SBA 7(a) Q&A
Short answer
No, an SBA 7(a) loan cannot finance 100% of an existing partner's share buyout. The SBA requires a minimum equity injection from the buyer, typically 10-25% of the purchase price, to ensure the buyer has invested capital 'at risk'.
For any change of ownership, including a partner buyout, the SBA requires the buyer to inject a certain percentage of equity. This ensures the buyer has a vested interest in the business's success and reduces the risk to the lender and the SBA. The exact percentage can vary based on the lender's credit policy and transaction specifics.
If you are buying out your partner's 50% share of a business for $500,000, the SBA loan could finance up to $450,000. You would typically need to provide at least $50,000 (10%) in cash or other eligible equity for the transaction.
Insider move
Lenders need to ensure the buyer has sufficient 'skin in the game' to motivate successful business operation. They will verify the source and sufficiency of the buyer's equity injection according to SBA guidelines and their internal credit standards.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
7(a) Loan Program — Terms, Conditions, and Eligibility
U.S. Small Business Administration · Official SBA source
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.
More on partner buyouts
Terms in this answer
Pre-qualify your SBA 7(a) deal
Tell us the business, the price, and where you are — we'll point you to the lenders most likely to fund a deal like yours and flag anything that trips up approval.
Free · No documents · Usually same-day