SBA 7(a) Q&A
Short answer
No, accounts receivable (A/R) from the acquired business cannot always serve as *sufficient* collateral on their own. Their value as collateral depends on their age, collectability, and concentration risk.
Accounts receivable are typically included in a blanket lien on business assets. However, lenders will discount their value significantly, especially if they are aged (e.g., over 90 days), or if there's a high concentration with a few customers. A/R rarely fully collateralize a loan alone due to their fluctuating and often uncertain nature.
If a business has $200,000 in accounts receivable, but $150,000 is from a single customer, or a large portion is over 120 days old, the lender may only attribute $50,000-$75,000 of collateral value from that A/R.
Insider move
Lenders assess the quality and collectability of A/R. They worry about customer concentration, slow-paying clients, and the potential for write-offs, which diminish collateral value. They prefer A/R as supplementary, not primary, collateral.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-14. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-14 · SBA sources checked through 2026-06-14. DealRoom analysis of public SBA 7(a) lending records (FY2020–present). Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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