You want to sell. But can a buyer pay what your book’s worth?

The downturn’s made it harder for business owners to access credit, as evinced by a 2011 report by Canadian Financial Executives Research Foundation.

And securing credit isn’t necessarily any easier just because you’re in the financial sector.

If a bank lacks financing programs geared specifically to advisory practices, you’ll be put into the same queue as any other company seeking succession financing, notes chartered business valuator Sondra Stewart.

“Banks are going to expect the buyer to come in with some cash,” she says. “They’re only willing to lend a percentage of what they think the business is worth.”

What’s more, loans are based on expected future cash flow—and not on standard industry multiples.

Exiting advisors frequently accept down payments from their chosen successors, followed by installments, or a modified work-to-own arrangement that puts stock into the buyer’s hands.

But Stewart warns “as long as you’re waiting for a dollar back from the sale, you still have risk.” Until all the money changes hands, your buyer could fail to make payments—or even default.

So, even if you’re ready to exit, you may have to hold on until someone can scrape together enough to buy you out. And if you can’t, then you may be obliged to accept a lower price. How do you avoid this? Prepare early to make sure your book is attractive. You may plan to work another 10-to-15 years, but it’s never too soon to inventory what’s valuable about your practice.

Once you’ve done that, quantify how those things contribute to your annual cash flow and profitability. That makes your book more appealing to a buyer, and consequently to a financier.

When sale time comes, avail yourself of government programs, regardless of the credit landscape. The Business Development Bank of Canada, for instance, exists to promote entrepreneurship. Let it help you, or your buyer, secure financing.

While the BDC’s loans cost more, it’s often willing to partner with you or your buyer’s bank to finance any shortfalls. It may also offer longer repayment terms and exclude a buyer’s personal property from the collateral requirements.

Your clients deserve the best successor possible. Make sure you attract that person with a streamlined, documented business model. If you don’t, you’ll be in a rush to sell, and you’ll have to compromise on one or more factors.

In today’s credit environment, the first is likely to be price.