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How the sale of your business is financed may be driven by your personal financial needs and lifestyle. Start by deciding whether you would like to remain involved with the business or walk away from it entirely. This helps determine whether you will want to participate in the financing or have the buyer obtain independent financing. The following options illustrate the levels of financial involvement you might have in the sale of your business.

Cash. Once a selling price is agreed upon, the buyer simply pays you that amount. You have no involvement in the financing.
Seller financing. The buyer pays a portion of the agreed upon selling price at the time of sale and you provide financing for the balance. The seller-financed portion may be driven by the amount of goodwill factored into the total business valuation because goodwill is so hard to value.
Lease option. Your buyer leases the business with an option to purchase. This gives a buyer without sufficient cash or financing resources an opportunity to participate in the business and earn the necessary cash portion of the sale price. While the business is being leased, you are still the owner.
Other Inducements. To sweeten the deal for a potential buyer, you may want to offer to serve as a consultant or sign a non-compete agreement. Consulting allows you to stay involved in the business and gives the buyer the benefit of your expertise and customer loyalty. It also gives the buyer confidence that you do not intend to compete under a new business name. A non-compete agreement can be an added inducement to a sale, although you should check with your attorney to find out your state's requirements. This agreement formally assures the buyer that, for a set period of time, you don't intend to start up allover again under a new name and lure away customers loyal to your former company.

Speak with a lawyer before finalizing the sale of your business. To make sure you have complied with relevant state and federal requirements, have your attorney review the sales documents, or draw them up. You don't want any unpleasant surprises after the sale.