When people think about buying a business, they usually think about two sources of money: their own cash and a bank loan. Seller financing rarely makes the shortlist. It should. In a seller-financed deal, the owner agrees to accept part of the purchase price over time, instead of all of it at closing. It's more common in small business acquisitions than most first-time searchers realize. Why it matters for buyers: → It reduces the amount of outside capital you need to raise
→ It signals the seller believes the business will keep performing after they leave → It naturally keeps the seller invested in a smooth transition → It can make an SBA loan easier to structure, since many lenders view seller notes favourably Why sellers agree to it: → It can get them a better overall price than an all-cash offer → Tax treatment is often more favorable when payments are spread out → It's a way to test the buyer's ability to run the business before fully walking away It's not free money, though. It usually comes with real terms: → Interest rates, though typically softer than bank debt → A repayment schedule the business needs to support post-close → Sometimes a seller's note that's subordinate to the bank loan The searchers who negotiate this well don't treat it as an afterthought. They bring it up early, understand what the seller actually needs, and structure it as part of the deal from the start rather than a fallback if financing falls short. Curious to hear from the community: has seller financing come up in your deals, and how did you approach structuring it?