The owner of the business (small hotel) I’ve worked for for the past few years is looking to sell. I’m interested.
How hard would it be to get a loan for 270k to put a down payment towards a ‘lease-to-own’ business? I have 30k to put down on the loan. Is a loan like this impossible, do I need investors?
In total for he business, she wants around 5 million (+ interest), with 300k down and 10 year lease-to-own to pay back the remaining balance.
The business has been around 20+ years and is successful. Last year the net income was just shy of 1 $1million (very good year), but on average is 700k/year.
I’ve owned/operated a VERY VERY small LLC for 2 years, and currently work for the company I want to buy and have worked most of the roles there, but not a manager role. I would be owning/managing it if purchased. I have excellent credit (800+) and have about 30k in government student loans which I am in good standing. I have a Masters degree in STEM, but nothing in a business related field.
I’m currently paid under the table and report a lower income then I actually make.
Would any lender (maybe through SBA 7a?) lend me money to put a down payment on the business? If not, what variables can I change to make it more likely. If I can put more than 30k is it more likely?
Thanks in advance.
$4.7 million at 13.5 percent interest (prime + 5.0%) over ten years is monthly mortgage payment of just over $71,500 or $858,000 annually.
$1.0 million net less debt $858K = $142,000
What happens when net is $700K (average).
She takes business back and you lose $300K.
Generally speaking, a bank might require about $1.0 million down plus collateral.