by: Peter Siegel
80% of all business buyers never end up buying a business! Many factors contribute to this statistic, but by following the points below, you should be successful in locating and buying a business that interests you and completing the transaction!
Know The Types/Sizes/Locations Of Businesses You Want To Buy
Before you start calling/contacting business brokers, owner/sellers, and agents make sure you know what types, sizes, and locations of businesses you are looking to buy. Make sure you post a request by calling the www.USABizMart customer support staff - this is a great way of getting the word out quickly and efficiently to all parties selling businesses. If you seem uncertain about your search criteria, brokers and agents will not spend a lot of time with you. There are many more buyers than sellers on the market and brokers/agents and owner/sellers like to work with buyers, who are serious, motivated, and know what they are looking for. Have available and send/fax/email to potential sellers and brokers/agents an Acquisition Criteria sheet that goes over your current search criteria ? it pays off and shows you're serious!
Know How Much Money You Are Willing To Put Down
When buying a business you need to know how much money you are willing to spend on a down payment for a business. Most of the time you will be putting down 30-100% down to buy a business. Depending on the amount of money your willing to put down determines the size of business you are able to purchase. Also know in advance if you would be willing to pledge the collateral in any real estate you own for a note the seller may be taking back in the deal ? this will save you a lot of time in the search process and in negotiations.
Know Where The Down Payment/Purchase Money Will Come From
Money for a down payment or purchase can come from many different sources. They are: cash on hand in savings, pulling equity out of your home, your retirement funds, SBA loans, seller financing/note. Knowing where and what you are willing to do upfront will save you a lot of time in the search process. You definitely want to get pre-approved/reviewed for SBA loan and other financing options before you write any offers ? you need to know what your financing opportunities are early in the process of buying!
Get Pre Qualified/Reviewed For Financing ? Leverage That Purchase
Getting Pre-Qualified/reviewed for financing by lenders is very important since many businesses want all cash for their business. With financing you only have to put down 20%-30% and you can get financing for the rest of the purchase. You will need to submit personal financial info and a work/management resume. In most cases depending on the size and type of businesses you are looking to purchase they can tell you if you would be able to get a loan to finance a business purchase. For more business purchase financing tips and info go to: www.bizbuyfinancing.com
Keep The Negotiating & Communications Moving Forward!
Remember - TIME KILLS DEALS. Make sure when you are negotiating the contract, allocation of purchase price, new or restructured lease, etc. always be moving forward. Don't let any situation sit too long - it will most likely kill the deal!
Confidentiality Agreements Are Important
To view or get any detailed information on any businesses for sale you will probably need to sign a confidentiality agreement. Respect this part of the process and keep the sale of all businesses confidential. There are also legal ramifications if it is traced back to you that you were the one who leaked the word that the business was for sale!
Have Your Professionals Lined Up Before You Sign A Contract
You will be utilizing many professionals to buy a business. Make sure you have a CPA or Due Diligence Consultant to help you look at the financials and paperwork of the business to make sure it is in order. You will also possible need financing (a loan for the purchase), escrow services, an attorney to review contracts and possible other services to assist you in the buying of your business.
Make An Offer If You Like A Business! ? Get The Process Started!
A majority of business buyers are too timid when buying a business and are not willing to "pull the trigger" and sign a purchase agreement to start the process of buying a business. Many serious buyers lose out on great deals because they're too analytical or pensive about writing up an offer. Writing up an offer also usually "locks out" other potential buyers (your competition) for a period of time so you can take a look at important business records and info. After signing the purchase agreement there will be a Due Diligence period with contingencies that will have to be met before the deal is closed. If those contingencies are not met or the books and records are not exactly as represented you are in most instances able to pull out of the deal and go on searching for other businesses - make sure you have all contracts/agreements reviewed by an attorney before signing.
Get The Signed Purchase Agreement Into Escrow
Get the signed purchase agreement into escrow immediately (there is a list of excellent Escrow Companies on www.USABizMart.com) and sign off any contingencies as they are removed- remember TIME KILLS DEALS. Make sure you go through the Allocation of Purchase Price in the beginning of the escrow process not at the end which happens most of the time. By getting into the escrow process usually takes the deal out of play and out of reach for other potential buyers.
Keep The Escrow Moving Forward At All Times!
On good businesses for sale there will probably be multiple offers to buy the business - even when it goes into escrow there will be potential buyers who will want to "get in line in case things bog down". You want to make sure you move the process along so that you aren't perceived as getting second thoughts about buying the business! Open communications, setting expectations and keeping things on schedule gets deals to close smoothly.
About The Author
Peter Siegel is author of the book "Businesses For Sale - How To Buy Or Sell A Small Business! A Guide For Business Buyers, Business Owners, & Business Brokers". Visit his website www.usabizmart.com to search a listing of US businesses for sale and www.bizbuyfinancing.com for small business loan information.
|
Credit Card Debt
Credit Card Debt
by: Jeanette Joy Fisher
If you can't sleep at night because of credit card debt worries, you're not alone. Many people get in over their heads charging things they think they can't live without.
You don't need to cut up all of your credit cards. Save your major bank cards, but stop charging needless temptations on them. You need a couple of major bank credit cards to maintain or build strong credit scores.
The credit cards you should cut up, department store credit cards, cost you too much in interest. Plus, these types of credit cards lower your credit scores. When mortgage lenders compute your credit worthiness for real estate financing, they deduct points for unfavorable department store credit lines.
