Should You Pledge Home Equity with the SBA When Buying a Business?

Intro Voice Over (: 00:02

Welcome, where business buying banter meets no BS reality. Get ready to dive into the world of buying and selling businesses without the fluff and fancy jargon. Whether you're a seasoned business buying pro or a curious aspiring entrepreneur, this is where the real talk happens. Because in business, there's no room for sugarcoating. Let's get down to the brass tacks.

Deb Curtis (: 00:37

Hello, are you ready? It's show time. Richard. Hello there. How are you? I'm doing great. I, um, I was listening to our opening little, little jiggy jig there. The, you know, the no bull shit business buying banter beep. I probably need a beep on that one. You know what I was thinking? We're going to give it to our audience. Like we do the no BS and

Right before show time, we were talking about searchers. Can we not deliver the BS there as well? I mean, it's changing. The landscape is changing, Richard. It's getting unbelievably crowded. That's part of the problem. The industry has always been rampant with a massive failure rate, meaning the amount of people that look to buy a business that actually completed transactions has always been over 90%. Numbers,

gone higher now, it's about 94. And there's a lot more people in the space. On the one hand, it's wonderful because personally, I love to see as many people as possible become entrepreneurs. The flip side of it is really this proliferation of bad information, misinformation and outright lies that really suck people in thinking that they can make acquisitions when they have no money.

no track record, no collateral, no assets, no nothing, and can get into this and buy businesses for no money down and all this wonderful stuff. And I don't blame the searchers. I mean, I even have a problem with the word searcher, to be honest with you, because you're not searching. I mean, it's a broker sort of laugh at that, but that's a derivative of a funded search. But it's a problem. I mean, they, you know, and...

There are people with hopes and dreams like all of us and just getting bad information. Bad information. Yeah, the days of an actual individual that wants to be a private family -owned small business owner acquiring a privately held family -owned established business, it's becoming less and more of a different mindset of

Deb Curtis (: 03:02

someone out there looking to buy a business with just 1 % down, which there are lenders out there. Maybe they will take that on case by case. I hear it all the time. Cause I will reach out to my lenders. I'm like, I'm hearing that banks are doing deals with 1 % down. And then the other 9 % is coming from non -family unknown investors that have nothing to do with the 1%.

owner operator that wants to buy this three to $5 million business. And, and, and there are lenders out there, front end lenders that are saying, Oh yeah, we can get that done. Well, let's reel it in. Cause we just went fishing and now let's put the package on the underwriter or chief of credits desk and let's see what he has to say. Yeah. I mean, the, the re you know, some of those deals get done. They don't get done with very often with.

you know, formalized SBA, because there are guidelines. And yes, every bank has their own rules and regulations and criteria. So you have this umbrella, you know, scope of not scope of work statement of work or whatever they call the, you know, the, the overall criteria with the SBA, but not every, and we've talked about it, you know, many times, not every bank has to comply with each of those individual criteria that make their own rules, if you will. There's still plenty of deals that are get that get done through

you know, with investors, with seller financing, with SBA and seller financing, with investor and some other commercial loans. So there is this buffet of potential ways to finance your business. But on the lower end, where there's this real misconception, even businesses that you cite and even smaller than that, the smaller the business, the more you rule out those possible lenders, you know, commercial banks or investors.

or those type of things, or institutional lenders, they get ruled out. And so this people are looking to complete transactions, oftentimes in a space where that third party capital is not going to participate. That's right. And thinking, and they go down the road trying to find a business and then find one, think they're going to find the financing after. And one of the most important things is, irrespective of what you're looking, what you're...

Richard Parker (: 05:25

what your finance, what your third party lender is going to be, who it is, irrespective of that, is you got to start it early. Like at the very least, you should know what you're up against. Cause if you think you're going to get an SBA loan and you can't, you got to pivot. And if you're going to get a commercial loan from a bank and you can't get one, well, you got to pivot. And so you keep your options available. I see more and more where searchers, if you will, they go down the road, they find it.

business and they, they, they, um, then they're scrambling to get financing. And then they realized like these avenues that they thought they're just not available. Right. That's right. Misinformation. Um, one lender that I spoke to yesterday did tell me he had funded one deal with 1 % down, but there was so many strengths.

