Vet Financing?
May 06, 2024
by a searcher from Rice University - Jesse H. Jones Graduate School of Business in Houston, TX, USA
Hello,
There are a few lenders who will do 100% seller financing for vet clinics along with a few other specialties. Does anyone have experience in using these lenders or have any recommendations?
Thank you!
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA
The SBA 7A loan program, under the new guidance, does allow 100% financing with a minimum of a 10% seller note on full standby for two years of the loan term. However, we are not seeing many lenders employ this. The items provided by Asumaku Suka above sound like internal underwriting requirements for her Bank to get to 100% financing. Those are not SBA requirements. We are finding most lenders are still requiring a minimum of 5% buyer equity even if you have a 10% seller note on full standby for at least 2 years to be sure the buyer has something at risk. The only deals we have seen get done with $0 in buyer equity have been those where a key employee is buying out at owner and the transaction risk is low.
If you have any additional questions you can reach me at any time at redacted Good luck.
from Montclair State University in Odenton, MD, USA
1. Stable EBITDA for past three years at least 1.50 debt service ratio on an adjusted basis
2. key employee who is actively involved in the business and has been in a key role for at least two years and is the purchaser
3. 10% to 20% of purchase price on full standby for at least 24 months
4. Has at least 10% in reserves for post transaction
5. mutiple paid for business is under 3x