Business Notes

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Business Note is a promissory note secured by a business.

Description:

Business Notes are created when business owner sells a business using owner financing.  A business note is similar to a private mortgage note.

The difference is that business note is secured by a business rather than

by real estate.

Benefits of Business Notes:

Purchase a small business with a bank loan is very difficult because:

-businesses have historically high failure rate

-many businesses do not own enough collateral to secure a bank loan

-business sellers usually have no choice but to offer financing

-the sellers and buyers accept cash down payment for part of the sale

and promissory note for the rest

About 85 percent of all business sales involve seller financing in the United States.  Most businesses use business notes when the owner sells a business to the buyer.