to the proposed buyer as in sufficient equity in his home to take as additional collateral on a $4 million swing of intangible assets, which still blows my mind. Cause I know a lot of banks that I worked for in the past, they would say, hell no, we ain't touching that. That's just too much risk. But every bank has their own credit policies. Every bank has portfolios that live and die. And every bank has portfolios that certain industries,

struggle, others are successful. It's, it's, we're playing poker, Richard. Playing poker. And, and you know, it's just, you know, as you were talking, we were going through some of these scenarios. I was trying to think, you know, I was thinking about fake news, you know, like it's like fake news. It's, um, it's really unfortunate. I always, I, I wrestle with it. And from my own, you know, standpoint of looking at these people again, who have hopes and dreams and want to get this accomplished. I've been trying for, you know, yeah.

infinitely more aggressively in the last year or so because of all this information that's in social media and you know these shorts and these videos and YouTube's and they're very very misleading and trying to get people to reel them back in to say look you got to start breathing oxygen from from this planet and it's the same thing goes for sellers right I mean sellers are as guilty thinking that you know valuations that they read about

Deb Curtis (: 07:47

on Wall Street applied to their business on Main Street. And so, you know, we did a show on this as far as advisors are concerned. The best thing you could do to yourself for yourself is align yourself with people who are going to tell you what you need to hear, not what you want to hear. And there's not going to be any BS to them. Whether that results in you sometimes you reach a conclusion, a buyer saying, you know, I can't get this done.

I'm not in a position today to get this done. And so you have to set your goals for a couple of years down the road, but you need to take advice from, um, from the proper sources. That's right. And if you're dealing with a source, a direct lender, let's say, and they don't even have a full package, don't even know what the seller side of the transaction looks like. They don't even know the industry, the cashflow. They just have a buyer that's come into the table.

I want to do this with 1 % down and they've got 40 grand in their personal savings account and that's it. And they're a renter and they want to buy a three to $5 million business. And that direct SBA lender saying, Oh yeah, we can get that done with 1%. I'm not, I I'm going to be transparent and say, this is going to be a tough road. Well, tough is an understatement, right? I mean, you're being honest and say it's tough. You know, at the very least it's going to be really tough. And you know, one of the things that's,

like as a sidebar to all of that, is the individual that's looking to do this. It's nothing negative against them because obviously it's something they want to accomplish. They'd like to do it with 1 % down because these are the assets that they have, but they also need to be realistic. We talked about that. You know, what happens if the business goes south a little bit? Very often businesses decline the first three months.

after a sale, it's very normal that everybody's getting used to a new way of life, if you will. And so yes, you may get some working capital from your lender, but what if that working capital doesn't last long enough? And then you need to put some money in the business. I know most businesses that I've owned, it came a point outside of a few of them, I had to put some of my own capital in, especially at the beginning, nevermind just the acquisition at the beginning, you know, it's, you know, making payroll and it required plenty of times that I did that. And so...

Richard Parker (: 10:04

If you're faced with that situation, I mean, it's not dissimilar to buying too much of a house. And if you can't make the mortgage payments, the difference is, you know, the house will be standing. But if you, if the business needs money and you can put it in, the business is going to continue to decline. The house will still stand, but the business is going to continue to decline. And you can put yourself in a pretty rough position. So you have to do this in a really good way and real world way. And, and.

You not get delusional about all of it. That's a big problem. Delusional is right. It is a big problem. And when you want to buy a business that big and have the bank put up 90 % of the collateral with 9 % of the down payment coming from investors that don't really give a flying hoot if the loan goes good or bad because they're not guaranteeing and they're a renter. Come on now people.

That's what we're seeing today. This is what is happening in our new landscape. Yeah, and it should continue for a while. Deals are getting more creative. Deals are still getting done. I mean, I'm probably busier than I've ever been. So that's a good thing. So deals do get done. There's more creative financing. Bringing in other sources of financing are required. But getting leverage. Leverage is terrific unless it's not.

