Below are the most often asked questions we get from potential buyers

Q.  Can I buy a business with no money down?   A. Not likely.   It doesn't matter if you use seller financing or apply for a SBA loan, both will require a down payment.  The down payment required will generally be around 20% - 30%.  The minimum on a very small business will be about $10,000.  The down payment ensures the seller or the bank that you are committed to the business.  The sellers also have fees associated with selling.  At the time of transfer the sellers income from the business stops and they may have to cover expenses incurred prior to the sale such as invoices, payroll, utilities, rent, and broker fees.

Q. I have $10,000 to invest, can I buy a business that will provide a net income of $40,000 - $50,000?   A. Again not likely. This depends on the motivation of the seller, but a business with a profit of $50,000 would be worth over $100,000 resulting in a down payment around $30,000.

Q. Where can I get financing?  A. Most of the businesses we sell are financed by the seller, but you will need a down payment. Some people acquire the down payment by applying for a personal loan or home equity loan. There are many banks, and now even credit unions, that offer SBA loans. See Financing.

Q. Aren't there government grants I can get to buy a business?   A. I am not fully knowledgeable on the government grant programs. While SBA does offer some grant programs, these are generally designed to expand and enhance organizations that provide small business management, technical, or financial assistance. These grants generally support non-profit organizations, intermediary lending institutions, and state and local governments. You can research more about grants at http://www.sba.gov/services/financialassistance/grants/index.html

Q. Can I have copies of all tax, payroll and financial records before writing an offer?  A. Not until your offer is accepted.  Sellers are not comfortable with showing you all the fine details of their business records until you have written an offer with an earnest money deposit.  You will be given sufficient information from our office and from visiting with the seller to decide on making an offer.  You can have a contingency in the offer so that once your offer is accepted you can ask the seller to provide any information that is necessary to verify the validity of the business (this is called Due Diligence). If you are not satisfied with the information provided, the offer can be withdrawn and your earnest money returned to you.

Q. Can I work in the business for training before buying?   A. No. When this was tried in the past, the buyers began to work in the business as though they already owned it. This does not go over well with the sellers. Remember, the business is not yours until the day of possession. On the day of possession the seller will be obligated to provide you training with an agreed amount of hours. The most common training is 40 hours in two weeks.