CRE contract assignment to fund SBA down payment

searcher profile

October 03, 2023

by a searcher in Ocala, FL, USA

Hey everyone!

I am trying to figure out the following deal and wanted input from the community on how to go about it..

Business $3M Real Estate $1M Real estate valuation $2M with 7% cap rate $500k working capital Location: South Florida

My thoughts are I can assign the real estate purchase agreement and collect an assignment fee of $1M minus transaction costs. Use the proceeds to fund SBA 7a down payment. Deal structure 80/10/10 plus working capital.

I appreciate everyone’s input!

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commentor profile
Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA
Alex, thank you for posting. If I am reading this right it looks like you plan to buy and turn around and flip the real estate and then use that as your equity down payment.? If that is the case I do not think that will work as your down payment for an SBA loan. They are going to view that real estate as part of the transaction and look for your verified equity before you enter into the transaction. I would be happy to have a discussion if you would like. You can reach me at redacted Good luck.
commentor profile
Reply by a searcher
in Ocala, FL, USA
Brad, I will reach out. Thanks!
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