We’re going under LOI for a 10-year-old, home-based service business with strong margins (just under 40%) and an attractive price at 2.4x. While the business has solid revenue and contracts in place for future events, the biggest hurdle is messy books due to the seller’s approach (lack of knowledge) to bookkeeping.


The Challenge:
The owner has been transparent about running a lot of personal expenses through the business because it is home-based—home and car insurance, personal cell phones, home office repairs, "business trips," etc. While most of these add-backs are documented (receipts, credit card statements), they make up nearly $250K of the $300K SDE. Given this, I’m concerned about SBA lender willingness to accept these add-backs.

Proposed Deal Structure:
Price: $727K
Buyer Cash: 10%
Seller Financing: 10% (2-year balloon)
SBA Loan: 80%

Key Timing Issue:
We’re hoping to close around May 1st to capitalize on several large contracts booked for early May. Speed is important.

Looking for Advice On:
1. SBA Lenders Who Will Work with Messy Books – Any banks or lenders known for being flexible and aggressive with add-backs?

2. Alternative Financing Strategies – If SBA proves too difficult, what other creative financing options have worked for you?

3. Experience Closing Deals with Similar Financials – Any insights from those who’ve navigated acquisitions where the books needed some “cleaning up” for financing approval?

Appreciate any insights, lender referrals, or strategies that could help get this deal across the finish line