Kevin Bell

A Lenders Preference For Businesses To Buy

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📞 Had a call with a lender the other day.

Here’s their take on HVAC, Plumbing and Landscaping businesses.

Preferences: HVAC and Plumbing over landscaping.

They have teams focused on nothing but each of those business types.

Issues with landscaping (in their minds) ✔️ Smaller landscaping businesses are pretty difficult to loan for. Basically just a client list.

✔️ Ideal: 50+ employees with contracts and systems

✔️ Not ideal: less than 50 employees, all residential/ seasonal.

HVAC/ Plumbing/ Home services Things to think about:

✔️ Focused on more home repair as opposed to new res. construction

✔️ Construction for new residential are tied to housing market

✔️ Check whether an owner needs to be licensed. Some states require that

Things they look at for UW:

➡️ 1.25 DSCR - HVAC

➡️ Outside of HVAC - 1.5 DSCR