You’ve found a business that you want to buy. Now it’s time to think about how you’ll finance this purchase. We discuss how to get a loan to buy a business and the alternative funding options to consider.
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When you’re looking to build a successful business, there’s no rule saying you have to start it from scratch. In fact, buying an existing business can be a smart and efficient way to enter the market. It offers numerous advantages, such as an established customer base, existing cash flow, and proven business models. And if you have the right experience, you may be able to get a business loan to buy an existing business.
Immediate Revenue: Start generating income from day one with an established customer base.
Proven Success: Benefit from a business model that has already been tested and refined.
Existing Relationships: Leverage existing supplier and customer relationships.
Lower Risk: Reduce the uncertainty and risk compared to starting a new business from scratch.
The simple answer is yes. Most traditional banks and alternative funding providers like iwoca are open to lending money to buy a business, depending on the circumstances of the purchase.
Given that buying a business is a risky proposition, lenders may be more stringent in their requirements, such as providing collateral or asking to see a business plan.
Depending on your situation, there are a range of financing options you can use to buy a business.
Funding a business purchase with a secured loan or unsecured loan is a common choice for owners that are looking to acquire a second company and need to generate funds to finance the purchase.
With an iwoca Flexi-Loan, you can borrow up to £1,000,000 with repayments from 1 day up to two years. You can get a decision within one day - with our record standing at 2 minutes and 37 seconds from application to money in the account.
Seller Financing this is a type of loan where the seller provides a loan to the buyer to purchase property, usually requiring a down payment which is followed by monthly instalments.
Asset finance can also involve using your current business assets as collateral to secure a loan for purchasing a new business, like a secured loan. By leveraging the value of your existing equipment, machinery, or vehicles, you can obtain the necessary funds without impacting your cash flow.
The type of loans that you explore will depend on several factors such as how much money you need to borrow, your personal or business credit score, repayment terms, and more.
The application process for a loan to buy a business is similar to other types of loans. Some of the steps that you may want to take include:
An iwoca Flexi-Loan is a flexible, fast route to accessing the capital you need for your business purchase. You can borrow up to £1,000,000 for as little as 1 day up to two years. Get a decision within one day, with funds in your account in hours.
You may also want to consider alternative funding options to finance the purchase of a new business. Some of these may include higher fees or collateral, so it’s important to do your research. Alternative options include::
You’ve found a business that you want to buy. Now it’s time to think about how you’ll finance this purchase. We discuss how to get a loan to buy a business and the alternative funding options to consider.
