Financing Scenario

HVAC Business Case Study

HVAC Business Case Study

Buyer acquired an existing HVAC Business. The company was founded by the owner in 2002. The company specialized in residential and commercial HVAC services. This transaction was an asset sale

Purchase Price $ 800,000

Loan Structure
  • Purchase Price    $800,000
  • SBA Fees/Costs    $44,000
  • Working Capital    $50,000
  • Total Project Cost    $894,000
  • Seller Note    $0

  • Buyer Equity    $89,400 (SBA requires minimum buyer equity of 10% of the Total Project Price)

  • SBA 7a Loan    $804,600

Business Purchase Scenario
Loan Terms
  • Term    10 Years

  • Amortization    10 Years

  • Estimate Payment    $9,000 (approximate – based on Wall Street Journal Prime Rate + 2.75% (SBA Maximum)

Personal Credit
  • Average Credit Score    792

Additional Collateral Pledged
  • Buyer pledged primary residence and two investment properties. All three properties had more than 25% equity and therefore were required by SBA to be pledged as collateral for the loan.

Total Cost

Remember your total out of pocket costs will be higher than those costs estimated within the SBA loan as they vary by transaction. Additional costs to consider:

  • Life Insurance Policy

  • Business Insurance Policy

  • Title/Transfer tax on vehicles included in the sale
  • Attorney costs

  • Relocation costs


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There is no substitute for extensive SBA 7a financing acquisition experience. Every transaction is different. Every transaction is completely custom. These transactions require an expert to get you the best terms possible, guide you through the process from start to finish, and make sure there are no surprises on the closing statement. Choose your SBA professional carefully!

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