Right, you know, it's like everybody wants leverage, but the leverage has to make sense for the acquisition and you don't want to give yourself one at ease because you're gonna get in trouble in in a in a hurry Yeah, so you just it's very much comes down to deal in the real world understand what you're dealing with What is what is realistic looking at the business and don't get so caught up in? You know, I gotta buy this business that you

take your eyes off the ball of things that all these other pieces that have to fall into place properly. Cause if not, you're just going to, you're going to get, you know, you'd be getting a hold, holding the bag and it's just not going to end well. That's right. Have you ever seen so much marketing then these days regarding numerous influencers, numerous people coming into this space, selling everything to help people buy a business. Makes me want to puke to be honest with you.

Deb Curtis (: 12:28

I mean, I saw one recently and I had one, there was a, I think it was a post that I had, a short clip that it might've been on YouTube or LinkedIn or something. It was a short clip related to a specific part of business acquisition and talking about people if they needed any help to feel free to email me at any time. And we have this website, you know, our website that has all kinds of free articles and whatever. And someone sent me a message, please, if you can direct them to our website as well.

first of all, your business is not my business, number one. Number two is there's a whole ton of products that they were selling that complete nonsense. And so it's everywhere. It doesn't stop. I mean, this is one of the things where I got re -engaged with this whole process with trying to spread the good word, the accurate word of what people should be doing to get to the finish line and how they can buy a business in the proper way of doing things. It's just, again, it...

It makes me vomit, makes my blood boil. It's just, it's sickening and people, they're suckers falling for it while we're on this call. A few of them buy these programs. Yes, they do. Well, good luck to them. Exactly. Well, we're going to get to our subject right now, which won't take long Richard, because it is what it is. Did you know the SBA SOP, the recent changes in November,

Do not explicitly mention the requirement to take a subordinate lien on personal real estate to cover the shortfall of collateral of an SBA loan. Did you know that? It doesn't mention it, you're saying? It's not in black or white. So that it's up to the individual lender? Boom. But I'll tell you more. Say it again. Boom. Yes. Yes. But that is, that's the trick of the SOP. It's gray. It's just a guideline.

for banks and then the SBA says, you're the one giving the capital, you decide. But we, you know, the SBA was meant to back up banks that do these loans strictly based on cashflow. It's all about the cashflow baby. We talk about it all the time, right? Now, if there is a collateral shortfall, which buying a business there will be because of the intangible assets in the blue sky, then the SBA advises the bank should take

Deb Curtis (: 14:49

subordinate leans on any equity available of that real estate. And I do not know of any bank out there or non -bank lender that said, no, we're not worried about that. We're going to finance a blue sky loan. It doesn't happen. It doesn't happen. And the way I, the way I look at it and tell perspective buyers who are going down the road of an SBA loan is when you buy a business,

You do your best and you can mitigate and solve for most of the risk during the acquisition process. Things we teach and our materials teach how to do that, whether it be a customer concentration issue or a concern related to a lease expiring, whatever it may be, you can solve for or mitigate most and reduce most catastrophes to little incidents. There's always going to be a little bit of a risk, but understand that the life, the world of an entrepreneur is always going to involve some risk.

And I'm not suggesting that someone puts their house up. That's their own personal decision, but they need to understand the world of entrepreneurship. And if elements of risk in the deal never go crazy, but there's always going to be a piece of that. If the element of risk is something you cannot deal with or your spouse cannot deal with, A, I totally get it. B, if you can't deal with it,

then you know what, you are probably much better suited to be an employee than an employee -er because the risk doesn't end there. It's during the financing, when you run a business, there's elements of risk. You either have to learn how to deal with those, solve for them, but if you can't, and many people can't, and I get that. I'm not judging anybody. It's just maybe that world is not for you. I mean, to me, it's just that simple. I'm going to add to that, Richard.

If you are going to purchase finance of business and you have equity in your home and you know that there's going to be a subordinate lien placed on it, you better have someone asking you, when do you plan to sell that home? And if the answer is you plan to sell your home in the next two to three years, maybe even in the next four to five, you better think again about doing an SBA loan.

