Current range for interest rates on seller notes?

by an investor from Yale University - School of Management

4 years ago

We are working on a transaction with a small seller's note.  Wondering how others in this community are setting term and rate given the current credit environment.  Any suggestions or market color much appreciated.  
Jeff

9 likes
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5 comments

searcher

Yes, but keep in mind this is for SBA senior debt.

4 years ago | like reply | 0 likes

searcher

3-6%. Most Sellers do not focus on the interest rate. They usually fall into two camps. 1) How much cash will I see at close because I will probably never see any seller note cash. 2) They value the seller note, but are more focused on getting their note paid off in a short amount of time. If using SBA for senior debt, even the expensive banks are less than 6% interest at the moment. The banks will frown on a seller receiving interest rates higher than what they are receiving.

4 years ago | like reply | 1 like

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