Glossary · Doing the deal
Franchise Transfer Fee
In short
A fee charged by the franchisor when an existing franchise is sold from one franchisee to another. This is an unavoidable cost in franchise resales.
What it means in a deal
If you're buying an existing franchise, the franchisor will likely charge a transfer fee to cover administrative costs and new franchisee training. This fee is part of your total project costs and should be factored into your deal budget. Confirm the exact amount with the franchisor early in the process.
Official sources
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Franchise Transfer Fee
- Can an SBA 7(a) loan cover the cost of a franchise transfer fee in an acquisition?
- How does the SBA review franchise agreements for compliance if there are unusual clauses regarding termination or transfer?
- Can I use an SBA 7(a) loan to finance a franchise fee for an existing franchise location?
- Can an SBA 7(a) loan finance the cost of a franchise fee for a new or existing franchise?
- Can I use an SBA loan to acquire a non-SBA approved franchise if I pay the franchise fee myself?
- Does an SBA 7(a) loan cover the initial franchise fee and associated startup costs?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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