Creative financing

I have found a great deal. I am looking at buying a local restaurant. The asking price is $85,900. It has seating for 72 people. It also has a 2 bedroom and a 1 bedroom apartment above that goes with the restaurant. The current owner wants to retire. I need to figure out some creative financing options here. This isn’s something that I want to pass up. My credit is poor, so I can’t get a conventional loan. So, if anyone knows of any creative financing techniques, it would be greatly appreciated.

It is easier to refinance then to get an initial purchase. With commercial property purchases you need money down, but with a refy you don’t put money down if you have equity in the property. So…

You tell the owner that you want 100% seller financing. Then in 12 months you will refinance and pay him off in full. If your credit is poor then you may want to do a loan amortized over 30 years with a 5 year balloon from the seller. This will give you 5 years to refinance.

100% seller assist is the only way you are going to get this done—you will not find any lenders willing to put up a high LTV loan on this property type and your FICO will be a consideration.

BTW, do you have any background in operating a restaurant business? Restaurants have an excessively high failure rate and unless you have either the experience or management in place, I caution you to reconsider.


Scott Miller

Thank you both for replying to my post. It helps out greatly. Yes, I have restaurant and managerial experience. So, that will also help things out too. And, if there is anyone else out there with anymore ideas, please feel free to leave them. Thanks.