Published on 15/10/2025 by Any Business.Com.Au

Getting a Business Loan: To Broker or Not to Broker?

So, you've found a business you'd love to buy. Maybe it's a café with loyal locals, a thriving e-commerce store, or a service business you know you could take to the next level. Whatever the opportunity, chances are you'll need finance to make it happen.

Buying an existing business can be one of the fastest ways to become your own boss, but securing the right business loan takes preparation, documentation, and strategy. The good news? With a bit of planning, you can make the process smooth and position yourself as a strong borrower from the start.

Know What You're Buying (and What It's Worth)

Before you even think about applying for finance, you'll need to do your homework on the business itself. Lenders want to see that you're buying a sound, profitable operation and you should too.

Start by reviewing:

• Financial statements: Ask for at least the last two to three years of profit and loss statements, balance sheets, and tax returns.
• Cash flow and trends: Is the revenue stable, growing, or declining?
• Customer base: Are there key clients or contracts that the business depends on?
• Assets and liabilities: What equipment, stock, or property comes with the sale and what debts or leases are you inheriting?
• Valuation: Consider getting a professional business valuation so you don't overpay.

This due diligence isn't just for your peace of mind. Lenders use it to assess how much risk they're taking on when financing the purchase.

Understand Your Loan Options

When it comes to buying a business, there are a few types of finance you might consider. Each has different structures, security requirements, and repayment terms. While it can certainly go it alone, it may be worth engaging a business broker who understands this type of finance and process well and can guide you through step-by-step.

Common business purchase loan types:

• Business acquisition loans: Specifically designed for buying an existing business, often secured by the business assets or your personal property.
• Secured business loans: Use real estate or other assets as security to get a lower interest rate.
• Unsecured business loans: Faster to access but usually come with higher interest rates and shorter repayment terms.
• SBA or government-backed loans (if applicable): In some regions, government programs help fund small business purchases through partially guaranteed loans.
• Vendor finance: Sometimes the seller agrees to fund part of the purchase price, repaid over time. This can complement a traditional loan.

Get Your Finances (and Story) in Order

Think of your loan application as a pitch. You're showing the lender why this purchase makes sense and why you're the right person to take the business forward.

Here's what you'll typically need:

Personal information:

• Proof of identity
• Credit history and score
• Evidence of your assets and liabilities

Business information:

• Financial statements from the business you're buying
• Purchase price and contract details
• Cash flow forecasts showing how you'll manage repayments
• Business plan outlining your goals, marketing, and operations strategy

Your experience matters:

Lenders love seeing that you understand the industry. If you've managed a team, run a business before, or have relevant qualifications, include this. A strong personal background can make your application stand out especially if the business's numbers are solid but you're seeking a high loan-to-value ratio.

How to Apply for the Loan (Step by Step)

Once you've gathered your documents and found a lender or broker you're comfortable with, here's how the process usually flows:

Step 1: Initial consultation or pre-assessment

Discuss your goals, the business you're buying, and your borrowing capacity. The lender will give you an idea of what you can afford and what documentation they'll need.

Step 2: Submit your formal application

Provide all your financial details, the business's financials, and your business plan. The more complete your application, the faster it moves.

Step 3: Lender assessment and valuation

The lender reviews the business's performance, value, and your ability to service the loan. They may commission an independent valuation or request extra information.

Step 4: Conditional approval

If your application looks solid, you'll receive conditional approval, meaning you're likely to get the loan as long as all checks come back positive.

Step 5: Final approval and loan offer

Once the lender is satisfied, you'll receive formal approval and a loan contract outlining your terms, repayment schedule, and any security required.

Step 6: Settlement

Funds are released to complete the business purchase. The lender might pay the seller directly or deposit the funds into your nominated account.

After Approval: Buying and Transitioning the Business

Once your loan is approved, it's time to move from financing to ownership mode.

Here's what to do next:

Finalise the sale contract

Work with your solicitor or conveyancer to make sure all conditions of the sale are met, including any adjustments for stock, assets, or prepaid expenses.

Transfer licenses and registrations

Depending on the industry, you may need to update business registrations, transfer ABNs, or reapply for permits. Don't forget insurance, your policy should be active from day one.

Open new accounts and update payment systems

Set up your business bank account, payment terminals, and accounting software under your name or company. If the business uses subscriptions or supplier accounts, update billing information right away.

Communicate with staff and customers

Introduce yourself as the new owner, reassure employees, and maintain continuity. This helps protect the goodwill you've just paid for.

Start monitoring your performance

Track cash flow closely in the first few months. Use digital tools to keep tabs on revenue, expenses, and loan repayments. Lenders like to see strong management and it helps you spot early challenges.

Practical Tips for a Smooth Loan Journey

• Use a finance broker: They'll help match you with lenders that understand business purchases and can save you time and stress.
• Have a deposit ready: Most lenders expect you to contribute 10–30% of the purchase price.
• Don't rush the numbers: Build a realistic forecast, lenders can spot overly optimistic assumptions quickly.
• Check the business's existing debts: You don't want to inherit liabilities that could affect your loan repayments.
• Think long-term: Your lender may offer a better rate or terms if you can demonstrate potential for growth or diversification.

Turning the Loan into Growth

Buying a business is just the start, how you run it afterward determines your success. Once you've settled in, focus on strategies that strengthen your cash flow and business value:

• Streamline costs and negotiate supplier deals.
• Introduce new products or marketing channels.
• Keep an emergency buffer for unexpected expenses.
• Review your loan annually. You might refinance later at a lower rate once the business proves itself under your ownership.

Final Word

Applying for a business loan to buy a business isn't just about ticking boxes, it's about showing lenders (and yourself) that you understand what you're buying and how you'll make it thrive.

Do your homework, get your documents in order and don't hesitate to lean on a professional.

Ready to go? Click here to find a business broker in your local area.

AnyBusiness.com.au

Curtis is a leading expert in the business-for-sale industry, serving as a senior content creator at anybusiness.com.au.

With a career spanning over fifteen years, Curtis has accumulated extensive knowledge in the domain of business sales, acquisitions, and valuations. His deep understanding of market dynamics and his ability to translate complex industry jargon into accessible insights make him a trusted resource for entrepreneurs and business owners looking to buy or sell businesses.

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