Can I sell my auto shop if I still owe money on it?
Plenty of shops sell with loans or equipment notes still on them. Usually the debt gets paid off at closing from the sale money. What matters is knowing exactly what you owe before you start.
If this sounds like youYou owe more than you'd like, and you're a little ashamed of it. You're worried no one will want a shop with debt on it.
What you can do.
Pay off debt from the sale
The most common way. Lenders get paid at closing.
Have the buyer take over a loan
Sometimes possible, if the lender agrees.
Pay down debt first, then sell
Can help, but may take time you don't have.
Sell the building to clear the debt
If the property is worth more than what you owe.
What to watch for.
- List every loan, lease and back bill in one place.
- Ask your own CPA how the debt affects what you'll take home.
- Be honest with buyers early. Surprises late kill deals.
Owner to owner, and it stays private.
Lotus buys running shops and their buildings in Massachusetts and Connecticut. Debt doesn't scare us off. We'd rather know the full picture up front. Talk with James, privately and without judgment.
James StephensonLotus, Massachusetts and Connecticut
Quick answers.
Will a buyer walk away if I have debt?
Not usually, as long as you're upfront. Most sales pay off debt at closing.
What if I owe more than the shop is worth?
Talk with your own CPA and lawyer first. The building, if you own it, may change the picture.
Thinking about what comes next for your shop or building?
Reach out and we’ll talk it through. No pressure, and the conversation stays private.
james@lotuspe.us