Business Loan Down Payment Calculator
Work out how much cash you need to buy a business and whether your available cash covers it.
Acquisition costs
Use the full price before deducting vendor finance or deposits.
Cash the business needs at settlement.
Committed funding
Enter the amount available at settlement.
Enter the part of the price the seller agrees to defer.
For example, funds from an outside investor at settlement.
Buyer cash
Include deposits already paid if they count towards the price.
Results
Required buyer cash
$115,000
Remaining funding gap
$25,000
Cash surplus
$0
Total acquisition uses
$565,000
Committed non-buyer funding
$450,000
Contribution share of price
Uses the funding available at settlement. The opening figures are a hypothetical example.
Build the Acquisition Sources and Uses
Add the full purchase price, transaction costs and working capital needed at settlement. The sum is your total acquisition uses. Subtract the agreed loan funding, vendor finance and other committed funding to find the cash the buyer needs to contribute.
Use the full purchase price when part of it is covered by a seller loan. A settlement balance of $400,000 after a $100,000 vendor loan means the full price is $500,000. Enter $500,000 as the purchase price and $100,000 as vendor finance. Using the settlement balance as the price would deduct the seller’s loan twice.
If committed non-buyer funding already exceeds acquisition uses, required buyer cash is $0. The calculator shows the excess as a cash surplus even if the buyer has no cash to add.
Work Out the Buyer’s Cash Gap
In the hypothetical example, the $500,000 price, $25,000 in transaction costs and $40,000 in working capital add up to $565,000. The $350,000 loan and $100,000 in vendor finance cover $450,000, leaving a $115,000 buyer contribution.
The buyer has $80,000 on hand and has already paid a $10,000 refundable deposit. The deposit counts towards the purchase price at settlement. Enter $90,000 as available buyer cash to leave a $25,000 funding gap. A deposit due back to the buyer is excluded until that cash is available for the purchase.
Interpret the Contribution Before Agreeing Terms
The required contribution is 23% of the $500,000 purchase price in this example. The percentage describes the cash needed for these figures. Any minimum equity the lender requires is set separately under its own terms.
Keep uncommitted funds and amounts released after settlement out of the settlement calculation. If $100,000 of the example loan arrives later, enter $250,000 as agreed loan funding at settlement. The gap increases to $125,000. Add any contingency you need at settlement to the relevant cost or working capital figure.
A balanced plan shows that the entered sources cover the entered costs. Business valuation and the buyer’s ability to repay the loan need separate assessment. The Australian Government’s business loan guide explains how to assess cash flow and apply to a lender for approval.
