Case Study: $1.85 Million to Buy an Insurance Agency Book of Business

The BankLink team matched this insurance agent with a lender to finance the purchase of a second book of business for her insurance agency using SBA 7(a) Loans.

Despite a series of challenges, including the sale of her home during the financing process, the BankLink team helped this insurance agent navigate the SBA process and finance her $1.85 Million book of business acquisition within 3 weeks.

The Opportunity: Buying a Second Book of Business

Our BankLink client was an insurance agent and consultant looking to build out her book of business.

She identified a potential acquisition target: an insurance franchise owner who sought to reduce its capacity by selling its book of business.

Our client had a plan to buy a franchised agent’s additional book of business.

She saw opportunities for improving its operations to become more profitable while continuing to grow the business with better marketing.

The Challenge: Limited Timeline, Complex Circumstances

Our insurance agency client needed financing to acquire the new book of business, a $1.85 Million transaction.

The financing needed to be affordable and efficient, with terms that enabled healthy cash flow management. The buyer and seller were also challenged by an expedited closing timeline that worked within both agents’ personal windows of opportunity.

The seller requested a hard closing date within two weeks, a time frame that would typically rule out SBA business acquisition loans for a transaction of this size.

Additionally, the guarantor was in the process of selling her home, meaning that the collateral pool was subject to change at a moment’s notice. In fact, the home sold just days before closing, necessitating a last-minute change in the deal structure which could jeopardize SBA loan denial at the last second.

The Solution: SBA Process Powered by Experts

Windsor BankLink’s expert team of SBA Underwriters worked alongside the bank lender to efficiently navigate this complex loan transaction, leveraging in-depth SBA financing knowledge, consistent communication with all parties, and relationships with legal counsel and the lender’s internal team.

The underwriting teams and closing teams at the Lender and Windsor BankLink combined efforts, along with legal counsel, to ensure closing documents were revised and completed in time to push this loan application to “closed and funded”.

This was no small feat in the document-heavy process that is the SBA loan application, especially with the timeline restrictions that could jeopardize the deal if the loan underwriting team was not able to deftly navigate the unique deal structuring challenges. 

All applicable requirements were met per SBA standards prior to the deadline being missed and the seller walking away from the deal, enabling the insurance agency buyer to capitalize on a rare window of opportunity.

The Result: Successful Acquisition with Long Term Financing

This $1.85 million business acquisition SBA loan was closed in about 3 weeks after assignment despite complex needs regarding seller transcripts, structural confusion, and the guarantor’s personal real estate collateral removed just prior to closing.

The insurance agent was able to purchase the book of business from the franchise seller, and built out is operations utilizing an affordable financing solution through the SBA. Her financing terms ensured healthy long term cash management after the acquisition of a new book of business used to catalyze growth.

Get in Touch: Meet with Business Acquisition Financing Experts

Our team works with business owners nationwide to structure financing with the terms and lender that works for their goals. Use the form below to learn more about our process, pre-qualify your acquisition for SBA financing, and begin the lender matching process through BankLink. 

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