For Buyers
September 2026 · 6 min read
Financing A Practice Purchase: What Lenders Want To See
What the major banks and the BDC ask for, how vendor take-backs are structured, and where first-time buyers stumble.
Most accounting practice purchases in Canada are financed with a mix of three things: a bank or BDC term loan, a vendor take-back from the seller, and the buyer’s own equity. A typical $700,000 purchase might be 50 to 60 percent bank debt, 20 to 30 percent vendor financing and 10 to 20 percent cash. Lenders like accounting practices because the revenue is predictable and the borrower is, by definition, good with numbers.
What a lender wants to see is simple to list and slow to assemble. Three years of the practice’s financial statements. A schedule of revenue by service line and by client, with the largest clients identified. The staff schedule with tenure and compensation. The lease. A transition agreement showing how long the seller stays. And a projection for the first two years under the buyer’s ownership, with the loan payments in it.
The buyer’s own file matters as much. A CPA designation, a few years of public practice experience and a clean personal credit history make the loan easy. Lenders are wary of buyers with no practice experience, and of practices where the seller’s personal relationships are the business. A written transition plan addresses the second concern; relevant experience addresses the first.
Vendor take-backs do two jobs. They close the gap when the bank will not lend the whole price, and they signal to the bank that the seller believes the clients will stay. A seller who refuses any deferred payment is telling the lender something. A seller who offers 20 to 30 percent over two years is making the loan easier to approve and usually gets a better price for it.
Where first-time buyers stumble: they approach the bank before they have the package, they underestimate working capital in the first tax season, and they negotiate price without negotiating structure. A broker who has done this before prepares the lender package before the offer, so financing is a formality rather than a condition.
Registered buyers with us receive the lender-ready package for any listing they request. If you are a year away from buying, the best preparation is to talk to a lender now about what they would need from you, and to register so you see what practices are actually selling for.
Talk To A Broker
Angela Moreau, CPA, CGA covers British Columbia And Alberta. The first conversation is free and confidential.
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