Hello
My partner and I have found an existing business, specifically a multi-unit food franchise that's consistently been ranked as one of the fastest growing (think Dunkin Donuts, Jimmy Johns, Subway) listed for sale at $1.6MM. There are 4 units total and each has a positive cash flow, with a total owner's net profit of $440k. There is also a general manager in each unit so the business is almost passive. We're currently doing our due diligence and will meet with an accountant and business attorney to determine the health of each unit. If we determine that the business is doing well, then we will purchase it with a 20 percent down payment (160k per person). And from there our main goal will be to improve sales and help the business grow as much as possible.
The loan amount will be $1,280,000, and will be spread out over 10 years. But the problem lies under how we will get the loan (we're interested in either SBA or conventional loans). I have very little assets to use as collateral; specifically, I have $100k equity in a real estate property, a net worth of $450k (this includes the $160k down payment), and my annual income from my full time job is $170k. My partner has $50k equity in real estate, a net worth of $250k (includes the $160k down payment), and makes $150k annually from his full time job.
What are our chances of acquiring the loan? Any advice on how to get the loan?
Thank you
My partner and I have found an existing business, specifically a multi-unit food franchise that's consistently been ranked as one of the fastest growing (think Dunkin Donuts, Jimmy Johns, Subway) listed for sale at $1.6MM. There are 4 units total and each has a positive cash flow, with a total owner's net profit of $440k. There is also a general manager in each unit so the business is almost passive. We're currently doing our due diligence and will meet with an accountant and business attorney to determine the health of each unit. If we determine that the business is doing well, then we will purchase it with a 20 percent down payment (160k per person). And from there our main goal will be to improve sales and help the business grow as much as possible.
The loan amount will be $1,280,000, and will be spread out over 10 years. But the problem lies under how we will get the loan (we're interested in either SBA or conventional loans). I have very little assets to use as collateral; specifically, I have $100k equity in a real estate property, a net worth of $450k (this includes the $160k down payment), and my annual income from my full time job is $170k. My partner has $50k equity in real estate, a net worth of $250k (includes the $160k down payment), and makes $150k annually from his full time job.
What are our chances of acquiring the loan? Any advice on how to get the loan?
Thank you
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