SBA 7(a) Q&A
Short answer
Yes, formal member or board consent is typically required to approve the partner buyout and the associated SBA loan.
Depending on the business's legal structure (e.g., LLC, corporation) and its governing documents, formal consent from the members, board of directors, or shareholders may be legally required to authorize the sale of shares, the purchase by the remaining owner, and the incurrence of new debt (the SBA loan).
For an LLC, a 'Resolution of Members' would be needed, signed by all remaining members, authorizing the buyout and the execution of the SBA loan documents. For a corporation, a 'Board Resolution' would be required.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-15 · SBA sources checked through 2026-06-15. DealRoom analysis of the current SBA 7(a) rulebook for change-of-ownership / partner buyouts. 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.
More on partner & owner buyout
Terms in this answer
← Browse all sba 7(a) questions
Pre-qualify your SBA 7(a) deal
Tell us the business, the price, and where you are — we'll point you to the lenders most likely to fund a deal like yours and flag anything that trips up approval.
Free · No documents · Usually same-day