Securing a Loan to Purchase a Building for our Microschool

To purchase or not to purchase.
This is the question.

We decided to pursue purchasing a building after years of operation and growth, and we waited for multiple stars to align. We were not alone in the process, and we had key relationships. We went from starting an office in a chiropractic clinic to renting space in a church until the church was placed for sale. Many pieces fell into place… And suddenly, a purchase was possible for us. 

The nuts and bolts

Securing a loan requires a lot of work. We had four years of financials, an accountant who helped us maintain solid monthly summaries, and a strong relationship with our bank. That same bank had given us our very first loan when we opened our doors. We had history. We had trust. We had proof of good payment.

We had also worked very, very hard to build reserves, hoping one day they could be used for a down payment. Since opening, we’ve been ultra-careful and conservative with our finances. This matters. You have to have a long-term plan and be able to show that sustainability has always been part of your thinking.

We are also a 100% women-owned business, which opened the door for a Small Business Administration (SBA) loan. This allowed us to put down 10% instead of the typical 20%, which helped tremendously.

We met with the SBA team, who walked us through how the loan worked, what steps were required, and what paperwork we would need. Building this relationship early mattered. When the timing was right, they were ready because they already knew us and our goals.

Our bank was ready to provide the other half of the loan. The down payment came from our savings and a partnership with one other family. We were ready to move into negotiations.

That process took nine months.

Lessons learned for those hoping to purchase

• Start looking now. Learn the zoning and city codes in your area and view every potential space through that lens.
• Look forward, not just at today. Don’t shop for what you need right now. Shop for what your vision will require down the road. If you buy, this is likely your forever home. Be forever-home ready.
• Create savings “buckets.” I have too many to count, so I won’t share my exact strategy, but you’ll want at least one account you don’t touch. Let it grow. Find a place for that money where it earns the best interest you can get.
• Build a relationship with your bank. If possible, take out a small loan early so you understand the process and build credit with them. That history matters when you’re ready for something bigger.
• Ask your bank to connect you with an SBA provider. Meet with them. Build the relationship. These relationships will be pivotal.
• Hire a lawyer. My dad is a retired lawyer and helped us immensely when we first opened, but he also made sure we knew we needed a practicing attorney for the purchase. There are so many contracts and legal decisions. Don’t do this alone. Did we pay a lot in legal fees? Yes. Worth every penny. We had planned and saved for it.
• Hire or build a relationship with anaccountant and know where every dollar goes. Our accountant can email me about a specific purchase, and I always know the exact details and reasons. This clarity allows you to make decisions that are best for your kids, your staff, and your space. Nothing is about “right now.” Everything is about the bigger picture.
• Expect the process to take months. Negotiating the sale takes time. Once that closes, the financing begins. Payments won’t all start at once, and interest rates, especially SBA rates, won’t be finalized immediately. You must plan months ahead and budget accordingly.
• Expect costs to rise. During the closing process, you’ll pay for things up front, and these things will almost always cost more than expected. Breathe. Refer back to saving and preparation.
• Be ready for hard months. You will want to quit. More than once. The right path is rarely the easiest one. Keep going.

There are a million caveats within each of these lessons. These are big-picture truths. And as I’ve said before, you are not alone. The National Microschooling Center is an incredibly trusted resource with deep connections that can help in so many ways. - I work with them and can walk you through your questions.In the end, only you can know whether purchasing is the right move for you and your school.

For us, I can say this:  Purchasing a building was nowhere near the easiest path, but it has proven to be the best one for this chapter of our story.

Reach out if we can help.