{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/what-is-the-debt-to-worth-ratio-requirement-for-a-0-down-partner-buyout","api_url":"https://dealroom.so/api/public/questions/what-is-the-debt-to-worth-ratio-requirement-for-a-0-down-partner-buyout","question":"What is the debt-to-worth ratio requirement for a $0-down partner buyout?","topic":"Partner & owner buyout","audience":"borrower","bot_mode":"buyer","short_answer":"For a $0-down partner buyout, the business's pro forma debt-to-worth ratio must be no greater than 9:1 after the loan closes.","rule":"The pro forma debt-to-worth ratio measures the total liabilities of the business relative to its tangible net worth, calculated after the SBA loan funds. For a zero equity injection in a partner buyout, the SBA requires this ratio to be 9:1 or less, indicating a healthy financial structure.","example":"If a business has $900,000 in debt and $100,000 in tangible net worth after the buyout loan, its debt-to-worth ratio is 9:1, qualifying for the 0% injection. If it had $950,000 in debt and $100,000 in net worth, the ratio would be 9.5:1, requiring a 10% injection.","what_lenders_check":"Lenders perform a detailed financial analysis to project the business's balance sheet post-transaction. They meticulously calculate the pro forma debt-to-worth ratio, ensuring it complies with the 9:1 threshold required for the 0% equity injection.","required_facts":["Pro forma calculation","9:1 maximum ratio","Debt relative to worth","0% injection condition"],"source_families":["SOP 50 10 — Lender and Development Company Loan Programs"],"official_sources":[{"title":"SOP 50 10 — Lender and Development Company Loan Programs","url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs"}],"related_questions":[{"question":"Can I buy out my business partner with an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/can-i-buy-out-my-business-partner-with-an-sba-7-a-loan"},{"question":"Can a partner buyout be done with zero money down under the SBA?","url":"https://dealroom.so/sba-7a/questions/can-a-partner-buyout-be-done-with-zero-money-down-under-the-sba"},{"question":"What is the 24-month ownership rule for a $0-down SBA partner buyout?","url":"https://dealroom.so/sba-7a/questions/what-is-the-24-month-ownership-rule-for-a-0-down-sba-partner-buyout"},{"question":"Is a partner buyout a complete or partial change of ownership for the SBA?","url":"https://dealroom.so/sba-7a/questions/is-a-partner-buyout-a-complete-or-partial-change-of-ownership-for-the-sba"},{"question":"Does the remaining owner have to personally guarantee the SBA loan after a buyout?","url":"https://dealroom.so/sba-7a/questions/does-the-remaining-owner-have-to-personally-guarantee-the-sba-loan-after-a-buyout"},{"question":"Can the company itself redeem the departing partner's shares with an SBA loan?","url":"https://dealroom.so/sba-7a/questions/can-the-company-itself-redeem-the-departing-partner-s-shares-with-an-sba-loan"}],"related_terms":[{"term":"Buyout of a Partner","url":"https://dealroom.so/glossary/buyout-of-a-partner"},{"term":"Partner buyout","url":"https://dealroom.so/glossary/partner-buyout"},{"term":"Debt-to-equity ratio","url":"https://dealroom.so/glossary/debt-to-equity-ratio"},{"term":"Debt-to-Income Ratio","url":"https://dealroom.so/glossary/debt-to-income-ratio"},{"term":"Owner Buyout","url":"https://dealroom.so/glossary/owner-buyout"},{"term":"Personal Debt-to-Income Ratio","url":"https://dealroom.so/glossary/personal-debt-to-income-ratio"}],"related_tools":[{"name":"Partner Buyout toolkit","url":"https://dealroom.so/sba-7a/partner-buyout"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-15","sba_rule_sources_checked_through":"2026-06-15"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-7a/questions/what-is-the-debt-to-worth-ratio-requirement-for-a-0-down-partner-buyout","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."]}