By Ian Seekins, Director of Funeral Home Lending

Owning a funeral home is more than just a business decision. It’s a calling that can help you ensure families in your community will always receive the care and comfort they deserve in their time of need.

But purchasing a funeral home doesn’t happen overnight. It’s a journey that can feel like climbing a mountain.

And to reach the peak, you need the right preparation, strategy, and support.

Here are 5 key steps to make your first funeral home purchase successful.

1. Choose the Right Lender

If you’ve never climbed Mount Everest before, going without a guide may not be the best decision. The same goes for purchasing a funeral home for the first time.

To avoid problems and delays, you need a lending partner to help you understand your financial position and create a plan. Your lender should also understand the unique financial landscape of the funeral profession.

A lender who is knowledgeable about the funeral profession can guide you through your financing options, explain loan structures, and help you budget for future expenses like payroll and renovations. They can also offer insights and advice specific to funeral homes, which you may not get from other lenders.

The right lender can also help you with the preapproval process, giving you a better idea of your budget and making the purchasing process smoother.

With a trusted lender, you’ll have the financial support you need to move forward with confidence.

2. Negotiate the Price

Now that you know your financial situation, you’re ready to negotiate the price of the funeral home you wish to purchase. This is a key part of your trek up the mountain, though it can feel like a dangerous part of the trail.

To help secure long-term success for your future business, you must know how to evaluate the funeral home you’re interested in buying. Cash flow and call volume aren’t the only indicators of a funeral home’s value, and overpaying for the business can leave you in a difficult spot financially.

But using the right lending partner can protect you from a bad deal while helping you present a respectful offer to the funeral home’s owner.

One way to make negotiating easier is to remember that the asking price is often just a starting point. There’s usually some wiggle room, and the seller will likely expect a counteroffer from you.

Ultimately, the more you know about correctly valuing a funeral home, the better you’ll be able to secure a fair price and make a smart financial decision for your future.

3. Secure Your Loan

After agreeing on a price, it’s time to secure the funding needed to complete your purchase. Think of your funding as your hiking equipment. Even if you have a strong desire to climb to the top of the mountain, you won’t get very far without the right boots and gear.

And partnering with the right lender is a crucial piece of equipment that you can’t afford to forget.

Before you secure your loan, you need to work with your lender. The right lender can make this process easier by providing you with a checklist of all the necessary documents, including financial statements, business plans, and other relevant information, to support your loan application.

Also, since funeral home loans can be unique, it’s important to be aware of any special conditions that may apply, which is something your lender can help explain.

Once your application is submitted, your lending partner should keep you updated on its progress and answer any questions you have.

Securing funding is essential for moving forward with your purchase and ensuring you have the financial resources to operate your funeral home successfully from day one.

4. Work With an Attorney

Sometimes, you don’t know what you don’t know. But one thing is for certain – you don’t want to be halfway up the mountain and discover that you need an accessory chord and hanging belay instead of a munter hitch and slingshot rand (yes, those are all rock climbing terms).

It’s the same when purchasing your first funeral home, which involves several legal complexities, and you might need help understanding them.

A business attorney can help you navigate contracts, ensure all necessary licenses and permits are in order, and protect your interests. They can also work with the seller or the seller’s attorney on your behalf to facilitate the purchase and encourage a smoother negotiation.

Here are a few other ways the right attorney can help you secure your funeral home purchase so you can avoid delays or even a cancellation of the sale:

Just like the right lender can help you with the financial side of the purchase and ongoing support, the right attorney can ensure you’re set up for success on all the legal requirements.

5. Complete the Purchase

Can you feel the elevation changing? You’re almost at the top of the mountain!

Finalizing the purchase is the last step before you can start serving families. Ensuring all financial and legal details are in place will make your transition into ownership as smooth as possible.

After securing financing and resolving legal matters, remember to sign the final agreements, transfer assets, and officially take ownership.

You’re now ready to run a meaningful business that will serve your community for years to come. Congratulations!

Reach the Peak with the Right Partner

Deciding to purchase a funeral home is just the beginning. As you ascend to the peak of ownership, there are several steps to consider.

The trail can be long and challenging, but working with an experienced guide who understands the funeral profession and is committed to your success will help you navigate the process with confidence.

At Funeral Directors Life, we specialize in helping funeral professionals achieve their dream of ownership. And we can do the same for you.

Let us be your trusted partner on this journey, ensuring that every step brings you closer to funeral home ownership.

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