SBA 7(a) Q&A
Short answer
Yes, you can use an SBA 7(a) loan to purchase a business in a different state. The primary requirement is that the business must be located in the United States and operated for profit.
The SBA does not restrict borrowers from purchasing businesses across state lines. The key eligibility criteria focus on the business's location within the U.S. and its operational status as a for-profit entity. Your personal residency is not a limiting factor for the business location.
A buyer living in California wants to acquire a manufacturing business located in Texas. This is fully permissible under SBA 7(a) rules, provided the Texas business meets all eligibility criteria and the buyer intends to operate it from its Texas location.
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.
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