# Franchise Remodel and Refresh Financing

> How to fund a franchise remodel or refresh: scope, timeline, contractor quotes, a cash reserve for closure days and the franchisor's written notice.

Source: https://mfebusinessloans.com/franchise-funding/remodeling/ (Merchant Fund Express, updated 2026-10-21)

## The short answer

Franchise remodel financing pays for a defined refresh at an operating unit: contractor work, fixtures, signage and the cash to cover days the unit is closed. Merchant Fund Express reviews the unit's deposits and existing payments, then sizes the request against the contractor quotes. Bring the franchisor's written remodel notice if there is one; it defines the scope better than anyone's summary.

## What should the remodel scope include?

A remodel request is only as clear as its scope. Write down what is changing and who is doing it.
Contractor work: demolition, flooring, walls, lighting, plumbing and electrical
Fixtures and furniture: counters, seating, display cases
Signage, menu boards and exterior finishes
Permits and inspection fees
Equipment swapped during the work (or finance it separately through equipment financing)
A contingency line for surprises behind the walls

## Bring the franchisor's written requirements

Do not rely on what another owner heard. If your franchisor has asked for a remodel or refresh, ask for the written notice: the required elements, the deadline and any approved designs or vendors. Merchant Fund Express does not assume any brand's remodel schedule; the scope comes from your documents and your contractor's quotes. If there is no notice and you are refreshing on your own, say so; the review reads the same way.

## Timeline and contractor quotes

Get the written notice and the approved design package, if any.
Collect at least two contractor quotes with line items and a timeline.
Mark which days the unit must close and which work can be done after hours.
Total the quotes, fixtures, permits, contingency and closure reserve.
Apply with that total and your bank statements.
Apply before the contractor needs a deposit. A complete file gets a same-day decision; funding often follows the next business day.

## Worked example: a remodel budget with a closure reserve

A hypothetical unit plans a refresh with 6 closed days. While closed it still pays rent, salaried managers, utilities, insurance and existing payments, about $1,350 a day.
Budget line | Figure |
Contractor quote | $84,000 |
Fixtures and signage | $11,000 |
Permits | $3,000 |
Contingency (10% of contractor quote) | $84,000 x 10% = $8,400 |
Closure-days reserve | 6 days x $1,350 = $8,100 |
Total project | $84,000 + $11,000 + $3,000 + $8,400 + $8,100 = $114,500 |
Owner cash put in | $30,000 |
Funding request | $114,500 - $30,000 = $84,500 |
Without the reserve, the owner would face the closure days with no sales and full fixed costs. Sales also take time to recover after reopening, so the first payment should fit a slower month.
Figures in this example are illustrations of the arithmetic, not an offer, quote or approval. Real terms depend on the file and the funder.

## Which product fits a remodel?

Situation | Product | Requirement it leans on | What to send |
Single quoted project, long payback | Term loan | Tier 1: 3+ years, FICO 650+, first position only | Quotes, notice, statements |
Work spread over months in phases | Line of credit | Tier 1; can sit in second position | Phased timeline, statements |
Unit under 3 years or FICO 600 to 649 | Revenue-based financing | Tier 2: 6+ months, FICO 600+, $60K revenue | Statements, quotes |
Mostly equipment, little construction | Equipment financing | Vendor quote and useful life | Vendor quote |
For the general guide to building out a space, read funding for a remodel of a commercial space.

## How does the review read a remodeling unit?

Merchant Fund Express reads the deposits of the entity that owns the unit over about 3 months, its royalty and advertising-fund debits, and its existing positions. Those debits are normal recurring obligations; payment capacity is sized after them. If you run several units, see multi-unit funding for which entity should apply.
Two details often slow a remodel file. First, deposits from the months before the work matter more than projections for after it, so apply while the unit is trading normally rather than mid-closure. Second, if the contractor wants staged deposits, show the payment schedule on the quote; it tells the reviewer when cash is actually needed and whether a lump sum or a line fits.

## Common remodel budget mistakes

Leaving out the closure-days reserve, then covering rent and salaries from payroll cash.
Using one contractor quote with no line items, which makes the scope hard to read.
Forgetting signage, permits or inspection fees that the franchisor's design package calls for.
Starting work before the funding decision, then needing the money in days instead of weeks.
Sizing the payment on the hoped-for sales bump instead of the current deposits.
Each of these is avoidable with a written scope, two quotes and a calendar. Merchant Fund Express reviews the plan you bring; the clearer the plan, the faster the decision.

## Keep reading

Franchise funding hub: all franchise guides
Remodel of a commercial space: the general build-out guide
Franchise lines of credit: for phased work
Franchise equipment financing: for equipment within the refresh

## Common questions

### Do you know my brand's remodel schedule?

No, and we do not guess. Bring the franchisor's written remodel notice and your contractor quotes; those define the scope.

### Can the closure days be part of the request?

Yes. A reserve for fixed costs during closed days is a legitimate part of a remodel budget and should be shown as its own line.

### Can I fund a remodel at a unit I am buying?

A transfer is a different situation. Read franchise transfer financing and the existing-vs-new guide.

### Do I need tax returns?

Not for a typical first review. Full financials are usually needed only above $250,000.

### What if I already have an advance on the unit?

Existing positions are counted. A new structure can lower the payment you carry today.

Apply with Merchant Fund Express: https://merchantfundexpress.com/current-application.html?utm_source=mfebusinessloans.com&utm_medium=franchise&utm_campaign=franchise-funding&utm_content=remodeling