Real Ownership Scenarios
Scenario 3: Seller Financing Only
No bank involved — the seller is the sole lender.
Practical Explanation
Common for smaller deals (under $500K) or when the buyer doesn't qualify for SBA. Faster close, more flexible terms, but typically requires a larger down payment than SBA and shorter amortization.
Real-World Example
$250,000 service business. Buyer puts $75,000 down. Seller carries $175,000 at 7% over 5 years.
Typical cash required
Typically 25–40% down.
Experience required
Seller's call; usually wants confidence the buyer can run it.
Advantages
- ✓Fast close (30–60 days)
- ✓Flexible terms
- ✓No bank scrutiny
Risks
- !Higher down payment
- !Shorter amortization
- !Seller may take back business on default
Frequently Asked Questions
Best fit?
Smaller deals, motivated sellers, buyers with cash but imperfect credit.
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