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INTRODUCTION Hello. My name is Eric Gall. I am a business
intermediary with Florida Business Exchange in Southwest Florida. If you are looking to
sell your business, you likely have quite a few questions about the process. This video
short is one of 18 I have created in a series to answer your most frequently asked questions.
WILL I HAVE TO FINANCE THE SALE? Another frequently asked question from business
owners is will I have to finance a portion of the purchase price. One answer is no, not
if you are willing to take a significant discount on price. However, the best answer is, it
is likely in your best interest to finance a portion of the sale. Times have changed.
Traditional sources of capital such as banks and SBA loans have become increasingly more
difficult to obtain throughout the recession. As you can see from the chart on the left,
banks are just now starting to increase their commercial loan portfolios; however, before
making a loan they expect near perfect credit and more importantly, sufficient collateral
prior to writing you a loan. As you can see from the chart on the right, seller financing
accounted for 78% of all financing for business sales in 2010. Even if you finance a loan
through the SBA and/or a bank, more often than not, they will require the seller to
hold a note for at least 5 to 10% of the business price.
CONCLUSION Thank you for listening. If you have any questions
about this topic, or any other topic, please do not hesitate to contact me at 239-738-6227
or eric@buysellflbiz.com. I'm here to help you prepare your business for your eventual
exit.