Celtic Bank Blog

NOV
13

A Simple Checklist for Closing Your Business Acquisition Loan and Getting Funding Faster


Okay. You’ve applied for a loan, and got all the paperwork done. The appraisal is complete. You get the email: Congratulations—you’re approved! An offer letter is issued, letting you know that you’ve been approved for the loan. Now it’s time to close the loan, and the sale. Trust us. This is one phase you don’t want to do on your own. Make sure you have a legal consultant available to review the paperwork so that things go smoothly. The SBA has published some checklist guidelines to make sure you complete everything necessary to make the transition legally. Check it out, check the boxes, and you’ll be right on your way to closing your business acquisition loan! Before you close: Verify the adjusted purchase price. Take into consideration not only how much the business itself is selling for, but the prorated rent, utilities, and inventory at the time of sale as well. Review required documents. These documents will vary by state (check with your Secretary of State for more information), but should include a corporate resolution approving the sale, evidence the business is in good standing, and any tax releases promised by the seller. Sign the promissory note. In instances where...
Continue reading
NOV
06

Due Diligence and You—When it Comes to Business Acquisitions, it's NOT Just for Your Lender


So you’ve found a business you’d like to buy. You’ve done a basic surface check, and everything looks fine. Now, it’s time to dig deep and make sure everything looks good before you sign the papers. If your business was a used car, this would be the “I’m checking to make sure I’m not buying a lemon” part. In the SBA world, we call this process “due diligence.” Due diligence is the time and effort you and a business broker or other financial advisor take to scrutinize your purchase and determine exactly what you’re getting. It isn’t glamorous; a lot of due diligence consists of double-and-triple-checking paperwork. But it’s worth it. To start the process, you need two forms: the letter of intent , and the confidentiality agreement . The letter of intent outlines the proposed price and purchase terms, as well as the conditions of sale. The confidentiality agreement ensures that you, as the buyer, won’t use the company’s private and financial information for any purpose other than determining whether or not to buy the business. With those in hand, you’re ready to dive into the seven areas of investigative work. One: Financial Start by reviewing the past three...
Continue reading