During tough money times, when banks aren't lending, or you don't keep good tax returns on your business that can justify getting a bank to lend, the numbers of buyers able to purchase your business are extremely limited to few unless you make the thoughtful decision to become the banker for a buyer. When one does become the bank, the number of buyers who are able to buy your business significantly increase.
Okay, so you realize your tax returns don't give the buyer what they need to get a loan and you want to sell your business. So the only answer is for you to lend part of the down payment. How much will depend on a number of factors you need to think about. First, how experienced is the buyer? Do they have a track record of success? Do they have good credit? Have they owned a restaurant before? How much working capital will they have after the purchase? What security does the buyer have to give you? Real Estate? These are questions weighing into the final answer of how much you are willing to lend a buyer. The stronger the positive responses, the more you should feel comfortable lending to the buyer.
Second, how much do you believe in your business? The more you believe in it, the more comfortable you ought to feel lending to the buyer, assuming the buyer meets the above criteria to your satisfaction.
Finally, as the owner your concern is to increase the probability of getting paid. First, get a good lawyer who understands securing loans and have him or her structure the loan agreements. A good lawyer will anticipate a default and will structure your deal in a way that will reduce your risks.
Mel Jones is one of the premier restaurant brokers in the nation having published hundreds of articles on buying and selling a restaurant and bar business, selling thousands of restaurants in CA., WA and AZ and building one of the most copied business models in the brokerage industry. Mel started SellingRestaurants in 2004 with the one simple concept, give the buyers the information they need to make intelligent buying decisions without being pestered by a broker or hiding information, prepare the business for market by researching key details that make or break deals and educate the buyer on the buying process to create an intelligent buyer. Prior to SellingRestaurants, Mel was a Chief Financial Officer for Universal Music Group, the largest music company in the world. There he participated in more than $11.5 billion of merger and acquisition transactions. He also work for top companies such as Nestle Foods, USA. He hold a Bachelors in Business Administration Finance as well as attended Law School at Gonzaga University.