SBA 7(a) Q&A
Short answer
Yes, an SBA 7(a) loan can finance up to 100% of the goodwill in a business acquisition, provided the overall loan-to-value is acceptable and the business cash flow supports the debt.
The SBA permits financing of goodwill as part of a business acquisition. Unlike some conventional loans, there isn't a specific cap on the percentage of goodwill that can be financed by the SBA 7(a) loan, as long as the entire project is supported by a sound business valuation and the borrower's equity injection.
If a $1,500,000 acquisition includes $1,000,000 in goodwill and $500,000 in tangible assets, the SBA loan can theoretically finance all $1,000,000 of the goodwill, assuming the 10% equity injection is met on the total project cost.
While goodwill is financeable, lenders are highly focused on the business's historical and projected cash flow to service debt, especially when a large portion of the purchase price is goodwill. They also rely heavily on a robust business valuation.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-13. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-13 · SBA sources checked through 2026-06-13. 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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