Richard Parker (: 17:11

And if a lender is saying to you upfront, because they just want to get the loan on the books to earn their incentive, watch out. Cause those kinds of transactional lenders are out there. If they're telling you, Oh, no problem. Just call the servicing department when you're ready to sell the home and they'll work it out for you and release that lien. Yeah. Yeah. Of course. They'll work it out for you and release the lien as soon as you pay them. Yes, of course. I mean, it's becomes, it's a do on sale clause. There's no escaping it. Now you can recapitalize it and get.

get another loan somewhere else, pay off the first loan, but they're not just forgetting about it. I saw, Sia made a comment by the way. It says, wow, never thought of it this way, Richard Parker. I would be so dumped if I put our house up, but I agree. And that's exactly the case. Some, you know, in some scenarios, both parties agree. They have to agree, but if they don't, it's you've got to, you've got to be understandable. That's right. And I would just want to add, Sia is in the state of Texas. They're the only state.

in the United States where we that I shouldn't say we the SBA or the bank lender cannot take a subordinate lien on any homes in the state of Texas because that's the Texas law. So see you're fine. You don't have to worry about your home. Take out an SBA loan. Oh yeah. Right to the, to the max. That's right. To the max. To the max.

I know there were Florida, something related to homestead, but we don't have to get that granular. Yeah. You're right though. Florida's got some funky rules down there too. Yeah. Which they protect the homeowner and mostly from judgments or what have you, I believe. But can I give two examples for our listeners? Same price. Yeah. I'll make it quick because we got some questions. Take as much time as you want. I'm not, I have nothing to do this whole afternoon. All right. I'm going to give two examples and then we're going to get to who's the Dupa and close out with Q and A. So example number one.

If you're listening, I had a buyer, uh, she purchased finance, a retail pet store, profitable, great business. The deal was, I believe like 1 .5 million. She had equity in her primary residence and she had four townhouses, duplexes, all with mortgages, but each one had some equity in it. And they.

Deb Curtis (: 19:28

All four of those investment property duplexes were in her personal name. She didn't put it in LLC. We had to take a lien on her primary residence and the four townhouses because they were all in her personal, all in her personal name. So that was five subordinate liens and the loan was still not a hundred percent collateralized, which is okay because the SBA says where it's all about cashflow, but the banks want to secure the additional collateral.

If the guarantor has it. So that's example number one. Now, if she came to me, maybe on her primary residence and said, Deb, I'm okay, you know, taking subordinate liens on my town homes, but I'm going to do a home equity loan on my primary residence to use some of that equity as cash toward the purchase finance of this business. As long as I know that, and I write it up in the credit memo.

table back before November of: 2023

The banks have the final say and not every bank is okay with the SBA SOP. Right, absolutely. And those are perfect examples. One thing I want to touch upon, I know we have the, if I'm the DUPPA and Q &A, but it used to be a number of years ago where the banks were pretty SBA guidelines were required to go after.

residential collateral if there was more than 25 % equity in the home. I'm not sure if that's changed, but it's still based on what you said, not being written black and white, it's up to the individual bank. It doesn't mean the case that it's always going to be that particular situation, but by and large, mostly, and you sit from a bank's perspective, if there's equity that they could further guarantee,

Deb Curtis (: 21:39

or secure their loan, even though the SBA is underwriting or guaranteeing a certain part of it. Well, why wouldn't they go after it? It doesn't mean it's always the case, but you have to think about that. It's more than likely going to be the case. Right on. Now what happens when you, if they, if you have a home equity line of credit, you don't use it for your, um, cause there was a point where because of this 25 % piece, people used to go take a home equity line.

of credit, which I always used to advise them to do, because it just get you over that 25 % threshold and then the banks don't go after you. There's no such threshold anymore, right? I mean, they would go after you if there's 10 or 20, like they don't calculate loan to value or is there a certain limit that you've seen where there's, if there's less than X amount of equity in the home, they won't go after it or they won't require it? Still less than 25 % Richard, but up to the underwriters determination of what that home's value is worth.

Right. So, but there should be a case in those cases, it's still a good practice beforehand to have a home equity line of credit, even if you don't use it, because if it takes you below that threshold, you may be able to, you know, use that as a workaround. It's not, I mean, it's beyond legal. It's perfect. If you get that into place, but people should also understand that not every underwriter is going to agree. They may just pass on the loan. Exactly. That's exactly. Thank you.

You're welcome. I tell that to people that call me trying to find a way to not put the lean on the home. I'm like, listen, if you're going to shoot north of a 2 million unsecured business acquisition loan, you better have some equity if you're in, in that Northland, because that's going to make the underwriter feel comfortable. Yeah. But you know, they still choose to, um, want to work the system and to each his own.

