital A Direct Lender?

No. First Working Capital has relationships with a variety of lending sources, unavailable to most brokers and borrowers directly. Upon understanding the circumstances of your particular situation and deal sought, we determine the best lending source for funding – then submit and manage your application for funding.