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The day-to-day realities of operating a pest control business don't always align with when you have cash in your bank account.
Your truck breaks down, a property manager wants three new buildings added immediately, and an operator across town is willing to sell their route list; they all need money as soon as possible.
When you find yourself strapped for cash, pest control financing can be a solid option. I've worked with a variety of pest control businesses, and below, I'll go over your options for pest control financing. We'll get into what lenders typically review, ways to increase your chances of approval, and the overall cost.
| Financing type | Best for | Borrow up to | Funding speed | Repayment |
|---|---|---|---|---|
| Short-term business loan | Route purchases, franchise fees, and territory launches | $10,000 to $5 million | As fast as same day | 6 to 36 months, weekly, biweekly, or monthly |
| Business line of credit | Chemical orders and payroll gaps that repeat | $5 million | As fast as same day | Revolving, 6 to 36 months, weekly or monthly |
| Equipment financing | Spray rigs, tanks, and inspection tools | 100% of equipment value | 1 to 5 days | 12 to 72 months, monthly |
| SBA loan | Larger or longer-term needs like an acquisition | $5 million | As fast as two weeks, typically 30 to 90 days | 10 to 25 years, monthly |
| Home equity line of credit (HELOC) | Established operations expanding against home equity | $750,000 of available home equity | As fast as one week | Up to 30 years, monthly, with a draw period up to five years |
| Merchant cash advance | Fast cash when other routes are closed | $5 million | As fast as same day | No fixed term, repaid from a share of sales |
Why Pest Control Businesses Borrow
Pest control businesses borrow for many different reasons, but these are the ones I see most commonly.
Route vehicles
A branded truck or van is the one major purchase most operators will make. Equipment financing can help to spread this out based on how many years you plan to use your vehicle.
Chemicals and inventory
Build an inventory of chemicals using a business line of credit. Use it to purchase supplies for treatment ahead of a busy season.
Hiring technicians
It takes a new technician a while to ramp up on their route. A short-term business loan or a working capital loan can help cover payroll while they build a book of business.
New territory
Entering a new area or opening a second service location requires additional equipment, personnel, and advertising. A business line of credit or a short-term business loan covers these costs.
Franchise fees
Franchisors typically charge an initial franchise fee and require a royalty payment. Short-term loans fit here.
Slow seasons
When revenue falls during the winter season, a line of credit or a business credit card can help fill in the gaps on small purchases.
Types of Financing for a Pest Control Business
Each of these financing options addresses a separate challenge for a pest control business. Here's how each is different.
Equipment financing
Finance up to 100% of the equipment's value with repayment terms from 12 to 72 months. The equipment (sprayers, tanks, hose reels, bait stations, and cameras) serves as collateral.
Business line of credit
Draw against a pre-set credit limit at any time for chemicals, payroll, or other expenses. Only pay interest on the amount you draw.
Short-term loan
A single lump sum paid back over a fixed repayment term. Use it to cover large expenses like buying a new route, paying a franchise fee, or expanding into a new territory. Loans range from $10,000 to $5 million.
SBA loan
These loans are partially guaranteed by the U.S. Small Business Administration, which allows lenders to offer more competitive terms and interest rates. The approval process for SBA loans usually requires 30 to 90 days, making it better suited for long-term or planned growth.
Home equity line of credit (HELOC)
Borrow against the existing equity in your home with a draw period lasting up to five years. Your home serves as collateral.
Merchant cash advance
Advance a percentage of your future sales paid back on a factor rate from 1.08 to 1.45. Money can move quickly, but the cost is typically higher than other options on this list.
One other route I'll mention is invoice factoring, which lets you advance money on open invoices. Factoring approval depends on your customer's credit score instead of yours. Factoring fees range from 0.5% to 5% monthly on each invoice.
Invoice factoring can only be used on commercial accounts. You can't use it with residential customers.
Minimum Qualifications
$10,000 in monthly revenue
Your business must earn at least $10K per month in a business bank account.
500+ credit score
You can get approved with any credit score. But the better your credit rating, the better interest rates lenders offer. Your FICO score should be above 500.
Minimum six months in business
Your company should be operational for a minimum of six months. This shows business lenders that your company is sustainable and won't go out of business.
Have a business bank account
Your Clarify advisor will need three or four months of your most recent bank statements to verify income. This is just to see you're actually making $10K+ month in revenue.
How To Improve Your Approval Odds
Showing steady income typically increases your chances of approval with both traditional and alternative lenders. Here's how to strengthen your application.
Recurring contracts. The amount of recurring revenue on your books depends on the size of your business. Smaller pest control businesses (under $250,000 in annual revenue) should aim to have at least 30% to 40% of their business come from recurring revenue, while larger businesses ($500,000 to $1 million) should plan for 60% to 75%.
Figure out your route density. Tighter route densities typically mean lower operating costs because of reduced fuel consumption and increased daily stop counts. Although lenders may not ask about route density, they can usually tell based on your financial reporting.
An up-to-date license. All states require pest control technicians to get a license. You may also need a license for the use of restricted materials and chemicals.
