There are three types of funding: conventional loans, SBA loans, and seller financing.  Conventional loans are the most common type of small businesses lending. They provide short-term, intermediate and long-term funding for companies. Rates and other terms differ between lenders and depend on the overall credit risk of the Buyer or business applying for the loan.  The Small Business Administration (“SBA”) offers a variety of loan programs to help small business owners obtain necessary financing to grow or purchase a business. The SBA doesn't lend money directly but instead provides conventional lenders with federal guarantees for loans that meet their guidelines. When you apply for an SBA loan, you will typically be borrowing from a bank or specialty financier.  Seller financing is when a Seller lends their Buyer a portion of the business purchase price. The Buyer and Seller will execute a promissory note outlining terms such as interest rate, repayment schedule and consequences of default.