Seller financing is pretty common in small business sales, and actually increases the buyer’s chances at getting an SBA loan. You might want to ask them to try and obtain an SBA loan to pay more of the purchase price down up front so that you can have less money at risk. The SBA lender will love that you’re willing to put money at risk for the business going forward, and you could get more money now.
Whether that’s an option or not, you can certainly charge a decent interest rate. The typical rate for these seller financing deals is generally between 6 – 10%. The length of time is typically only up to 10 years though, so you may offer a slightly lower rate if you’re extending the terms to 15 years. It’s really all part of the negotiation strategy. You just need to find something that fits for you and works for the buyer.
You can learn more by reading our article on seller financing. Please let us know if you have more questions about that information!