Deal under LOI - Senior Loan

May 30, 2023

by a searcher in Miami, FL, USA

Hello everyone,

I wanted to reach out to the community as I have a deal under LOI, and the opportunity requires approximately $3.5 million in debt financing. However, as a foreign national, I am unable to qualify for the SBA 7a loan program. Therefore, I am seeking valuable insights from you as I need to explore alternative options for the senior piece.

Being in this unique situation, I understand that I need to think outside the box and get creative when securing the necessary financing. I would greatly appreciate any advice or recommendations you can offer based on your experiences or knowledge in the field. Whether it's alternative lending sources, strategies for approaching lenders, or any other suggestions, your input would be invaluable to me.

I am determined to find the right financing solution that aligns with the needs of this deal. I believe that by tapping into this community's collective wisdom and expertise, I can gain valuable insights that will help me in this process. Thank you all in advance for your support and contributions.

p.s. I have chosen to post anonymously to avoid any potential misinterpretation or confusion with the broker (part of searchfunder) and/or seller.

Reply by a lender
from Clemson University in Reston, VA, USA

It’s really going to depend on the industry. Some are hot and some no one is lending in right now. As long as you are a resident and have something to tie you to the states have debt instruments like a mortgage or credit card it’s not difficult to find a lender. Also you may be required to add a credit enhancement line an assignment of contracts or assignment of life insurance that mitigates the risk. Think of all of the cons and see where you can help create a solution. If you can get more money into deal with either cash or seller rollover, or earn ours or seller notes these are all positive ways to help your application.

Reply by an intermediary
from University of Toronto in Toronto, ON, Canada

Part of any process to find a lender starts with a strategic lending review, form an understanding of what it would take to gain the premise for a lender's interest on all the elements, and then lastly approaching lenders. In my experience, ideally you wouldn't start with the actual lender search until you've figured out your most likely approach(es). You can always canvas the market once ready. Feel free to email me: redacted

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