How to Raise a Warehouse Facility for a Small Business Lending Platform
Your first warehouse facility is the step change from lending your own capital to lending at scale. It is also the moment a lending platform gets underwritten like an institution for the first time. Here is the full sequence, the track record and loss curves you need, the tape and documents, the special purpose entity, advance rates, timeline, and how to approach providers so you close.
Published: ·Last updated: ·By Ed Freeman, Capital Advisor. PeerSense
How do you raise a warehouse facility for a small business lending platform?
You raise a warehouse facility for a small business lending platform in sequence: reach roughly 12 to 24 months of clean origination history with vintage level performance data; build static pool loss curves and a reconciled loan tape; document your underwriting, including a no stacking policy; set up servicing, account control, and a bankruptcy remote special purpose entity to hold the collateral; prepare financials showing tangible net worth to fund the equity gap; then approach the two or three lender finance providers whose mandate matches your asset class and stage, through a credible introduction, and negotiate the advance rate and eligibility box before the rate. First facilities commonly start in the single digit to low tens of millions and scale as performance seasons. PeerSense advises, helps prepare the package, and places platforms with institutional capital partners, paid at close; it is not a lender and does not provide the capital.
Originate $3M+ a month? Let's get you facility ready.
Tell us your monthly volume, months of history, asset class, and how you fund today. You get an honest read on whether you are ready for a first warehouse or should season, and whether a capital partner in our network matches. Confidential.
institutional: Response within 24–48 hours. No obligation.
The Sequence to Your First Warehouse Facility
A warehouse facility is not a single ask; it is a readiness project with a well defined order. Do it in this sequence and providers treat you as institutional from the first meeting.
1. Season the book
Reach roughly 12 to 24 months of clean origination history. Fund early originations with your own capital and private investors, and keep immaculate loan level data from loan one. This is the asset a provider actually underwrites.
2. Build the loss curves and tape
Assemble static pool loss curves by vintage and a loan tape that reconciles exactly. Missing histories, unexplained modifications, or numbers that do not tie out end diligence faster than anything else. Fixing the tape is the highest return work you can do.
3. Document underwriting
Write down your underwriting guidelines and your no stacking policy, and make sure the tape reflects them. Providers fund platforms whose stated rules match their actual originations.
4. Set up servicing and the SPV
Establish servicing, account control, and a bankruptcy remote special purpose entity to hold the collateral, legally separated from the operating company. This structure is what lets a provider lend against your receivables at all.
5. Show tangible net worth
Prepare financials that show real equity to fund the equity gap the facility leaves on each loan. The advance rate never reaches 100 percent, so your net worth funds the difference.
6. Target and approach
Identify the two or three lender finance providers whose mandate genuinely matches your asset class and stage, and approach them through a credible introduction, not forty through a mail merge. A shopped tape prices worse.
7. Negotiate the box, then the rate
Negotiate the advance rate and eligibility criteria before the interest rate. The advance rate and box decide how fast you grow on the equity you have; the rate is only a cost.
The Package Providers Expect
Arrive with all of this and you look ready. Arrive missing pieces and you signal you are early. Providers commit to platforms that look institutional on day one.
The mechanics of the facility itself, borrowing base, advance rate, covenants, are covered in the dedicated guide: how a warehouse facility works.
Timeline, Advance Rates, and What Drives Them
For a prepared platform, closing a first facility is a process measured in months rather than weeks: diligence on the tape and loss curves, structuring and term negotiation, legal documentation of the facility and the special purpose entity, and closing. The single biggest determinant of speed is preparation. A platform that arrives with clean data and the structure ready moves far faster than one fixing its records mid process.
Advance rates depend on asset class and performance and are set per facility. Secured small business term loans with clean, seasoned loss curves support higher advance rates; unsecured or shorter duration paper supports lower ones. These are market typical patterns, not guarantees. Whatever the class, negotiate the advance rate and eligibility box harder than the rate, because they decide how much of your equity each loan consumes.
How PeerSense Gets a Platform Facility Ready and Placed
PeerSense is a capital advisory and placement firm, not a lender, and it does not provide the capital itself. We review your origination and performance data the way a provider will, help you prepare the tape and the structure, tell you honestly whether you are ready or should season first, and introduce the lender finance providers in our network whose mandate matches. The routing is grounded in data: capital and lending patterns analyzed across 5,475 lenders and 2.1 million loans, with 899 credit boxes profiled.
We introduce the one or two whose mandate matches, quietly, without shopping your tape. A warehouse facility is a debt transaction, so this is debt advisory, not a securities placement, and it does not require a securities license. Compensation is set in a written agreement and paid at closing only.
Ready to raise your first warehouse facility?
Monthly volume, months of history, asset class, current funding source. You get an honest read on your readiness and, where the fit is real, a confidential introduction to a capital partner in our network.
institutional: Response within 24–48 hours. No obligation.
Raising a Warehouse Facility: Questions Operators Actually Ask
Deals We Structure
Representative profiles from the placement desk and from the forward flow network tape. Sizes and structures only. No counterparties named.
$12M Hilton flag hotel, Charlotte, NC
6.75% fixed | 65% LTV | 52 day close
$8M value add multifamily, Tampa, FL
SOFR +395 | 75% LTC | 14 day close
$6.5M mixed use development, Austin, TX
80% LTC | Interest only | 18 mo term
$2.8M QSR franchise (3 units) Indianapolis, IN
Prime +2.75% | 25 yr term. Equity injection is lender underwriting.
$3.2M/mo manufacturing AR, Cleveland, OH
1.5% factor fee | 90% advance | 48 hr funding
$1.8M 6 unit rental portfolio, Phoenix, AZ
7.25% | 75% LTV | No income docs | 1.25x DSCR
$350M to $1.5B committed purchase of future originations
True sale | Par or premium to UPB | Weekly or monthly settlement | Servicing usually retained
$100M to $500M revolving line against eligible receivables
80 to 95% advance | 2 to 3 year revolver | Often paired with a flow takeout
$200M seasoned pool sold in one trade
Priced off the tape | Off balance sheet at settle | Cash recycles into new production
Indicative only, as of August 1, 2026. Not a quote, commitment or offer of credit. Final pricing, leverage and terms are determined by the lender at underwriting, after full transaction materials are reviewed. PeerSense does not lend and does not set pricing. What these terms mean.