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Partner Buyout Financing With A Hard Money Loan

Business Partners Shake On A Deal

Being a business owner can be a great way to earn a living—it can provide you with great opportunities and the ability to be your own boss. When starting a business, bringing in a partner can often make sense. While this can help to reduce risk and allow you to have someone to manage the workload, there could come a time when you need to part ways. In these situations, you will need to complete a business partner buyout. With some advice from NV Capital Corporation in Las Vegas, NV, there are various financing options to consider that can help you buy out your partner.

  • Buyout using cash.
  • Consider bringing on another partner.
  • Raise money with a bank loan.
  • Take out a private money loan.

Use Cash

A clean way to complete a partner buyout is by using cash. By doing this, you’ll avoid taking on debt and can achieve a clean buyout. However, this is not always practical, as partner buyouts can be significant. In addition, there could be more efficient ways to invest and use this cash.

Bring on Another Partner

Another way that you can buy out a partner is by bringing in another one. Sometimes, having a partner is still the best option, although your current one could be a better fit. In these cases, replacing them with a new one could be beneficial. While you will not have full ownership of the business, you could enter into a new partnership agreement that provides you with more control while not having to raise cash.

Get A Bank Loan

A common way to raise money is by getting a partnership buyout loan from a traditional bank. You can get a standard partner buyout financing loan through a bank or the SBA. While this can be an excellent way to raise some money, banks will have a rigid underwriting process that you will need to get through, which can be time-consuming. Further, there are bound to be covenants and agreements you must comply with at all times.

Consider Private Money Loans

Another option for completing a partner buyout is to take out a private loan from a hard money lender. Tangible assets, such as real estate, typically secure hard money loans. Suppose you have business real estate or other personal investments. In this case, you can take out commercial real estate loans to recapitalize the assets and use the cash-out proceeds to complete the buyout. These loans are often preferred as they provide flexible terms and financing arrangements.

We Can Support You Through The Transition

When looking to complete a partner buyout, there are different financing options to consider. Overall, hard money private loans remain a good option as they provide flexibility and the financing you need. If you need to complete a business partner buyout, it doesn’t need to be daunting—we can guide you seamlessly through the process. Contact us today at NV Capital Corporation, in Las Vegas, NV, for more information.

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