Non Recourse Lending for $5 million acquisition

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September 06, 2022

by a searcher in Austin, TX, USA

My partners and I are looking to acquire a $5 million dollar business. Who do you know provide non recourse (without personal guarantee) acquisition loans. There will be a seller note and our own money invested as well.


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Reply by a searcher
from Duke University in Virginia Beach, VA, USA
I've heard of people getting non-recourse loans... but this brings up a broader question, and I'm curious regarding people's thoughts on it... It's a bit of a cynical view... But, to what extent is the whole "searchfunder" model predicated on it being a vehicle for non-SBA-qualified investors to realize the benefits of SBA loan programs (which are all "recourse") via an SBA-eligible "searcher"?
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Reply by a lender
from Baylor University in Houston, TX, USA
Banker here. Very tough to do given the deal size, especially in this market. Most likely, Seller Note would need to be on full standby — Interest-Only, subordinated and maturing after the Senior Loan. Also, hopefully this one is fully secured by tangible assets? Send me more details about the deal, if you'd like some quick feedback. Thanks - Grant
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