Laundromat financing with an SBA loan
Laundromats · NAICS 812310 · Program that usually fits: 7(a)
Laundromat financing is one of the easier SBA cases to make: the business is cash-based, the equipment is the collateral, and most locations have years of utility bills that prove the volume. Lenders use water bills to verify a seller's claimed revenue, so ask for them before you make an offer.
Who qualifies
Buyers of existing stores are the main borrowers, followed by owners replacing a full set of machines. The SBA treats laundromats as an active business, not passive real estate, so you qualify as long as you own and run it. First-time owners get approved regularly because the operating model is simple to underwrite.
Which SBA program fits
7(a) for buying a store
Covers the business purchase, machines, build-out and working capital in one loan, typically on a 10-year term.
7(a) or equipment loans for retooling
Replacing washers and dryers across a store often runs $150,000 to $500,000. A 7(a) loan amortizes that over 10 years, which keeps the payment below the utility savings from new high-efficiency machines.
504 if you buy the building
Laundromats that own their building can finance it with a 504 loan at a fixed rate, with the business equipment on a separate 7(a).
What borrowers use the money for
- Buying an existing laundromat
- Replacing washers, dryers and water heaters
- Build-out of a new location, including plumbing and electrical
- Adding wash-and-fold or pickup-and-delivery service
- Buying the building
Typical loan amounts, down payment and terms
Loan sizes run from $100,000 for a machine refresh to about $1.5 million for a large store with real estate. Equity injection is normally 10% to 15%. Lenders look closely at lease length: they want a lease, including options, at least as long as the loan term.
Example: a $400,000 loan
At today's maximum variable 7(a) rate of 10.00% over 10 years, the payment would be about $5,286 a month. Most well-qualified borrowers get a lower rate. Try your own numbers.
Today's rate caps
These are the SBA's maximum 7(a) rates with prime at 7.00%. See current SBA 7(a) rates and SBA 504 rates for the full picture.
| Loan amount | Maximum spread | Maximum variable rate today |
|---|---|---|
| $50,000 or less | Prime + 6.5 | 13.50% |
| $50,001 to $250,000 | Prime + 6.0 | 13.00% |
| $250,001 to $350,000 | Prime + 4.5 | 11.50% |
| Over $350,000 | Prime + 3.0 | 10.00% |
Related industries and lenders
SBA lenders active nationwide
Questions about laundromat financings
Can I get an SBA loan to buy a laundromat?
Yes. Laundromats are eligible for 7(a) financing, and buying an existing store is the most common use. Lenders verify revenue with water and gas bills, so a store with clean utility records is far easier to finance than one with only owner-reported numbers.
How much down payment is needed for laundromat financing?
Most lenders ask for 10% of the purchase price, and up to 15% when the buyer has no experience or the store's revenue is declining. Seller financing on standby can count toward part of the equity injection.
What term can I get on a laundromat loan?
Business purchases and equipment loans run 10 years. If real estate is more than half of the project, the whole 7(a) loan can go to 25 years. A 504 loan on the building is 20 or 25 years.
What interest rate applies to laundromat SBA loans?
The SBA cap on a loan between $250,001 and $350,000 is prime plus 4.5, or 11.50% today, and prime plus 3 above $350,000. Well-qualified buyers usually get a rate below the cap.
Do I need laundromat experience to get approved?
Not strictly, but it helps. Lenders want to see that you can manage cash collection, machine maintenance and staffing. Taking over an existing store with a trained attendant and a service contract on the machines makes the case for a first-time owner.
Sources: SBA 7(a) terms, conditions and maximum variable rates; Federal Reserve H.15 selected interest rates (bank prime loan rate); October 2026 SBA 504 debenture pricing, as published by CDCs; SBA FOIA 7(a) and 504 loan-level data.