Consult With Your Lender Before Negotiations to Get the Best Financing Terms

Consult With Your Lender Before Negotiations to Get the Best Financing Terms

Consult With Your Lender Before Negotiations to Get the Best Financing Terms

If you are actively seeking to grow your financial advisor practice through acquisition, you may be interested in a loan from a bank. But how can you properly structure an acquisition deal to get the most favorable bank financing? Your purchase agreement can not only affect the terms of your loan, but the ability of a bank to approve the deal.
By reaching out to a Salt Creek Loan Advisor before you enter into negotiations, you can learn how deal structure can influence risk factors that bank lenders consider when reviewing the credit decision.

Why Should You Involve a Loan Advisor In Negotiations?

Coming to an agreement on purchasing a financial advisor practice is difficult at best. A good goal when negotiating a purchase agreement should be to find a deal structure that works for both buyer and seller, but is also “bankable”.

Going through rounds of negotiations, only to find out that there is a condition in the purchase agreement that hinders the financing terms, or worse yet, renders the deal ineligible for financing, can cause unneeded delays and frustrations. Our loan advisors can go over common pitfalls that influence bank financing when purchasing a financial advisor practice.

Which Factors Should Be Considered During Negotiations?

In recent years, the percentage of deals that use outside bank financing (and do not rely entirely on seller financing) has increased significantly. However, including a portion of the purchase price on seller note is still a preferred option for most bank lenders.

Not including a seller-note increases risk for both bank and buyer, and unfortunately when risk increases, normally the cost of financing also increases. A seller note can help lower the cost of your loan and help align the interests of both buyer and seller.

Our loan advisors can help you better understand how seller notes and various other factors can influence a bank loan offering. Contact us today to learn more how seeking lender consultation can help you successfully structure a financial advisor acquisition so it is win-win-win.

Get Prequalified in Just 48 Hours

Our goal is to offer potential borrowers a pre-qualification determination within 48 hours of receiving a completed loan application. To get started, contact us today or download our financial advisor loan application now. Then, speak with a loan advisor or send the completed application using our secure document portal. Call us anytime with questions at (402) 858-1249.