Of course. We said earlier, we're playing poker. We're playing poker. Yep. Each his own. Well, I think it's time for who's the dupe. What do you say? Let her rip, baby. Let it rip.

Syya Yasotornrat (: 23:49

All right, ladies and gentlemen. Was that you? Yes, it was. Oh, man. Excuse me. Thank you. All right. No problem. Listen up. My buddy, Jay, his family has a lot of money because his dad owns a big construction business and he keeps telling me he's my buddy, that it's better to be the boss than to work for someone. And he always asks me why I don't.

operate or start up my own business because he's been working for his dad in a construction company for over nine years. Okay. Did you follow me there? So buddy, buddy's best friend, Jay works for dad's company for nine years as a general manager. So his buddy tries to give entrepreneurship, entrepreneurship advice to him, but doesn't really understand how hard it is to run a business from scratch. He's just, you know, the son.

That's learned the business from dad, but dad's the one that started from scratch. So his buddy said to Jay, that business really isn't yours. So why do you keep calling it your business? You're working there. You're a W -2 employee. You don't own it. And you need your dad's approval for big business decisions. He's telling Jay, you're more like an employee in the family's company than claiming to be an owner.

You're not an owner of the business. Ever since I told my buddy Jay that we haven't spoken for two years, did I go too far? He lost a friendship, Richard, because he hurt Jay's feelings, the son who's not an owner of the business. Yeah. So my, like my answer, he's not a dupe, he's an a -hole. I mean, I, I don't know.

There's some speculation here or can But buddy sounds like he probably doesn't own his own business. He's just stirring the pot You get this all the time all the naysayers. Okay, they're just taking shots at someone else buddy sound buddy sounds like someone who has zero Entrepreneurial spirit running blood running through his veins and he's just taking shots So from the beginning I understand if you have that if if Jay went to him and say here's my dilemma I'm working for my dad been here nine years. I really don't feel like I have ownership

Syya Yasotornrat (: 26:10

and ask him to weigh in on it. That's a different story than Buddy just speculating and jumping right in and dispensing advice because the reality is Jay might be totally cool with this. Jay and his dad may have already worked it out that over the course of time he's going to inherit it. He may have a certain equity that he's going to get. He may get a piece of it when they sell. So Buddy is as far as I'm concerned, based on these facts, I may be missing it. He's a complete a -hole. I agree. I agree. And you know what?

Would you say a lot of friends out there perhaps have something to say about the small business owners? All the time. All the time. When you get business buyers, I tell every one of them and even in the course, you know, understand that the people around you, people, friends, family, whatever, some of them don't want you to get hurt. So they're going to tell you not to do it. They don't want you to see to absorb the risk, but all the people that don't really like care deeply about you, their opinion is going to more than likely be negative.

Cause they don't have their co -owners to do what you're planning to do. And so I see that repeatedly where it's just the naysayers and the people that never get anything done and they're just knocking everybody else. Cause they just can't get, they just won't do it themselves. And so, you know, you just have to put on your blinders. You take the advice from the right people, but yeah, that it happens. I see it all the time. You know what? I would love to finance that business for Jay once daddy, uh,

Um, passes it on to him cause he is the perfect key employee, baby. He certainly is. And you know what? He would have no problem getting financing. And he's very happy. I'm sure he's very happy. Unless he won for the 1 % down, Richard, that's the deal right there. Yeah. So the Dupa, we agree on the Dupa. Perfect. We agree on the Dupa. Awesome. All right. We got some Q and a, and they're going to be put up on the screen here, right in the window, Richard.

And, and yeah, yeah. If you're listening, if you're a business broker, a buyer or seller, just put in the comments for us. We'd like to know who, who we're talking to, or if you're just a loyal listener, um, uh, see is going to put up some questions here. All right, Richard, take it away. Here's one from Patrick. If the bank loses or losses lending conditions to approve those loans, Ninja type loans, we are all in trouble. Okay. That's got it. Question. Yeah.

