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Finance Center

Financing Your Business Acquisition

Understand your financing options before you make an offer. From SBA loans to seller financing, we break down everything you need to know.

Financing Options

SBA 7(a) Loans

Most Popular

The most common loan for buying a business. Up to $5M, low down payment, long repayment terms.

  • Loan amounts: up to $5 million
  • Down payment: 10–30%
  • Repayment: up to 10 years (25 for real estate)
  • Rates: Prime + 2.25–4.75%
  • Best for: established businesses with 2+ years of financials

SBA 504 Loans

For purchasing commercial real estate or major equipment. Fixed rates, long terms.

  • Loan amounts: up to $5.5 million
  • Down payment: 10%
  • Repayment: 10–25 years
  • Fixed interest rates
  • Best for: commercial real estate acquisition

Seller Financing

Flexible

The seller acts as the bank. Common for smaller deals and shows seller confidence in the business.

  • Typically 10–30% of purchase price
  • Negotiable terms (3–7 years common)
  • Lower closing costs
  • Seller stays invested in success
  • Best for: buyers with limited capital

Acquisition Financing

Conventional bank loans, asset-based lending, and private equity for larger acquisitions.

  • Conventional bank loans (20–30% down)
  • Asset-based lending (collateral-backed)
  • Mezzanine financing for larger deals
  • Private equity / search funds
  • Best for: $1M+ acquisitions

Rollover for Business Startups (ROBS)

No Debt

Use retirement funds (401k, IRA) to buy a business without early withdrawal penalties.

  • Use 401k/IRA tax & penalty-free
  • No loan payments or interest
  • Must set up C-Corp structure
  • Requires compliance specialist
  • Best for: buyers with $50K+ in retirement

Franchise Financing

Specialized financing for franchise purchases. Many lenders have pre-approved franchise brands.

  • SBA loans preferred by many franchisors
  • Franchisor financing programs
  • Equipment financing for buildout
  • Working capital lines of credit
  • Best for: first-time franchise buyers

Resources & Tools

Business Valuation Guide

How to value a business before you buy or sell

View

Due Diligence Checklist

What to review before closing a business purchase

Letter of Intent (LOI) Template

A starting point for your acquisition offer

SBA Loan Calculator

Estimate your monthly payments and total cost

Find a Business Broker

Connect with a licensed broker in your area

View

Find a Business Attorney

Legal help for your acquisition or sale

View

Disclaimer: The information on this page is for educational purposes only and does not constitute financial, legal, or investment advice. Financing terms, rates, and availability vary by lender, borrower qualifications, and market conditions. Always consult with a licensed financial advisor, SBA lender, or business attorney before making any acquisition decisions. BizSource.ai is not a lender and does not provide financing.