SBA 7(a) Q&A
Short answer
For a partner buyout structured as a change of ownership, the minimum equity injection requirement is typically 10% of the total project costs, similar to other business acquisitions.
A partner buyout is treated as a change of ownership transaction. The SBA requires a minimum of 10% equity injection from the acquiring owner(s) based on the total project costs (which include the purchase price, working capital, and other associated fees). This ensures the buyer has a vested interest in the business.
If the total project cost for buying out your partner, including the purchase price and any working capital, is $500,000, you would need to inject at least $50,000 (10%) as equity.
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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