Here are a few things you shouldn't charge on your credit cards:
1. Gasoline. Why charge something that gets burned up before you pay for it? Think about how much per gallon you pay when you pay interest. ...
Credit Card Debt
Financing > Credit Card Debt
Locating a Down payment
Locating a Down payment
by: Jennifer Hershey
If you are a saver, and many of you are, than the need to locate a down payment will not be an issue for you.
But there are also many of us out there that have not had the luxury to save as much as we would have liked for various reasons. With this challenge at hand, we will need to track down a source for a down payment.
If you have excellent credit, and when I say excellent, I mean your credit history is perfect without a blemish on it, you will most likely be able to apply for a mortgage with 100% financing, if you choose to go that route.
A lot of lenders offer this product, and if you can swing it, than you won?t need to come up with any cash for a down payment, and you will only be responsible for closing costs.
If you are unable to go with 100% financing, here are a few ideas you might look into to come up with a down payment.
Retirement Plans
If your employer...
Locating a Down payment
Financing > Locating a Down payment
A Guide to Bad Credit Finance Options
A Guide to Bad Credit Finance Options
by: John Mussi
Have you been trying to find out what bad credit finance options were available? Perhaps you're in the market for a new car or truck, but aren't sure if you can find a dealer or lender who'll offer you a bad credit finance?
You shouldn't worry too much about bad credit finance options, because there are several financing options available regardless of your credit history? some of them charge higher interest rates or require some additional security, but in the end may be just what you're looking for.
Vehicle financing
If you're looking for a bad credit finance for a new or used vehicle, your best option is most likely going to be to visit a finance company as opposed to a traditional bank.
Some finance companies are more likely to offer bad credit finance options for vehicles than others, and the financing will usually depend upon the type of vehicle being financed, where...
A Guide to Bad Credit Finance Options
Financing > A Guide to Bad Credit Finance Options
Venture Capital - What Happens After The Due Diligence Process
Venture Capital - What Happens After The Due Diligence Process
by: Evan Carmichael
If the venture capitalists are interested in your company after completing their due diligence, they will offer a binding term sheet. It will reflect the draft term sheet that has already been agreed to but this one will be a legal contractual agreement. Then the real negotiations start.
There are different types of financing to consider: debt, equity, and mezzanine.
Debt financing is the most objective and is therefore the easiest to negotiate. If you have the assets to support the debt and the income to support the interest payments, the negotiation period will be very short.
Equity financing negotiating is more complicated and revolves around agreeing on valuation and percentage ownership. Discussions usually requires several days.
Mezzanine financing involves a mix of equity, debt, convertible debentures and preferred shares. Negotiating the...
Venture Capital - What Happens After The Due Diligence Process
Financing > Venture Capital - What Happens After The Due Diligence Process
Where to Look for Business Financing
Where to Look for Business Financing
by: John Mussi
Starting a new business can be difficult? in addition to creating a business plan that will outline what your business intent is and finding the contacts and locations that you'll need, finding the money that is needed to get a business off of the ground can sometimes seem impossible.
If you're not exactly sure how to get the money that you need, you'll find several suggestions below.
From information about traditional bank loans to finding investors, you're sure to find something that helps you to get on the right track toward the money that you need.
Bank Loans
The first stop for many potential business owners is their local bank. Many banks offer loans for startup businesses, though the process for applying for a business loan from a bank tends to be a bit more in-depth? after all, they want to make sure that your business plan is solid and that they'll get their money...
Where to Look for Business Financing
Financing > Where to Look for Business Financing
Subprime Mortgages And A Past Bankruptcy
Subprime Mortgages And A Past Bankruptcy
by: Carrie Reeder
Even with a Chapter 7 bankruptcy in your credit report you can still qualify for a sub-prime mortgage. Once approved, you can then use your mortgage to improve your credit history, qualifying you for lower interest rates in the future.
The Effects of a Bankruptcy
A bankruptcy will affect your credit score based on how long ago it was. So a bankruptcy discharged less than a year ago will qualify you for a D loan. These types of loans usually require 30% down and a high interest rate.
By waiting a year after a bankruptcy, you can qualify for a B or C loan with their lower rates and down payment requirements. If you wait two years, you can qualify for a FHA home loan. In four years, you can qualify for a conventional loan.
Besides your bankruptcy record, financing companies will want to see a steady payment history. This includes your credit and rent payments. Cash reserves...
Subprime Mortgages And A Past Bankruptcy
Financing > Subprime Mortgages And A Past Bankruptcy
Bad Credit Home Financing - Choosing A Subprime Mortgage Lender
Bad Credit Home Financing - Choosing A Subprime Mortgage Lender
by: Carrie Reeder
In the early nineties subprime mortgages accounted for about five percent of all mortgages. Today the subprime mortgage loan sector comprises more than twenty percent of the mortgage market. With this explosion of subprime mortgage lenders and brokers, it is important to know what to look for when choosing your lender. Not only do you want to be sure that you are getting the best deal possible for your subprime mortgage, you also want to know how to avoid falling prey to a predatory lender.
What makes a person a candidate for a subprime mortgage? Bad credit is the predominant reason but there are others. Fluctuating income and even the type of property being purchased can also necessitate an unconventional mortgage. If your unique situation requires a subprime mortgage do the following when choosing your loan agent or broker.
Know your credit history, particularly...
Bad Credit Home Financing - Choosing A Subprime Mortgage Lender
Financing > Bad Credit Home Financing - Choosing A Subprime Mortgage Lender
Financing
This page loaded in 0.02819 seconds.