Is Seller Financing Right For Your Business Sale?

In BizBuySell’s 2014 nationwide survey of business brokers, nearly half said that over 60 percent of their closed sales included seller financing. Business owners are often reluctant to offer seller financing when it comes time to sell their business. But in our many years of business brokerage, we have seen positive results for both the seller and buyer when seller financing is offered.

Often potential buyers don’t have the cash on hand, are reluctant to use all of their capital, or are unable to borrow the money. In these cases, it’s obvious why seller financing would benefit the buyer. But what’s in it for the seller? Sellers often have concerns that buyers will be unsuccessful at running the business. In our experience, a carefully crafted deal with the help of an experienced business broker can offer protection for the seller and other advantages as well. Following are 5 key reasons to consider seller financing.

  1. Seller financing shows potential buyers that the seller is confident the business will continue to be successful.
  2. Offering seller financing opens the sale up to a larger number of potential buyers and can result in a faster sale.
  3. Seller financing allows business owners to set a higher sale price. Studies reveal that, on average, a seller who sells for all cash receives only about 80 percent of the asking price.  Sellers who are willing to accept terms receive, on average, 86 percent of the asking price.
  4. Seller financing can result in a faster sale because loans clear faster than with commercial lending.
  5. Interest profits from seller financing helps former owners spread out taxable income over time vs. a cash sale.

Business brokers have long been aware that reasonable terms are necessary if sellers are serious about selling their businesses. At Regal Consulting Corp., our professional team of business brokers has years of experience helping clients sell businesses in New Jersey, Pennsylvania, New York, and Connecticut. Our expertise, integrity, and marketing tools ensure we price your business appropriately, identify a qualified buyer, and close the deal. Call us today and we can begin with a thorough business valuation and exit plan.


Regal Consulting Corp. – Serving New Jersey, Pennsylvania, New York, and Connecticut