One concern that many clients have is whether or not they have to pledge their home as collateral for a business acquisition. The answer to this question can vary depending on many elements of the business acquisition. If you apply for a loan through the SBA (Small Business Administration), you will not typically have to pledge your home as collateral if your home’s equity is less than 25% of market value.
If the business being acquired does not have the ability to work with the SBA, they can utilize asset-based loans or cash flow loans. These loans are short term loans that allow financial flexibility for businesses recovering from company changes, expansions or mergers and acquisitions.
For further assistance, schedule a no cost - no obligation confidential consulation with George & Company today.