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Where will you get business acquisition loans and who offers it?
All secured and unsecured business acquisition loans are given by SBA assistance. There are some private lenders who even operate outside the SBA guaranty (example: AEDC - Arcata Economic Development Corporation).
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All banks, government or private, including the top of the line Bank of America has allocated funds specifically for business acquisition loans. You can also approach almost any of the credit unions. Though the SBA assisted loans have similar terms of clauses for eligibility and repayment, they may slightly differ specific to certain institutions. It is wise to study theirs while you are still in the application process.
Repayment terms and interest rates
The usual period of repayment of the loan will not go beyond the normal 10 years. But in cases such as the purchase of the business including real estate, then the term of repayment can be extended. However there is no hard and fast rule as to how longer the relaxation should be but you can take it as somewhere between 10 and 25 years.
Interest rates that apply to business acquisition loans are the same as that of SBA's 7 (a) loan program as long as you are availing SBA loan program loans. It varies from 4.25 % to 4.75 % depending on whether the term of loan is seven years or more. The interest rate decreases for loans of higher amounts.
But watch out for interest rates of private lenders.
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