Overview
Private lenders underwrite car wash deals differently than banks. They often prioritize speed and flexibility, which means their underwriting focuses on collateral fundamentals, borrower liquidity, and the feasibility of a near-term plan. The deal is approved when the lender understands how risk is controlled and how repayment will occur.
Collateral first, but not collateral only
Private lenders typically start with the property and the market. They want to see a location that supports long-term demand and a collateral story that remains sellable if the plan is delayed. They still evaluate cash flow, but they may tolerate transitional performance if the plan is credible.
Liquidity and reserves
Liquidity is a key approval factor. Private lenders want borrowers to have the ability to fund repairs, handle delays, and protect uptime. A deal that uses every dollar at closing is viewed as fragile.
Equipment condition and downtime risk
Because car washes are equipment-driven, lenders evaluate condition, maintenance history, and repair needs. If the wash has recurring downtime, the lender will want a repair plan and budget that solves it quickly.
The exit strategy drives the structure
Private loans often require a clear exit, such as refinancing into SBA or bank financing after stabilization. Borrowers should define what must be accomplished during the loan term, such as consistent deposits, completed repairs, and normalized expenses.
What a strong private lender package includes
- Simple deal summary with purchase terms or payoff request
- Collateral overview including location strengths and site basics
- Operational plan focused on uptime and controls
- Repair scope with budget and timeline if applicable
- Exit plan with measurable milestones and timing
Bottom line
Private lenders underwrite car wash deals by focusing on collateral quality, borrower liquidity, and a credible transition plan. The clearest exit strategy usually produces the fastest approvals.