When buying a business opportunity that will not include commercial property, borrowers should realize that business loan options will undoubtedly be significantly different when compared to a business purchase that can be acquired with a commercial property loan. This problematic situation occurs due to normal absence of commercial property as collateral for the business enterprise financing when buying a home based business. In terms of arranging the business enterprise loan, efforts to buy a business opportunity are almost always described by commercial borrowers as excessively confusing and difficult.

The comments and suggestions in this report reflect business financing conditions that are frequently provided by substantial lenders willing to give a business loan to buy a small business opportunity throughout almost all of the United States. There are apt to be circumstances in which a seller will privately fund the acquisition of a business opportunity, and it is not our intent to address those business loan possibilities in this report.

BUSINESS OPPORTUNITY BUSINESS LOAN STRATEGIES:

Buying a HOME BASED BUSINESS – Amount of Business Financing to Anticipate

Business financing conditions to get a business opportunity will most likely involve a lower life expectancy amortization period compared to commercial mortgage financing. A maximum term of ten years is typical, and the business loan is likely to require a commercial lease equal to the length of the loan.

BUSINESS OPPORTUNITY BUSINESS LOAN STRATEGIES:

Expected Interest Rate Charges for Buying a Business Opportunity

The likely range to get a business opportunity is 11 to 12 percent in today’s commercial loan interest rate circumstances. This can be a reasonable level for business opportunity borrowing since it is not unusual for a commercial property loan to be in the 10-11 percent area. Because of the insufficient commercial property for lender collateral in a small business opportunity transaction, the price of a business loan to get a business is routinely higher than the cost of a commercial property loan.

HOME BASED BUSINESS BUSINESS LOAN STRATEGIES:

Down Payment Expectations to Buy a Business Opportunity

A typical deposit for business financing to get a small business opportunity is 20 to 25 % depending on the type of business along with other relevant issues. small businesses Some financing from the seller will be seen as helpful by a commercial lender, and seller financing might also decrease the business opportunity deposit requirement.

BUSINESS OPPORTUNITY BUSINESS LOAN STRATEGIES:

Refinancing Alternatives After Investing in a Business Opportunity

A critical commercial loan term to expect when acquiring a business opportunity is that refinancing business opportunity financing will routinely become more problematic compared to the acquisition business loan. You can find presently a few business financing programs being developed that are more likely to improve future business refinancing alternatives. It is of critical importance to arrange the best terms when buying the business and not rely upon home based business refinancing possibilities until these new commercial financing options are finalized.

BUSINESS OPPORTUNITY BUSINESS LOAN STRATEGIES:

Buying a HOME BASED BUSINESS – Lenders to Avoid

The selection of a commercial lender might be the main phase of the business financing process for investing in a business. An equally important task is avoiding lenders that are unable to finalize a commercial loan for buying a business.

Through the elimination of such problem lenders, business borrowers may also be in a better position to avoid a great many other business loan problems typically experienced when buying a business. The proactive approach to avoid problem lenders can have dual benefits since it will contribute to both the long-term financial condition of the business enterprise being acquired and the best success of the commercial loan process.