SBA 7(a) Q&A
Short answer
Yes, an SBA 7(a) loan's working capital component can include funds for a security deposit on a leased property if it's necessary for the acquired business's operation.
Working capital funds are intended to cover eligible operational expenses and initial costs for the acquired business. A security deposit for a leased business property is a legitimate and necessary expense to establish operations and is therefore an eligible use of working capital.
If you're buying a business that leases its space and the landlord requires a $15,000 security deposit, this amount can be included in the working capital portion of your $400,000 SBA 7(a) acquisition loan.
Insider move
Lenders ensure the security deposit amount is reasonable and customary for the lease agreement. They will review the lease terms and verify the necessity of the deposit as a valid business expense to be financed through the loan's working capital.
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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