Need Advise On Buying Business Not Building
I found a gym that has an owner who purchased on owner contract. She (party #1) is now defaulting on the morgage and is not managing the business well. She wants out.
The person (party #2) who sold it to her is out of state and wants to take it back and resell it to me. She is willing to carry a contract.
The owner is not willing to assign the current contract to me (although it is assignable). She wants money. She has only owned the place since last Nov and has no equity. She is broke and desperate. Party #2 may end up foreclosing.
I need to figure out how to aquire the gym with little money out of pocket all the while keeping everyone happy. These two parties are very upset with eachother and not talking. They both are talking to me (for now).
Can party #1 quit claim her interest in the gym to me or would they need to quit claim back to the original owner
(party #2)?
Any input is appreciated. Thanks in advance.
1st, The devil is in the details! Do your research on the service biz. Contact the trade assn. for this type of biz, go to the library and ask the reference person for
assistance in this. Then contact the Assn's, ask for their input/assistance.
Ask for guideline's for profitablity & other critical info. Assess if it's a pos./neg. $$
maker w/the www.info.obtained- only then can you make a accurate decision!
Mark
i am leary of buying a failing business. dig deep into the reason it is failing. we all think we can "fix" whatever is wrong............km
and that is not always the case.......km
Thanks for your input.
The reason that this business is failing is because they are not managing it well. It was a thriving business with books to prove it 2 years ago. The currents owner has 6 kids (2 handicapped) and there is alcohol involved + it is run by volunteers and not a single paid employee. Volunteers are not concerned with management and do not always show up on time to open the doors for the day or for their shift. No records have been kept for the past two years. The owner says it is more than she can handle and does not even go there anymore.
People come to workout. They know the business is shaky and do not want to lose the club. This is a much needed gym in the area. There is one other gym at twice the cost. I may have a couple of people who want to help in investing.
I have no experience in buying a business---only property.
I have a similar situation going on now with a piece of property.
Simply purchase the property from the deed holders subject to the exiting mortgage AND existing contract for deed to the contract holders.
Have the contract holders sign an "assignment of contract" and also a quit claim deed over to you.
Now you are the deed holder and contract holder and you can simply cancel the contract with yourself.
GOOD LUCK