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Succession · Partner Exit · Shareholder Buy-Out

Business Loan to
Buy Out a Partner

Name: Mortgagefy
Address: Sydney, NSW, AU
Telephone: +61432634648
Price range: Free

By the Mortgagefy Team · Credit Rep 532656 of ACL 348324 · Published 2026-10-15 · Last reviewed 2026-10-15

Fund a partner buy-out, shareholder exit or management buy-in. Specialist succession lenders will structure the facility against the business goodwill + personal guarantees, 5-10 year terms.

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Free Business & Commercial Assessment

Takes under 3 minutes. We'll match you with the right lender for your situation.

Who this is for

Business owners buying out a partner, shareholder or sibling - keeping the business trading smoothly through the transition.

50/50 partnership where one partner is exiting
Family business succession (parent to child, sibling buy-out)
Shareholder exit in a Pty Ltd structure
Management buy-in (MBI) or buy-out (MBO)
Franchisee buying out a co-franchisee
Equity re-balance after a long-term partnership shift

The real challenge

Partner buy-outs are a specific lending category. The lender funds against the enterprise value of the business (goodwill + plant + working capital), supported by personal guarantees from the remaining partner(s). Mainstream banks are often conservative here; specialist succession lenders will structure 5-10 year terms with step-down guarantee releases.

The structure matters: equity transfer vs asset sale, trust vs company, timing of the GST and CGT events. We work with your accountant to structure the deal so the lender approves cleanly.

How Mortgagefy helps

Specialist succession lenders. We know which lenders will fund 70-80% of enterprise value for a partner buy-out.
Structure coordination with your accountant and lawyer so the deal structure matches the lender's policy.
Earn-out or vendor finance options where the outgoing partner stays as a secondary financier.
Honest serviceability run on the business cash flow + remaining partner(s) personal income.

Need to model repayments first? Try our Sydney home-loan calculators for an indicative figure.

How it works

Initial scoping

Buy-out value, business EBITDA, your personal position, outgoing partner's expectations.

Structure design

Work with your accountant on share vs asset transfer, GST / CGT implications.

Lender shortlist

2-3 specialist succession lenders matched to the deal size.

Settlement

Facility settles, shares transfer, outgoing partner paid out.

Get a personalised answer in 2 minutes

Free, no obligation. We'll match you with the right lender for your situation.

Frequently asked questions

How much can I borrow to buy out a partner?

Typically 70-80% of agreed enterprise value, repaid over 5-10 years from business cash flow. Deposit funded from retained earnings, personal savings or vendor finance from the outgoing partner.

What's an earn-out?

Structure where part of the buy-out price is paid over 2-3 years, contingent on the business maintaining agreed revenue or profit targets. Reduces upfront capital need and aligns the outgoing partner with a smooth handover.

Can the outgoing partner stay as a vendor financier?

Yes - common structure. The outgoing partner takes a secured promissory note for 20-40% of the buy-out value, repaid over 3-5 years alongside the bank facility. Reduces the lender advance needed.

What personal guarantees will I need to give?

For succession loans, remaining directors typically give full personal guarantees. Some specialist lenders will structure capped or step-down guarantees that reduce as the loan amortises.

Will the ATO treat the buy-out as a dividend?

Depends on the structure. Share buy-back can be treated as a deemed dividend (Div 7A implications); asset sale is CGT. Your accountant needs to model both; this materially affects after-tax cost.

How long does a buy-out loan take to approve?

4-8 weeks typical for a secured succession facility (valuation + due diligence takes time). Smaller deals under $500k can approve in 2-3 weeks.

Get your free partner buy-out assessment

70-80% of enterprise value, 5-10 year terms. Structured with your accountant for clean lender approval.

Start Your Free Assessment Call 0432 634 648

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Information checked October 2026. This information is general in nature and does not take account of your personal objectives, financial situation or needs. Business, commercial and development finance eligibility, pricing and documentation varies by lender and changes frequently. Confirm current requirements with your chosen lender and seek professional advice before applying. Mortgagefy — Credit Representative 532656 of ACL 348324.

Business Loan toBuy Out a Partner