{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/how-much-cash-must-i-personally-contribute-to-the-equity-injection-for-a-1-000-000-busines","api_url":"https://dealroom.so/api/public/questions/how-much-cash-must-i-personally-contribute-to-the-equity-injection-for-a-1-000-000-busines","question":"How much cash must I personally contribute to the equity injection for a $1,000,000 business acquisition?","topic":"Cash Equity Requirements","audience":"borrower","bot_mode":"buyer","short_answer":"Typically, a minimum of 10% of the total project cost is required as equity injection, with at least half of that being from the buyer's unencumbered cash.","rule":"SBA rules generally require a minimum 10% equity injection for a change of ownership. For an acquisition, at least 5% of this 10% must come from the borrower's personal, unencumbered cash. The remaining 5% can come from other eligible sources, such as a fully-standby seller note or investor funds.","example":"For a $1,000,000 acquisition, the total project cost might be $1,100,000 including fees and working capital. A 10% equity injection would be $110,000. At least $55,000 must be your personal cash, with the rest potentially a standby seller note or other eligible funds.","what_lenders_check":"Lenders rigorously verify the source and seasoning of the cash injection to ensure it is truly unencumbered and not borrowed, which would undermine the borrower's commitment. They look for bank statements covering at least 90 days.","required_facts":["Total project cost","Buyer's cash","Equity injection percentage","Source of funds"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","13 CFR Part 120 - Business Loans","7(a) Loan Program Terms, Conditions, and Eligibility"],"official_sources":[{"title":"SOP 50 10 - Lender and Development Company Loan Programs","url":"https://www.sba.gov/sites/default/files/2025-05/SOP%2050%2010%208%20Technical%20Updates%20effective%206.1.2025.docx"},{"title":"13 CFR Part 120 - Business Loans","url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120"},{"title":"7(a) Loan Program Terms, Conditions, and Eligibility","url":"https://www.sba.gov/partners/lenders/7a-loan-program/terms-conditions-eligibility"}],"related_questions":[],"related_terms":[{"term":"Non-Cash Equity Injection","url":"https://dealroom.so/glossary/non-cash-equity-injection"},{"term":"Cash injection","url":"https://dealroom.so/glossary/cash-injection"},{"term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"term":"Cash equity","url":"https://dealroom.so/glossary/cash-equity"},{"term":"Minimum cash injection","url":"https://dealroom.so/glossary/minimum-cash-injection"},{"term":"Minimum Equity Injection","url":"https://dealroom.so/glossary/minimum-equity-injection"}],"related_tools":[{"name":"SBA 7(a) payment & fee calculator","url":"https://dealroom.so/sba-7a/calculator"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-13","sba_rule_sources_checked_through":"2026-06-13"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-7a/questions/how-much-cash-must-i-personally-contribute-to-the-equity-injection-for-a-1-000-000-busines","source_type":"DealRoom Q&A"},"caveats":["Grounded in the current SBA rulebook; verify against official sources before relying on it for a live deal.","Not legal, tax, or financial advice and not an approval decision."]}