How To Buy A Business With Little Money Down

There’s no need to reiterate the fact that buying a business is the single best way to start earning real money, fast. Just as we all know that buying a house is the only way to get out of the money drain of rentals, we all know that you can’t earn 7-figure yearly income by pushing a pencil behind a desk for 20 years.

So you’ve been telling yourself for years that as soon as you have the money saved, you’ll invest in your future by purchasing a business. Stop the waiting! You can buy a business today with no money down.

The first step you should take if owning a business without putting down any money is to make sure that your credit is top notch. Request your credit rating online (depending on the state you live in, you should be entitled to one free credit rating a year, at least), and check it over to make sure that there are no mistakes.

If you see a mislabeled or inaccurate portion of your credit history, take the time to send in a written notice of the error, and a request that it be fixed as soon as possible.

Borrowing money, whether it’s for a house, a car, or a no-money down business purchase, is only possible of you have spic and span credit.

Another factor that lenders look at carefully is the net worth of your collateral. Many of the things you own can be put up against a loan, such as your house, and are usually used against the loan at between 70 and 80 percent of their depreciated value.

With a solid business model and some experience in the business that you wish to purchase, you are in a good position to be approved for a business loan. You may even qualify for a sweet, low interest loan guaranteed by the Small Business Administration (this guarantee requires a separate application, but is definitely worth it).

At this point, you should be in a great shape when it comes to securing a small business loan. If you can find a short term investor to provide additional equity in the form of 10-20% of the loan you are requesting to buy your business, you should be able to purchase your business with no personal financial interest (except for your collateral, which will only come into play if you are unable to repay the loan).