{"ok":true,"canonical_url":"https://dealroom.so/sba-loans/basics/what-if-i-don-t-have-enough-cash-for-the-down-payment-myself-are-there-other-options","api_url":"https://dealroom.so/api/public/questions/what-if-i-don-t-have-enough-cash-for-the-down-payment-myself-are-there-other-options","question":"What if I don't have enough cash for the down payment myself? Are there other options?","topic":"Down payment & equity injection","audience":"new","bot_mode":"buyer","short_answer":"Yes, besides cash, an equity injection can sometimes include eligible seller notes on full standby, or existing business assets. However, a significant cash component is usually preferred and often required.","rule":"The SBA generally requires at least 10% equity injection for business acquisitions. This can be met with cash, a seller note (where the seller delays payment and accepts no payments for the life of the SBA loan), or other assets valued at fair market value. For seller notes, they must be on 'full standby' for the life of the SBA loan, meaning no payments are made to the seller.","example":"A buyer is purchasing a business for $1,000,000. Instead of putting down $100,000 cash, they might contribute $50,000 cash and have the seller provide a $50,000 promissory note that is on full standby for the entire term of the 7(a) loan.","what_lenders_check":"Lenders closely scrutinize the source and structure of non-cash equity injections, especially seller notes, to ensure they meet the strict 'full standby' requirements. Any payment to the seller on a standby note can jeopardize the guaranty.","required_facts":["Cash alternatives","Seller note (standby)","Existing assets","Full standby critical","Minimum 10% typical"],"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","SBA Form 1919 - Borrower Information Form"],"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"},{"title":"SBA Form 1919 - Borrower Information Form","url":"https://www.sba.gov/sites/default/files/2025-03/2025.02.27%20Form%201919%20-%20Updates%20%28FINAL%29_03-12-2025%20%281%29.pdf"}],"related_questions":[{"question":"Can I use retirement funds from a 401(k) as equity injection for a $750,000 business purchase?","url":"https://dealroom.so/sba-loans/basics/can-i-use-retirement-funds-from-a-401-k-as-equity-injection-for-a-750-000-business-purchas"},{"question":"Can funds from a home equity line of credit (HELOC) be used as my equity injection for a business acquisition?","url":"https://dealroom.so/sba-loans/basics/can-funds-from-a-home-equity-line-of-credit-heloc-be-used-as-my-equity-injection-for-a-bus"},{"question":"Is it possible to use a second mortgage on my personal residence as an equity injection for a $1.5 million business acquisition?","url":"https://dealroom.so/sba-loans/basics/is-it-possible-to-use-a-second-mortgage-on-my-personal-residence-as-an-equity-injection-fo"},{"question":"How much cash must I personally inject for an SBA 7(a) business acquisition?","url":"https://dealroom.so/sba-loans/basics/how-much-cash-must-i-personally-inject-for-an-sba-7-a-business-acquisition"},{"question":"What are the acceptable sources for my cash equity injection beyond personal savings?","url":"https://dealroom.so/sba-loans/basics/what-are-the-acceptable-sources-for-my-cash-equity-injection-beyond-personal-savings"},{"question":"What is the SBA's minimum required equity injection percentage for a business acquisition?","url":"https://dealroom.so/sba-loans/basics/what-is-the-sba-s-minimum-required-equity-injection-percentage-for-a-business-acquisition"}],"related_terms":[{"term":"Down payment","url":"https://dealroom.so/glossary/down-payment"},{"term":"Demand for Payment","url":"https://dealroom.so/glossary/demand-for-payment"},{"term":"IRS transcripts (4506-T)","url":"https://dealroom.so/glossary/irs-transcripts"},{"term":"Phase I ESA","url":"https://dealroom.so/glossary/phase-i-esa"},{"term":"Form I-551","url":"https://dealroom.so/glossary/form-i-551"},{"term":"Deferred payment","url":"https://dealroom.so/glossary/deferred-payment"}],"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":"2026-06-14","sba_rule_sources_checked_through":"2026-06-14"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-loans/basics/what-if-i-don-t-have-enough-cash-for-the-down-payment-myself-are-there-other-options","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."]}