SBA 7(a) Q&A
Short answer
The minimum equity injection for a business acquisition is typically 10-25% of the total project cost, irrespective of the goodwill component.
For a business acquisition, the SBA generally requires a minimum equity injection of 10% of the total project cost. However, many lenders, especially for acquisitions with significant goodwill, may require 15-25% to mitigate risk. The total project cost includes the purchase price, working capital, and other eligible expenses.
If you are buying a business for $1,000,000, and $700,000 of that is goodwill, the required minimum equity injection of 10% ($100,000) is calculated on the full $1,000,000 purchase price, not just the tangible assets.
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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