I am interested in acquiring a 30 year old manufacturing company. that has yearly cash flow at 650k. The asking price is 2.6mln. I have about 50k in cash. The owner has offered to finance up to 500k. There is NO real estate involved in the deal and the machinery is worth about 1.1mln with a current backlog of about 400k. The business will be delivered free and clear of any debt.
With regards to business acquisition loans. Will a bank or lender accept the 500k as a downpayment? If so where can I find a bank or lending institution to offer this type of product?
Full Version: What qualifies for a down payment.
QUOTE(Irvinecup @ Sep 12 2006, 02:14 PM) 
I am interested in acquiring a 30 year old manufacturing company. that has yearly cash flow at 650k. The asking price is 2.6mln. I have about 50k in cash. The owner has offered to finance up to 500k. There is NO real estate involved in the deal and the machinery is worth about 1.1mln with a current backlog of about 400k. The business will be delivered free and clear of any debt.
With regards to business acquisition loans. Will a bank or lender accept the 500k as a downpayment? If so where can I find a bank or lending institution to offer this type of product?
You can use the 500k as a seller held second--so in essence you will be borrowing 80%. I will accept that as secondary financing in helping you obtain the rest of the money
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