Hi Guys,
Although I have been reading the posts on this forum for quite some time this will be my first post.I was just wondering if anyone has heard of vendor finance been done with businesses before? Clearly it would not be suitable for alot of businesses but surely it would for some, and you would be able to have a higher interest rate for the higher risk involved.
Just thought i would throw the idea out and see what everyone’s veiw was.
Luckie.
My parents did it a few years ago when selling their business.
You don’t necessarily have to charge a higher interest rate for the risk. They charged slightly less than the banks AAPR for a business loan but was able to sell at full price. A slightly higher interest rate may mean that the buyers will try to discount the price.
Just a thought on how everything is negotiable.
Kevin
I am in the process of purchasing a business on ‘vendor finance’. ie part now, and then the rest in installments with a lump sum in the end.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I thought it was quite common for businesses to be sold in this fashion? So yep, it’s a goer if the buyer/vendor understand and see the benefits to themselves…
Cheers
Mel
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