Syya Yasotornrat (: 28:31

How does the SBA evaluate the value of the home equity being pledged? I'm sure it's through general appraisal, but Deb, if there's anything different than that, jump right in. Yeah. Again, bank by bank, their decisions of how they value homes, um, depending upon the amount of equity, it may be a full boat appraisal depending upon the size of the deal. If it's not much equity, it might just be a standard desktop.

Um, I think back to the year: 2020

It's going to be worth probably 50 grand more in the next six months. Right. Yeah. So, uh, again, great question, Jody, thank you. All depends upon the underwriter and the bank that you're working with. There's no rhyme or reason, but if it's a lot of equity, third party appraisal, if it's minimal and a smaller size deal, perhaps a desktop and the underwriters determination. Got it.

Oh, here's one from Patrick, which I just had this conversation with someone yesterday about because it's a great point. He talks about concerns around falling housing prices. So if I could jump in for a second, and Deb, then certainly want to get your perspective. There's two prongs to this related to housing prices and the buying and selling businesses.

because they're really related. So the first part is related to what we're talking about today and an underwriter looking at it and how they're going to value a house and appraise a house. And they use, you know, transactions, mostly comps, it might be a broker's opinion of value. But whatever methodology they use, it varies from location to location because in Florida, house prices are going bananas and in other places they're declining. So that's, it's really unique to each area. And

Syya Yasotornrat (: 30:44

the extent to which they want to have an appraisal, whether again, it's just a unzillo or a full appraisal. But the other part to all of this is housing prices, when they start to decline or people are feeling the pinch, it impacts people's confidence. And what happens is you see generally speaking, the market constrict of individuals.

who are looking to acquire businesses because their confidence starts to decline. And as their confidence declines, they're less willing to take potential risks or to buy businesses. They start to think, well, if house prices are declining, I don't have the same equity. If the interest rates are going up, if I have to refinance or the economy is shrinking, I may have to lose my job. So you get all of that. So that impacts the market. But at the same time, when house prices are rising,

people become euphoric and they feel infinitely more confident about the market and entrepreneurship starts to really ramp up and people's desire to go into business. So, I mean, there's really the two parts is related to the underwriting, but there's also the overall confidence or lack thereof in the market that really gets impacted as home prices rise or fall in each area. That's amazing. Mindset maybe. Yeah, I would say so.

I'd like to add to the falling house prices. If you have an SBA loan in the market's fall has fallen and your home is being used for collateral, it's not going to impact. You still owe the money. The lien's going to still stay on that home no matter what. Right. And then another follow -up I would like to add, this was a question posed to me over the last week, a renter.

Yes, renters can buy businesses and renters can get bank loans back by the SBA. But his question was, is this going to impact me when I shop and buy a home a year after I buy the business? Well, the SBA and the bank aren't going to come at you a year later and say, Hey, Richard, you bought a home, so we're going to tackle lean on it. No, that's not going to happen. That can't happen. But what will happen, we must remember when you buy a business,

Syya Yasotornrat (: 33:02

You now have an owner officer's salary as reported on your business tax returns and the mortgage lender, the underwriter is going to want to see your financials of the business to make sure it's financially sound, that you've got a salary and enough personal income to take care of your personal expenses covering the whole global picture. Right. Got it. It does change. It does change. Yeah.

And by the way, just to tag along to one of the points you said that if the house prices, the value of the home declines and you decide to sell it, it's like, you know, tough for you. But on the other hand, the bank is not coming back to you to add more collateral to the loan if they're in second position. So if they're second position, if the value of the home or the equity becomes less than their second position, they're not coming back to renegotiate. They're in.

So there's both sides of that equation. Yeah, may go down, but you don't have to worry. They're not coming back and asking for more equity or more collateral. So it just happens. And hopefully, you stay in it long enough. House prices will over time increase, except for some markets where it could have something catastrophic happen. But generally speaking, you should be okay. But these are all really important considerations for people to make before they jump in and collateralize alone.

And I hear you mentioned, you know, second position. Yes, we will do business acquisition financing with a third position. So, uh, yeah. I mean, there's equity. I have seen these deals get done. We're a third lien, meaning is subordinate to your first mortgage holder, your second mortgage holder, and the SBA is taking a third lien on whatever remaining equity is available. Okay. Okay. That's good to know. Yeah.

