Use a business loan calculator to help sort through different types of loans you can use to finance a business acquisition. There are much small business lenders and commercial mortgage portals where borrowers can submit their deals to different lenders. There are life insurance companies, conduits, credit unions, savings banks (S&Ls), REITs, hard money lenders, SBA lenders, and USDA business and industry specialty lenders. They will make permanent loans, construction loans, bridge loans, SBA loans, USDA B&I loans, mezzanine loans, preferred equity investments, SBA construction loans, and USDA construction loans.

Resources help determine what loan product will best fit your company. Financing an existing business is among the biggest barriers for entrepreneurs and would-be entrepreneurs to acquire a company. Buying an existing business is less risky than starting from scratch. Many of the unknowns are known in an existing business. Customers, vendors, employees, location, and profitability are all known and discoverable in the due diligence process.

By doing adequate due diligence, you have a very good idea of what to expect and how to manage your risk accordingly. Buying an existing business is more expensive than a start-up; however, startups produce zero revenue and have no track record. An existing business has a revenue and cash flow history that makes them bankable.

Business Acquisition Loan Calculator

Different Types of Business Loans

Merchant Cash Advance

Receive up to 200% of monthly credit card processing. Programs range from 3 months to 15 months. No more than 12% of monthly gross sales can be debited, with a minimum of $3,000 in monthly processing required. Merchant must net at least 50% of the current balance. Merchant cash advances don’t build business or personal credit. Minimum of 3 months in business and processing credit cards. Require four months of processing and four months of bank statements.

Unsecured Loan

Receive up to 75% of monthly gross sales. Programs range from 3 months to 18 months. The fixed payment is ACH Monday – Friday, with no weekends or holidays. Minimum $10,000 gross monthly volume required. Merchant must net at least 50% of a current balance. There is a minimum of one month in business to qualify. A minimum of 500 FICO is needed. No more than three negative days and 6 NSFs in the bank. Interest can be written off in business taxes using a 1099-INT form. Apply with four months of processing and four months of bank statements.

Working Capital Loan

Working Capital Loan provides small and mid-size businesses short-term loans available to business owners with low credit scores or other financial issues. The loans are based on the business’s cash flow, not personal credit score. We give 50% -75% or more of what your business is averaging monthly. You can get 100% – 150% or more if you have collateral.

Business Line of Credit

Business Line of Credit helps business owners secure a longer-term loan without penalty for prepayment. The line of credit is based on the equity in any residential or commercial property that you own that has equity. This product is an interest-only payment, allowing you to pay back the loan faster with little cost.

Traditional Loan

The loan amount can range from $100,000 to $2 million with terms from one to five years. The term can be from 1 to 15 years, depending on the purposes of the financing and if real estate is being used as collateral. This loan has a low-interest rate and flexible payment terms.

The Small Business Administration (SBA) Loan Guarantee

Bankable businesses are ones that banks and others will invest in for a reasonable return that is supported by the historical performance of the business. Smart business purchasers use leverage to get the controlling interest in their acquisition. Commercial loans generally fund about 75% of the purchase price, with payments for up to twenty years. Collateral and a personal guarantee are usually part of the deal. Alternative sources are available but will come with higher interest rates and higher costs. The Small Business Administration (SBA) encourages small business lending by guaranteeing 75% of the loan. SBA loans are the best deal you can get if you have the time and can get through the hurdles required.

Alternative Non-Banking Solutions

Other alternative non-banking solutions can loan very quickly but at higher than traditional loans. Always go for traditional loans and SBA loans first. If time or circumstance doesn’t allow the traditional loan sources, there are other lenders, or using you can use your 401(k), 403(b), IRA account or another pension fund. Special rules waive taxation and penalty if you use a specially designed trust to facilitate your business acquisition.

Finding The Best Small Business Lender

You can pursue SBA funding later after acquiring your business using alternative methods. If you desire to own a business or need money for your existing business, we can help. Our lending sources offer merchant cash advances, unsecured loans, lines of credit, invoice factoring, SBA funding, and hard money loans. You can also use retirement funds (401K or ROBS) and other sources for funds. Use our loan calculator for loans from $50,000 to over $5 million to buy a business or expand your company. We have higher approval rates than standard banks with better deals.