SBA 7(a) Q&A
Short answer
Yes, working capital from an SBA 7(a) loan can be used to repay business credit card debt incurred during the acquisition process, provided these expenses were eligible project costs and properly documented.
SBA 7(a) loan proceeds for working capital can be used to pay off short-term debt, including business credit card debt, that was legitimately incurred for eligible acquisition-related expenses (e.g., initial inventory, supplies, or minor equipment purchased before closing). The lender will require documentation to verify that these credit card charges were for eligible business purposes and not personal expenses.
You used a business credit card to pay $15,000 for initial inventory and marketing materials for the acquired business before the SBA loan closed. The $50,000 working capital portion of your $700,000 SBA loan can be used to pay off that $15,000 credit card balance.
Insider move
Lenders will meticulously review credit card statements and invoices to ensure that all charges are legitimate business expenses related to the acquisition or initial operations. They want to avoid using SBA funds for ineligible or personal expenses.
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 2026-06-13. 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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