Buying a business with a loan: what lenders want to see
Acquisition financing is its own game. The lender is underwriting a business that already exists, which is good news, if you know what they'll scrutinize.
When you buy an operating business, the lender has something a startup can't offer: history. The question shifts from "will this work?" to "will it keep working under you, and is the price sane?"
What they'll dig into
- The target's historical financials, real, verifiable cash flow
- The valuation, are you overpaying?
- Your ability to run it and retain what makes it work
- The transition, customers, staff, key relationships
Your part of the story
Show why you're the right operator, how you'll keep the existing cash flow intact, and that the price is borne out by the numbers. A deal that services its debt on the seller's real results is a lender's comfortable place.
See where your financing file stands
Fifteen questions, four minutes, no documents and no email. You get a readiness stage, the gaps a lender would raise, and the document list for your request.
Check my readiness, freeLenderReady is an educational service, not a lender, broker, or financial advisor. Lending criteria vary by institution and change over time; treat this as a starting point, not a guarantee.