Here we got one. What steps shall small business owners take to mitigate the risks involved in pledging their home equity for financing? To mitigate the risks. I'll tell you what, buy a good business. Thank you. Don't buy a shit business. Don't buy a business that you were meant to run. Your skills match it. It's a good business. You're confident. And again, the match is critical, but it's a good business. It's got historical financials.

Syya Yasotornrat (: 35:25

It's not subjected to these roller coaster revenues and profits. It's stability. We've talked about the fact personally, growth is very sexy, but stability adds a lot of value. And so the best way to mitigate it is by a good business that you are perfectly suited to operate. That's the best way. Like Jay and buying his father's construction business. He knows what's going on every day. I'll tell you one thing though, if Buddy buys that business,

The business going out of business pretty quickly. You know it. It's true. It's course I bet I'll bet on that right now. I don't even know anyone. If you're standing next to me, he's a naysayer. All right. Well, I think we wrapped up our questions. Maybe you can put up for, um, um, our loyal listeners, see, uh, the, uh, sellers, uh, QR code and Richard can speak to that.

brain's a little slow there. It's actually your brain is where you, you, Deb's been up most of the night. My husband's passing the kidney. He's passing a kidney stone, not his kidney. He's passing a kidney stone. If he passes a kidney, you're becoming a donor. Okay. There you go. I was on the national kidney donor registry at one time in my life. So I would give him my kidney if I had to. One of my oldest friends, she donated her kidney to who, which is now her late father lived for many years thereafter.

And her father bought her father afterwards, bought her a kidney, a diamond kidney shape necklace. Oh, I love that. Nice. Yeah. Yeah. So here's the 10 things sellers won't tell you. We've talked about this before. Terrific report. If you're thinking about buying a business and if you're thinking about selling a business, something you should be aware of as well is these are.

You know, these are not legal issues that a seller is absolutely obligated to disclose as material items in the cell, but there's certain things that they won't tell you unless you ask them, or there's certain things that they may say to you that aren't 100 % accurate and not necessarily live, such as what's happening to the customers after a sale, any concerns, key employees.

Syya Yasotornrat (: 37:35

if there's any issues related to leases or the competition or anything that they've heard about. So all these things that you as a buyer need to investigate where the seller may not disclose it, probably won't disclose it. And even if you do ask them, they may not give you a perfectly clear picture. So I called them the 10 things sellers won't tell you and Deb contributed one specific section related to the financing because very often they'll talk about how they will or will not provide any financing. And so you should be aware of that and this covers deal terms.

competition, clients, employees, the marketplace, terrific reads, about 40 pages, but it's really a terrific read and you'll find it very, very helpful. How's that for a self -serving sales pitch? You're hired, man. Put that in a commercial on TV. Thank you. We need to speak more about small business acquisition deals on the evening news. I mean, come on, we got to save small businesses, America.

We certainly do. And people need to patronize them. You really need to go out of your way. You really need to go out of your way. It's very easy to, no disrespect, very easy to go to Home Depot, but it's, you know, if it's at the local hardware store, go there. If we don't support small, we're going to be owned completely by the big. And I was - Yeah, because the retail is changing so dramatically. I mean, in a generation now, who knows if we'll even have shopping centers. I mean, it's really frightening.

but you got to go out of your way to support small business. As long as what they're providing is similar and reasonable, of course, but you really got to go out of your way. It's so, so important. It's the engine that drives the whole US economy. That's right. It is. And speaking of small businesses, can we give a shout out to our producer of our show, Brilliant Beam Media? Yeah, we really want to be a go ahead. I love that.

So for those of you that are a small business owner or maybe even a solopreneur, listen, if you need help with anything, website related, marketing related shorts, YouTubes, you name it, brilliant beam media. They're small, but they have a big heart. Uh, I'm going to tell you, yes. Um, just lean on them. She had her QR code up. That's our sponsor and our, and our, um, backstage gal. We love her to pieces. See ya. So I think we.

Syya Yasotornrat (: 40:00

We wrapped everything up, Richard. Perfect. Work fast and go home early. I'm done. My favorite word for you is perfect. Perfect. Yeah. All right. Well, listen, ladies and gentlemen, we come back next week, Thursday, 2 PM Eastern with more business buying banter. Until next time, see ya. Ciao for now. Bye. Bye.