How to sell your business through owner financing

Transcript: Hey guys so Tomo this week wants to know what is the collateral for the vendor financing note when you buy a business hey there everyone it's a David Barnett from David C Barnett calm the blog site YouTube channel iTunes and SoundCloud podcast where I talk about buying selling financing and managing medium and small businesses I just got back from an amazing vacation went and visited Croatia as well as Montenegro with my girlfriend Natalie it was a sort of a business trip for her and I got to tag along and I just want to give a big shout out to everyone out there who's watching who are in the Balkans I had no idea I had so many subscribers in that part of the world and it was great to hear from you guys so Sasha dragon Masha Mira and of course Tomo who sent in a question this week thanks so much for the hospitality it was a beautiful part of the world and I'm a big history buff so seeing all that old stuff from the Romans the Venetians different you know periods of history over the last few thousand years was amazing I... See more →

Key quotes:

• "It could make a lot of sense to sell using owner financing."
• "Choosing a rent to own structure is often overlooked by those looking for a solution for their need to sell property."
• "However, things are much different in a situation where you have owner financed a home."
• "Some people may have been rejected by the bank for a mortgage, but are still perfectly capable of making monthly payments on time consistently There are a of variables that can hurt a person’s chances of getting financing from a bank."
• "If you sell your house by way of owner financing you are solving problems for yourself and assisting another person to achieve their goal of owning a home."
• "It is important to realize that if the buyer was unable to get the money together or a traditional mortgage down payment, then they will not be able to pay that much to you whether."

Transcript: So how exactly would one go about buying a business with no money hi there everyone it's david barnett from investlocalbook.com the blog site and youtube channel where i talk about buying and selling small businesses local investing personal finance and business management and anything else that people want to ask me questions about I have been watching for some time now videos on YouTube talking about buying businesses with no money and I've also gotten several questions over the course of the last year or two from people who want to know how they can put a business deal together to buy a company with no money or people who've been offered businesses for no money and they want some advice on those and I thought maybe now is the time to actually create a buy a business with no money video but mine's going to be a little bit different from well the all the other ones you can find online because I'm going to put a little bit of intelligence and common sense into this video so first of all what exactly do we mean by buying a business with no money does that mean you don't... See more →

Transcript: Hey what's going on guys it's Sam co-op one of the coop brothers real estate investors and today I'm gonna show you how Danny and I generally negotiate and find owner financing deals now this is very exciting because this is actually our first time showing you guys some of our secrets online YouTube and Facebook so I was kind of worried at first because I'm gonna be sharing some of our secrets and is what makes us competitive as real estate investors and how we negotiate for deals so in a general sense I'm not gonna share everything but I wish to share some big picture information that's gonna help you definitely now if you want some of the details and some of the more juicy stuff I'm gonna leave some links and resources down below the links section below if you're watching this on Facebook you'll see it up top I'm gonna leave the cheat sheet right our owner financing cheat sheet guy you guys can download that for absolutely free where we have a owner financing calculator it's gonna show you and help you determine if what you're dealing with is a good deal or not a... See more →

Key quotes:

• "And if you’re the owner of an SME and considering a sale in the near future, there’s no reason you can’t sell your business without a banker."
• "Before deciding to sell a business without an investment bank, it’s useful to understand the role that the banker plays when representing a seller in a transaction."
• "And if you do hire a banker, they’ll still need to spend time with you to better understand the dynamics of your business which only you can know."
• "Bankers unquestionably generate value for business owners in the preparation of sales memorandums for businesses."
• "As well as an extensive network of contacts that could be suitable acquirers, a good banker will intuitively know who will be interested in your business."
• "You may need to call in an accountant for some assistance here but having come all this way, you’ll be a lot more comfortable and acquainted with the process of selling your business without a banker."

Key quotes:

• "In my 30+ years of experience serving in the roles of president, CFO, principal investor, investment banker, consultant, and operating turnaround expert, I’ve improved the operating performance of ten businesses and completed 27 M&A, investment, and financing transactions totaling $1.3 billion."
• "Based on this experience, in this article, I describe common reasons deals fail, and I outline what an owner can do to drive a better outcome."
• "My advice on how to sell your business boils down to (1) take the time and do the work to prepare for an exit transaction and (2) apply “intelligent greed” to close your best deal."
• "An interim CFO can help you boost company performance, prepare for the sale process, understand your valuation range, and target and analyze potential buyers you might not have considered."
• "First, you, the owner, need to overcome your natural trepidation and apply the same determination to sell the business that you applied to build it."

Key quotes:

• "Unfortunately, there exists a kind of real estate market where a real estate investor can find great investment properties but will have trouble getting a mortgage."
• "Many real estate investors use the full cash payment from closing on a house with a traditional home mortgage to purchase their next investment property in the real estate market."
• "Real estate investors buying a home often don’t consider seller financing simply because they could end up paying more money for an investment property through higher interest rates or asking price."
• "If the investment property is sold with owner financing, the mortgage lender will require the payment."
• "For these reasons, many don’t consider seller financing as an alternative way to finance investment properties when selling or buying a home."
• "There are many ways in which a real estate investor can benefit from selling a home with owner financing."

Key quotes:

• "Could this investment property financing method be the best for real estate investors, or is it just too complicated? In real estate investing, the most common way among property investors for financing the purchase of an income property is through a traditional mortgage loan."
• "When going with a traditional mortgage loan, real estate investors typically have a 15–30-year amortization to pay off the investment properties."
• "As a real estate investor buying an income property with owner financing, you must pay off any remaining balance — whether with cash or by getting a new loan."
• "They place a lien on investment properties and provide security for the seller in case the real estate investor defaulted on payments."
• "Based on the terms of owner financing, you can see that they offer benefits to both the seller and buyer of the investment property."
• "So, is owner financing the best way for real estate investors to finance investment properties or is it just too complicated and risky?."