Separate bank accounts. Keep all business transactions in a separate business bank account so the lender can tell the difference between your personal and business spending.
Organized documents. Prepare recent financial statements like business bank statements, financial statements, and tax returns.
What Lenders Consider
Lenders typically weigh a handful of factors when reviewing your application. Here's what lenders pay attention to.
Time in business
A lender will typically require at least 6 months in business, but some may ask for longer.
Revenue and cash flow
Lenders review your monthly revenue as well as the cash available after deducting all expenses, which shows them how much remains to apply toward loan payments.
Personal credit score
Both conventional and alternative lenders evaluate your personal credit score in addition to your business finances. A better score unlocks better interest rates and repayment terms.
Loan amount
Lenders compare the size of the loan to your monthly cash flow. Smaller requests are generally approved faster.
Collateral
Some types of financing (equipment financing) are secured by an asset, while others are revenue-based.
Industry experience
Lenders consider whether this is your first time opening a pest control business or your fourth location.
What Pest Control Financing Costs
The cost of pest control financing depends on the type of financing you select, in addition to the interest rate and repayment terms. Let's take a look at a $50,000 loan at a 6% APR and how that stretches over two different repayment terms.
| Repayment term | Monthly payment | Total interest paid |
|---|---|---|
| 24 months | $2,216 | $3,185 |
| 36 months | $1,521 | $4,759 |
The other side of the math is the cost of running the business. In my experience, the most expensive part is usually the equipment: the vehicles you need to maintain and the specialized tools to support your technicians day to day.
Here's a breakdown of some major expenses.
State licensing
$200 to $800
Liability insurance
$1,200 to $3,000 per year
Used service vehicles
$15,000 to $25,000
Professional equipment
$3,000 to $7,500
As your business grows, you may consider adding additional technicians. The median yearly salary for a pest control technician in the U.S. is $42,250, according to the Bureau of Labor Statistics.
Using a HELOC To Expand Your Pest Control Business
One other financing option I'll mention is a home equity line of credit (HELOC). HELOCs are revolving credit lines that you can draw on, repay, and draw again. Lines run up to $750,000 through Clarify Capital's lender network.
The biggest difference between a HELOC and the other pest control financing options on this list is that lenders underwrite HELOCs based on your personal credit score, rather than the business. This means if you can't pay back the loan, you're putting your home at risk.
Finance Your Pest Control Business With Clarify Capital
In my experience, the most difficult part of any project is matching the financing to your needs. A spray rig or truck suits equipment financing, while a large purchase of chemicals can be covered under a business line of credit.
Apply today to see what your pest control business qualifies for. Clarify Capital connects you with our network of 75+ vetted, reputable lenders. Checking your options won't affect your credit score.
Frequently Asked Questions on Pest Control Financing
These are the most common questions I get about pest control financing.
What Is the Monthly Payment on a $50,000 Business Loan?
The monthly payments depend on the loan terms (the length of time for repayment) and the annual percentage rate (APR). At a 6% APR over 24 months, a $50,000 loan runs about $2,216 a month. Stretch to 36 months, and it drops to $1,521 monthly, though you'll pay more interest.
How Profitable Is a Pest Control Business?
Pest control businesses can be very profitable. They typically earn between $400,000 and $743,000 in annual revenue, though it depends on the size and location of your business.
How Do You Qualify for a $200,000 Business Loan?
With larger loans like this, lenders want to see steady revenue, at least two years of operating history, financial statements, and consistent operating performance. They'll also take a look at your existing debt to ensure you can handle the monthly payments.
How Hard Is It To Get a $1,000,000 Business Loan?
These are typically more difficult to get than smaller loans. You'll need to supply multiple years of financial statements, tax returns, show steady cash flow and revenue, and have solid credit.
Do You Need a License To Run a Pest Control Business?
Yes, all states require pest control technicians to get a license. You may also need a license if you use restricted chemicals. These typically cost $200 to $800, depending on the state.
Can You Get Financing To Start a New Pest Control Business?
It's more challenging for a startup or new business to get financing since most lenders want to see at least six months of operating history. Pest control businesses that are just starting out may explore SBA Microloans. These are smaller loans up to $50,000 offered by nonprofit community lenders.
What Equipment Do Pest Control Businesses Finance Most Often?
Pest control businesses most often finance equipment like spray rigs, skid sprayers, and service vehicles.
How Does Clarify Keep My Information Secure?
Clarify follows SOC 2 security principles. Applications go through an encrypted online form, and a lending advisor reviews your file directly rather than routing it through a call center or chatbot.
Bryan Gerson
Co-founder, Clarify
Bryan has personally arranged over $900 million in funding for businesses across trucking, restaurants, retail, construction, and healthcare. Since graduating from the University of Arizona in 2011, Bryan has spent his entire career in alternative finance, helping business owners secure capital when traditional banks turn them away. He specializes in bad credit funding, no doc lending, invoice factoring, and working capital solutions. More about the Clarify team →
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