Franchise Resale Index: Which Brands and Sectors Resell Most, SBA Loans FY2020 to 2026

How often SBA franchise loans finance a franchise resale

This franchise resale index measures how often SBA-backed 7(a) money buys an existing franchise rather than opening a new one. It uses every franchise-coded 7(a) approval in the SBA 7(a) FOIA loan data from FY2020 to June 30, 2026 (46,582 loans) and the lender-reported business-age field, in which Change of Ownership marks a loan that finances the purchase of an operating business. We call these loans resale loans.

Resales are a minority of SBA franchise lending in the United States. 6,962 loans (14.9%, 90% interval 14.7% to 15.2%) financed a change of ownership. Startups that open a new unit accounted for 54.0%, existing units older than two years for 17.0% and units two years old or younger for 13.3% (FY2020 to June 2026). There were 3.6 startup franchise loans for every resale franchise loan.

Franchise loans are still more often resales than other SBA loans. 9.8% of 7(a) loans without a franchise code financed a change of ownership in the same period, so the franchise resale share is 1.52 times the non-franchise share. By dollars the picture shifts: resale loans carried 26.6% of franchise-coded 7(a) dollars, or $9.75 billion, because the median resale loan is much larger than the median startup loan. The overall franchise share of SBA lending is covered in our SBA franchise loans study; this report looks only at the resale slice.

Franchise Resale Index by brand, FY2020 to June 2026

Resale activity is concentrated in a minority of brands. Of 378 SBA franchise codes with at least 30 7(a) loans from FY2020 to June 2026 (30,050 loans, 64.5% of franchise-coded loans), 93 have a resale share whose 90% interval lies above the 14.9% average and 187 lie below it. The median brand resale share is 7.0%. 82 index brands, holding 4,598 loans, had no resale loan in the period, so every SBA loan to those brands financed a new or existing unit rather than a purchase.

Hotel brands, home care brands and older retail and automotive brands dominate the top of the index. Of the 93 brands significantly above average, 24 are accommodation brands, 16 are food service brands and 11 are fuel brands. Home Instead has the highest share among business-format brands: 95 of its 180 loans (52.8%, index 353) financed a change of ownership. Quality Inn (141 of 336, 42.0%) and Subway (132 of 378, 34.9%) combine a high share with large counts.

The largest franchise borrower in the window, The UPS Store, had 323 resale loans out of 1,044 (30.9%, index 207), the most resale loans of any code. The 10 codes with the most resale loans account for 1,248 resale loans, 17.9% of all franchise resale loans. Some concepts with heavy recent SBA borrowing sit near the bottom: Hotworx had 14 resale loans out of 490 (2.9%) and Scooter’s Coffee 5 out of 291 (1.7%), which means their SBA borrowing went almost entirely to new units. 20 of the 378 entries are supply, dealer or member agreements (for example fuel supply contracts) that SBA lists in its Franchise Directory; the table flags them.

Do older franchise brands have more resales?

The brief’s hypothesis was that resales concentrate in mature brands. The SBA files carry no brand founding date, so we used a proxy: the first fiscal year in which any 7(a) loan (FY1991 onward) carried the brand’s name. The gradient is steep. Brands with a 7(a) loan under their name by FY2009 had a pooled resale share of 25.6% (83 brands, index 171). Brands first seen in FY2010 to FY2017 had 13.5%, brands first seen in FY2018 to FY2019 had 10.6%, and 66 brands with no 7(a) loan under their name before FY2020 had 1.3%.

The pattern holds without hotels: excluding accommodation brands, the oldest group still shows 22.4% against 1.3% for the newest. Across 312 brands with a pre-FY2020 name match, the Spearman correlation between first year and resale share is -0.37. The proxy measures time in SBA lending, not brand age, and exact name matching misses brands that changed their name, so treat the groups as approximate.

Franchise resale share by sector

Sectors with real-estate-heavy or route-based units resell most often. Among 31 NAICS sectors with at least 100 franchise-coded 7(a) loans (FY2020 to June 2026), accommodation has a resale share of 36.7% (1,346 of 3,665 loans, index 246) and gasoline stations 31.4% (666 of 2,118, index 210). Accommodation alone supplies 19.3% of all franchise resale loans, close to food services (19.4%), which is far larger but resells less often (12.4%, index 83).

