Franchise Financing Options for HomeVestors: SBA Loans, 401(k) Rollovers, and Veteran Discounts

Finding the right franchise is one decision. Figuring out how to pay for it is another, and for most people, the financing question is where things slow down. The good news is that franchise financing options for a business like HomeVestors are well-established, and most prospective franchisees end up choosing from the same handful of paths.

There are two different financing questions in real estate investing, and it’s easy to conflate them. One is how you finance the properties you buy and renovate; that’s a separate topic covered elsewhere on the HomeVestors site. The other is how you fund the franchise itself: the initial investment, the franchise fee, and the working capital that gets you operational. That second question is what matters before you ever buy your first property.

What Does It Actually Cost to Get Started?

Before looking at franchise financing options, it helps to have clear numbers. HomeVestors offers two franchise tiers, and the investment ranges are meaningfully different.

The Associate Franchise has a total estimated initial investment of $109,000 to $415,250, according to the full HomeVestors franchise cost breakdown. The Full Franchise has a total estimated initial investment of $155,000 to $461,250. Both figures come from Item 7 of the current Franchise Disclosure Document.*

The range within each tier is wide because the largest variables aren’t fees. They’re advertising spend and the working capital you set aside for actual property acquisitions. If you’re planning to buy properties quickly in a competitive market, your working capital requirements will be higher than those of someone starting more conservatively. That context matters for lenders and financial advisors, who’ll want to understand what you’re actually funding.

SBA Loans: The Most Common Path for How to Finance a Franchise Purchase

The SBA 7(a) loan program is the most widely used approach for franchise investments in the United States, and HomeVestors qualifies as a franchised business for these purposes.

SBA 7(a) loans offer several practical advantages for franchise financing: longer repayment terms (often 10 years or more), lower required down payments than conventional business loans, and competitive rates backed by a government guarantee to the lender.

The main requirements are standard. You’ll need solid personal credit, a business plan, and a down payment of typically 10% to 30% of the loan amount. The application process is more involved than conventional financing, so it’s worth working with an SBA-preferred lender who has experience with franchise transactions.

SBA loans are typically used to cover the franchise fee and initial working capital. They’re not usually structured to also cover ongoing property acquisitions, since these are asset-backed transactions with their own financing mechanisms.

401(k) Rollovers: Using Retirement Funds Without Early Withdrawal Penalties

If you have a 401(k) or other qualified retirement account, there’s a financing structure called a ROBS (Rollover for Business Startups) that lets you use those funds to capitalize a new business without triggering early withdrawal taxes or penalties. This is one of the more useful HomeVestors financing options for people who’ve been building retirement savings throughout their careers.

The structure is legal, but it’s also complex. A C-corporation is established for the franchise, and a new 401(k) plan is set up under it. The retirement funds roll into the new plan, which uses them to purchase stock in the corporation. That provides the equity capital the business needs to get started.

Because the structure involves an active 401(k) plan with ongoing compliance requirements, the IRS and DOL both have the ability to audit ROBS arrangements. If yours isn’t structured and maintained correctly, the tax advantages can unwind fast.

The short version: ROBS can be a legitimate and effective way to fund a franchise purchase, but it’s not a DIY project. Work with a qualified ROBS provider who specializes in this structure, not just any financial advisor who’s familiar with retirement accounts.

Veteran Discounts and HomeVestors Financing Options for Military Families

HomeVestors participates in the International Franchise Association’s VetFran program, which is designed to make franchise ownership more accessible for military veterans and their spouses. The program provides a discount on the initial franchise fee for qualifying veterans.

If you’ve served in the U.S. military, it’s worth asking about the veteran discount when you connect with a HomeVestors franchise development representative. The discount reduces your initial out-of-pocket investment, which can make a meaningful difference in how you structure financing across the other options on this page.

Veterans are also often strong candidates for SBA loan programs, and some lenders specifically prioritize veteran-owned business applications. The combination of a veteran fee discount and an SBA loan can significantly improve your starting position.

Combining Franchise Loan Options: How Most Franchisees Structure It

Most franchisees don’t rely on a single financing source. A common structure looks something like this:

• A ROBS arrangement provides the equity capital needed to satisfy an SBA lender’s down payment requirement
• An SBA loan covers the remainder of the startup investment
• Personal working capital covers the first several months of operating expenses before property sale proceeds start flowing

Your specific combination will depend on your retirement savings, your credit position, your timeline, and how aggressively you plan to acquire properties in the early months. The HomeVestors development team can walk you through what other franchisees in similar situations have used, though the specific structure of your financing is a decision you’ll make with your own financial advisor.

Frequently Asked Questions

What franchise financing options work best for a HomeVestors investment?

The most common approaches are SBA 7(a) loans, which work well for covering franchise fees and initial working capital, and 401(k) rollovers through a ROBS structure, which can provide equity capital without early withdrawal penalties. Many franchisees combine both. The right approach depends on your personal financial situation and how much you have available for a down payment.

Does HomeVestors offer in-house financing?

HomeVestors doesn’t provide direct financing for the franchise purchase. The investment ranges in its FDD reflect what you’d need to have available or finance through third-party lenders. Your Development Agent can share what other franchisees have used and help you understand what the real costs look like.

Is a HomeVestors franchise SBA-eligible?

HomeVestors is a franchised business operating under an established franchisor, which generally qualifies for SBA loan programs. The specific terms and eligibility depend on your personal financial profile and the lender you work with. Working with an SBA-preferred lender who has franchise transaction experience makes the process significantly smoother.

How much do I need in cash before applying for financing?

SBA lenders typically require 10% to 30% of the total loan amount as a down payment, plus evidence of adequate working capital. Given the investment ranges for both tiers, most franchisees need meaningful personal liquidity before financing covers the rest. The specific amount depends on which tier you’re pursuing and how you’re structuring the deal.

Ready to See What Financing Could Look Like for You?

The financing question is answerable, but it takes some legwork. If you’re seriously evaluating HomeVestors as an investment, the most practical next step is to download our investment report to review the actual numbers, then have a conversation with your financial advisor about which structure fits your situation.

Ready to take the next step? Connect with the HomeVestors team to explore your financing options and get a better sense of the timeline for starting your franchise.

*See Item 7 of the HomeVestors® Franchise Disclosure Document for complete details. The information contained herein is for informational purposes only and in no way shall constitute an offer for the sale of a franchise.

Each franchise office is independently owned and operated.