How to Finance a McDonald's Franchise in 2026

Total estimated initial investment per the current FDD runs $1.4M–$2.5M depending on whether you're acquiring an existing restaurant or building new. Most first-time franchisees acquire an existing unit. Lenders evaluate the following when underwriting a McDonald's franchise deal:

• Equity injection documentation: 25% of total project cost in liquid, non-borrowed cash — bank statements required. This is McDonald's requirement, enforced before the SBA loan structure is built.
• Net worth: Lenders want to see $750K–$1M+ total net worth, consistent with McDonald's own published thresholds.
• Operating experience: McDonald's requires new franchisees to complete a 9–12 month training program. Some lenders weight prior QSR management experience.
• Location cash flow (existing unit): If acquiring an existing restaurant, lenders will underwrite trailing 12-month revenue — DSCR (debt service coverage ratio) typically needs to exceed 1.25x.
• Personal credit: 680+ FICO is a common threshold for SBA franchise deals of this size, though some lenders go lower for exceptionally strong financials.

The SBA 504 program applies when real estate is part of the transaction — most commonly when a franchisee is acquiring the land and building rather than leasing from McDonald's Corporation. 504 structure for a McDonald's deal would typically look like: 50% conventional bank loan + 40% SBA 504 debenture (long-term, fixed rate) + 10% borrower equity. Because McDonald's controls the real estate in many of its locations, 504 is less common for initial entry but is relevant for multi-unit operators acquiring freestanding pads.

McDonald's does not operate a direct in-house lending program for franchisees. The company has historically directed franchisees toward established SBA-preferred lenders and conventional banks with experience in QSR franchise lending. McDonald's maintains relationships with a network of preferred-vendor lenders (communicated through the franchisee qualification process), but the financing itself is market-rate debt — there is no subsidized rate, deferred payment, or royalty-offset program from McDonald's corporate.

McDonald's is listed on the SBA Franchise Directory, allowing SBA-approved lenders to use expedited franchisor eligibility review. At $1.4M–$2.5M, most first-time buyers acquire an existing restaurant rather than build new. Key underwriting factors lenders evaluate:

• Equity injection: McDonald's requires a minimum 25% of total project cost in non-borrowed, liquid cash — this is a hard franchisor gate, not just an SBA guideline. On a $2M acquisition, that means $500K in documented liquid assets. Borrowed funds (HELOCs, 401(k) loans, family gifts) do not satisfy this requirement; lenders verify the source of funds in detail.
• Debt service coverage ratio (DSCR): SBA guidelines require 1.15× minimum DSCR. McDonald's acquisitions use trailing 12-month restaurant P&Ls as the primary DSCR input. Lenders typically want 1.25×–1.35× for deals above $1.5M given the full-service operating model and relatively thin restaurant margins.
• Net worth and liquidity: McDonald's requires a minimum $500K net worth and $250K in liquid assets at the franchisor level — lenders review the same statements to confirm quality. Liquid assets are weighted more heavily than illiquid real estate equity for purposes of the cash injection test.
• Operator approval and training: McDonald's must approve the buyer independently of SBA. Lender commitment letters are typically issued contingent on McDonald's final franchisee approval. First-time restaurant operators face a higher underwriting bar; prior multi-unit QSR experience is material to both the franchisor and lender.
• Acquisition vs. greenfield structure: Existing restaurant acquisitions are underwritten on trailing restaurant cash flow. New builds are underwritten on a pro forma with conservative year-one ramp assumptions. Lenders treat greenfield deals as higher risk and typically require stronger borrower liquidity and a longer operating history.