How to Choose Between Lump Sum and Financing

When selling a business, you might be expecting to get one big payment for your company. But there are actually two main strategies that buyers rely on to pay for a company: lump sums and financing.

With a lump sum, the seller receives payment in full for the company before handing over control. With financing, however, the buyer makes regular payments for the company after taking control, effectively putting you in the position of a lender. Choosing between these two options can make or break a deal.

Choosing Between Lump Sums and Financing

The decision between a lump sum and financing the purchase of your business can be a difficult question for many sellers. Kumi Bradshaw provides help with appraising businesses for sale and completing the sale process. Bradshaw describes the situation and potential problem:

To read the rest of this article by Thursday Bram, a writer for Wise Bread, a personal finance community, please go to http://bit.ly/bnKKVY.

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