Most buyers fund their deposit from savings, sometimes alongside family money, co-investors or support from the seller. Lenders want to know where it comes from, and borrowing it brings risks of its own.
Common sources
- Savings: the simplest, and what lenders like most.
- Family or friends: lenders will want to know whether it's a gift or a loan that has to be repaid.
- Co-investors: partners who put money in alongside you, usually for a share of the business.
- Vendor support: the seller deferring part of the price, which reduces the cash you need. See What is vendor finance?.
- Borrowing against your home: possible, but your home is then at risk if things go wrong.
- A Start Up Loan, either to fund a smaller purchase or as part of your deposit alongside other acquisition finance. It's a personal loan you repay yourself. See Can I use a Start Up Loan or the Growth Guarantee Scheme to buy a business?.
Why lenders care where it comes from
Money you've borrowed to fund your deposit is still debt you have to repay, on top of the business's own borrowing. Lenders look at your whole position, not just the size of your contribution.
Don't stretch too far
A deposit funded entirely by borrowing leaves little room if trading dips after completion. We regularly see buyers come back soon after a deal needing working capital, or needing to refinance the deal loan or the seller's deferred payments. Those are signs of an underfunded purchase. See Can I buy a business with no money down?.
Last reviewed: 8 October 2026