At the bottom, amusement and recreation (3,560 of its 4,488 franchise loans went to fitness centers) has a resale share of 6.1% (272 of 4,488, index 41), and personal services 8.6%. At the 6-digit level, hotels and motels reach 36.9%, home health care services 29.1% (264 of 907) and private mail centers 26.9% (200 of 744), while vending machine operators had 1 resale loan out of 376.

Franchise-coded hotel loans are more often resales than other accommodation loans: 20.3% of accommodation loans without a franchise code (a group that includes some uncoded franchise hotels) financed a change of ownership, against 36.7% of franchise-coded accommodation loans. Sector labels use 2022 NAICS titles; older 2017 codes were mapped with the Census 2017 to 2022 concordance.

What a franchise resale loan looks like next to a startup loan

A franchise resale loan is bigger, more often tied to real estate and priced slightly lower than a startup loan. The median resale loan was $806,000 from FY2020 to June 2026, 2.67 times the $302,000 median startup franchise loan. 44.2% of resale loans were $1 million or more, against 9.8% of startup loans. 31.6% of resale loans had a term of 240 months or more, which signals real estate, against 5.9% of startup loans.

Hotels pull the pooled median up, but the gap survives without them: excluding accommodation, the median resale loan was $590,800 and the median startup loan $300,000. Within 36 six-digit industries that had at least 30 loans of each kind, the median resale loan was larger in 31. The exceptions are hotels, gas stations with convenience stores, snack and beverage bars, fitness centers and pet supply stores, where the median resale loan was smaller than the median startup loan.

In FY2026 (November 13, 2025 to June 30, 2026) the median resale loan carried an initial rate of 8.75%, a spread of 2.00 percentage points over the prime rate on the approval date, against 9.50% and 2.50 points for startup loans (prime rate: Federal Reserve via FRED). Resale loans were less often approved through SBA Express (8.5% against 17.7%). The median lender-reported jobs figure was 10 for resale loans and 8 for startups; SBA does not validate that field. A loan amount is not a purchase price: buyers also bring equity (see the rules below) and may use seller financing. Cost ranges for new units are in our franchise costs guide.

Franchise resale share by state

Resale shares vary from about one in four franchise loans in the upper Midwest and Pacific Northwest to about one in nine in the Sun Belt. Among 39 states with at least 150 franchise-coded 7(a) loans (FY2020 to June 2026), Washington (262 of 1,060, 24.7%, index 165) and Wisconsin (24.6%, index 165) lead. 12 states sit significantly above the national share and 8 significantly below.

Florida (405 of 3,702, 10.9%, index 73) and Texas (721 of 6,484, 11.1%, index 74) are the lowest, and they are also the two largest markets after California (17.6%). A low share in a fast-growing state does not mean few resales; it means new-unit lending is larger there. State shares are not adjusted for sector mix. AK, DC, DE, HI, ME, MT, ND, PR, RI, SD, VI, VT, WV and WY fall below the threshold and are left blank. State counts of franchise businesses are in our franchise statistics by state report.

Franchise resale trend, FY2020 to FY2026

The franchise resale share fell from 19.8% in FY2020 to 11.7% in FY2023, then rose to 14.0% in FY2025 and 15.0% in FY2026 (to June 30). The startup share moved the other way, peaking at 62.1% in FY2024. The prime rate rose from 3.25% (March 2020) to 8.50% (July 2023) over the same years (Federal Reserve via FRED); the data do not show whether rates caused the shift.

FY2024 and FY2025 need care. SBA stopped publishing its Franchise Directory when 88 FR 21074 took effect on May 11, 2023, and lenders coded fewer franchise loans until SOP 50 10 8 brought it back on June 1, 2025, as our SBA franchise loans study documents. Coding did not drop evenly: franchise-coded hotel loans were 54.1% resales in FY2024 against 37.9% in FY2022, while uncoded hotel loans stayed near 25%. As a check that does not depend on coding, we tracked all 7(a) loans in 14 franchise-heavy industries (at least half franchise-coded in FY2020 to FY2023). Their change-of-ownership share fell from 20.4% to 13.5% between FY2020 and FY2023 and was 14.3% in FY2026, so the decline does not come from coding alone and the recovery is partial.

