Ownership Pathways
Seller Financing Explained
Seller Financing — the owner becomes the lender for part of the price.
Practical Explanation
Seller Financing is one of the core ownership pathways on Business Partner Match™. The seller agrees to receive part of the purchase price over time, secured by a promissory note. It bridges the gap between what banks will lend and what the buyer can put down. On a listing, Seller Financing appears as Yes, No, Partial, or Not Disclosed.
Real-World Example
Seller carries $100,000 of a $500,000 sale at 7% over 5 years; buyer pays the rest via cash + SBA.
Typical cash required
Often 10–25% down on the buyer side.
Experience required
Seller's call; typically wants confidence the buyer can run the business.
Advantages
- ✓Lower cash to close
- ✓Faster close
- ✓Negotiable terms
- ✓Seller stays invested in your success
Risks
- !Personal guarantee on the note
- !Default = seller may take back the business
Frequently Asked Questions
How long do seller notes run?
Typically 3–7 years, sometimes with a balloon at maturity.
What does 'Partial' Seller Financing mean on a listing?
The seller will carry a portion of the price (commonly 10–30%), with the rest funded by a bank loan and the buyer's down payment.
Related guides
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