“How much can I borrow?” is usually the first question business owners ask. It’s also the one most likely to produce a misleading answer.

Online calculators and simple EBITDA multiples offer precision, but real borrowing capacity is a range, not a fixed figure. Where a business sits within that range depends on how lenders interpret risk.

Cash flow is typically the true constraint. Lenders look for resilience and headroom, not just technical affordability. They assess how the business performs under pressure, not only at its peak. Asset value helps, but it rarely overrides weak serviceability.

Structure also shapes outcomes. Term, amortisation and covenants can materially affect what feels comfortable in practice.

The “maximum” is rarely the right target. A sustainable figure is one that still works if conditions tighten and doesn’t restrict future flexibility.

If you’d like to understand what your business could realistically support, you can book a no-pressure commercial finance call with Otium Partners.

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