What changed for SBA business acquisition loans on October 1, 2026

SBA’s lending manual changed on October 1, 2026. SOP 50 10 8.1 applies to 7(a) applications that receive an SBA loan number on or after that date, according to SBA Information Notice 5000-880695 (August 14, 2026), and moves all change of ownership rules into a new Appendix 15. In SBA’s own words, change of ownership transactions “have grown to be among the largest categories of 7(a) lending.” The main points for a franchise resale buyer:

• Four transaction types: Initial Acquisition (a new majority owner), Business Expansion, Owner Buyout and ESOP and Cooperative. A buyer who was not an owner before and becomes the majority owner is an Initial Acquisition, the default category.
• Equity: at least 10% of total project cost for an Initial Acquisition, and it cannot be reduced. For a Business Expansion or Owner Buyout the 10% may be reduced or waived by the lender.
• Seller notes: debt on full standby (no principal or interest payments for the term of the 7(a) loan) may count as equity, but limited sources together may provide no more than half of the required injection. Seller notes can be refinanced after 36 months in place and current. Seller earnouts remain prohibited.
• Cash flow: minimum debt service coverage of 1.25 on historical results for an Initial Acquisition and 1.15 for a Business Expansion; SOP 50 10 8 required 1.15 on a historical or projected basis.
• Due diligence: a Quality of Earnings report when the business purchase price is $3 million or more (Initial Acquisition and Business Expansion). An internal valuation is allowed for 7(a) Small and SBA Express loans only up to a $350,000 purchase price (Information Notice 5000-882227, September 25, 2026); SOP 50 10 8 used a $250,000 financing threshold.
• Seller transition: in an Initial Acquisition the seller may stay only as a consultant, for up to 24 months (12 months under SOP 50 10 8).
• Partial changes: in an Owner Buyout, people employed by the business for less than 24 months may acquire less than 50% and may not become the largest owner.
• Terms: change of ownership loans amortize over no more than 10 years, with real estate portions and qualifying special purpose properties (SBA names hotels and storage units as examples) up to 25 years.

All FOIA counts in this report predate SOP 50 10 8.1, so none of these rules is visible in the data yet. The FY2026 Q4 file (as of September 30, 2026) is expected about one month after quarter end, which would be late October 2026. More on the buying process is in our buying a franchise guide.

Franchise transfer fees and transfer counts in FDDs

A franchise transfer fee is the fee a franchisor charges when an existing unit changes hands. Under the FTC Franchise Rule (16 CFR 436.5), Item 6 of the Franchise Disclosure Document (FDD) must list all other fees, and transfers are named among the fee types; Item 17 lays out franchisor approval of a transfer and the conditions for it; Item 20 Table No. 2 counts transfers, defined as “the acquisition of a controlling interest in a franchised outlet, during its term, by a person other than the franchisor or an affiliate.”

Fees vary by brand, and two FDDs filed in Minnesota in 2026 show the range for two high-index brands. Home Instead (FDD issued April 29, 2026) lists a $25,000 transfer fee and a $9,000 minority ownership change fee. The UPS Store traditional-center FDD (issued April 23, 2026) lists a $6,000 transfer fee plus a $6,000 processing fee ($1,500 if a finder’s fee is paid). These are two examples, not typical values.

Item 20 also lets a reader compare resale activity with a brand’s size. Home Instead reported 46 transfers in 2025 against 619 franchised outlets at the start of the year (7.4%); The UPS Store traditional-center FDD reported 237 transfers against 5,350 outlets (4.4%). Both brands sit well above the SBA resale average in our index, which is consistent with active secondary markets, but FDD transfer counts include buyers who did not use SBA loans.

Limits of this franchise resale data

Read this franchise resale data with six limits in mind.

• SBA loans only. Cash, conventional bank and seller-financed resales are not in the FOIA files, so the index describes SBA-financed resales, not all resales.
• Lender-reported fields. BusinessAge and the franchise code are entered by lenders. 0.9% of franchise-coded loans have no business age (6.5% in FY2020). A change of ownership can also be a partner buyout, not a sale to an outsider.
• Coding gap. Franchise coding fell while the SBA Franchise Directory was not published (May 2023 to May 2025), unevenly across sectors; brand and sector shares pool FY2020 to FY2026 to dampen this.
• Approvals, not closings. Cancelled approvals are included, as in the SBA franchise loans study. Excluding them moves the overall resale share from 14.9% to 15.3%.
• One code, one brand. SBA codes sometimes cover a brand family (several hotel brands list combined names), and 20 index entries are supply or dealer agreements.
• Loan size is not price. The FOIA files carry no purchase price, equity or seller-note amount.