Can a person 100% finance the purchase of a small business?

Public Comments

1. Usually you will need to get a secured loan especially if you are going to finance 100 percent of the purchase. If the business has assets (inventory, equipment, accounts receivable) that are worth a lot then you may be able to convince a bank to use the assets as security. If the company defaults on the loan (doesn't pay the bank back), then the bank will take the assets, sell them and use the cash to pay off the loan. You can also secure the loan with something you own (as opposed to something the business owns). For instance if you own a house and it does not have a mortgage. You can secure the loan with your house (very risky). You may also be able to find an equity investor. An equity investor will give you the cash you need to buy the business, but you will have to give them a percentage of the business.