Overview
Seller financing can help buyers purchase a car wash by reducing the cash required at closing or bridging a value gap. The seller provides a note that the buyer repays over time, often alongside a senior lender loan.
Common seller financing structures
- Second lien note behind the primary lender
- Standby seller note with payments delayed for a period
- Partial purchase price carry where the seller holds a portion of the price
How lenders view seller financing
Lenders often accept seller financing when it strengthens the deal and does not increase payment stress. The senior lender will review the seller note terms to ensure the combined debt service remains manageable.
Terms that can create approval problems
Large payments that start immediately, high interest rates on the seller note, or short amortization schedules can reduce cash flow coverage and limit the senior loan amount.
What improves lender comfort
- Clear documentation of the seller note terms and security
- Reasonable payments that do not strain debt service coverage
- Standby or interest-only periods when appropriate
- Clean performance support so the deal is not dependent on optimistic projections
Bottom line
Seller financing can be a strong tool for buying a car wash when it is structured to support cash flow and fits within the senior lender’s underwriting rules.