Business Loan on a purchase of an existing business?

Question

I am looking for loans to finance an existing detailing (26year running) business. Whats for sale is the busienss, business name, equipment, and client el for $27,500. I have some personal credit card debit but my score is pretty good. I don't own anything but a small masonry business currently and 2 vehicles. I would like/think using the established detailing business as collateral would be enough to get a loan?

Any ideas, thoughts, advice?

Answer 1

You could do that, but it also depends on the amount of the loan you need and the bank's valuation of the equipment. If the bank's valuation dept values the equipment at $5,000, you're not going to get a loan anywhere near $27,500. You may have to throw in your equipment from the masonry business as collateral too. Plus they'll probably make you sign a personal guarantee as well.