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Achieve Your Dream of Buying a Business
The SBA 7(a) Loan is the most flexible business acquisition loan product on the market. Let the FLS Funding Marketplace find the right lender for you. Get Pre-Qualified today!
The SBA 7(a) Loan - The Best Loan For Business Acquistions
Lower Equity Requirement
Lower Equity Requirement
Lower Equity Requirement
The SBA 7(a) loan allows a lender to lend up to 90% of the purchase price. The other 10% comes from you. However, you can lower your equity injection by using a seller held note or receiving a gift of money. You can possibly lower your personal injection to 0%.
Buy the Building Too!
Lower Equity Requirement
Lower Equity Requirement
The SBA 7a loan product allows you to not only buy the business but also the building, all at the same time. Don't make rent payments, build equity. Utilize the SBA 7(a) loan product to build true generational wealth.
Longer Amortizations
Lower Equity Requirement
Longer Amortizations
The SBA 7(a) loan allows for a 10-year amortization for business purchases. But, if you include the real estate, your amortization could be as long as 25 years. These structures are much more favorable than traditional commercial loans.
100% Expansion Loans
Lower Equity Requirement
Longer Amortizations
Are you opening a new location or buying another business in your industry? The SBA 7(a) loan allows for 100% financing for expansion loans used for these types of transactions. Open a new location, buy a competitor, or buy a peer in another market and finance 100% of the purchase.
Be Prepared For Success!
Have a Detailed Business Plan Ready!
All SBA loans backed by the federal government require a detailed business plan to be submitted to the lender for approval. They want to know that you have taken the time to learn about the industry, business, and the market you are trying to enter.
Financial Projections are a Must!
Even though the business you are wanting to buy most likely has tax returns to support the asking price, the SBA will require you to create 36 months of detailed revenues and expenses showing the how your new business will perform over the next 3 years.
Other Necessary Documents to have ready to get Pre-Qualified to buy your new business!
- Last 3 years of Personal Tax Returns
- Last 3 years Business Tax Returns if you own other businesses
- Last 2 months of personal and business bank statements
- Investment Account Statements
- Crypto balances
- Retirement Account Statement
- Listing of all Real Estate Owned and their associated debt
- Driver's License
- Seller's Business Tax Returns (if available)
- Seller's Year End Profit & Loss Statement (if available)
- Draft of Purchase Agreement (if available)
Steps to Buying A Business
Self-Assessment and Research
- Determine the type of business you're interested in and assess your skills, experience, and financial capabilities.
- Research the industry, market trends, and competition to understand the potential challenges and opportunities.
Identify Prospective Businesses
- Look for businesses that are listed for sale through online marketplaces, business brokers, classified ads, industry associations, or networking.
Initial Evaluation
- Review the financial records, including income statements, balance sheets, tax returns, and cash flow statements, to assess the business's financial health.
Business Valuation
- Determine the value of the business by considering various factors such as financial performance, market conditions, industry standards, and assets.
Negotiation
- Negotiate the terms of the deal, including the purchase price, payment structure, assets included, liabilities, and any contingencies (e.g., due diligence, financing, non-compete agreements).
Due Diligence
- Conduct a thorough investigation of the business's operations, finances, legal status, contracts, leases, intellectual property, employee agreements, and any other relevant aspects.
- This step is critical to ensure you're fully aware of the business's strengths, weaknesses, and potential risks.
Determine Financing
- Determine how you'll finance the purchase. This could involve using your own funds, seeking a bank loan, securing investor funding, getting a seller held note, or a combination of these.
Legal and Professional Assistance
- Engage professionals such as attorneys, accountants, and business brokers to help with legal and financial aspects of the transaction.
Finalizing the Agreement
- Work with your legal team to draft a comprehensive purchase agreement that outlines all terms, conditions, and contingencies.
Closing the Deal
- Once both parties are satisfied with the terms, sign the purchase agreement, and complete any required legal and financial transactions.
- Transfer ownership of assets, contracts, licenses, and other business-related items.
Transition and Integration
- Develop a plan for the transition period to ensure a smooth change of ownership.