SBA 7(a) Q&A
Short answer
While the SBA doesn't set a hard, universal deadline, lenders typically expect working capital funds to be deployed within a reasonable timeframe post-closing, usually within 6-12 months.
SBA policy generally requires loan proceeds to be used for the authorized purposes within a reasonable time. For working capital, this means that funds should be used for the immediate and near-term operational needs of the business. Funds sitting idle for extended periods might indicate a change in need or intent, which could raise questions from the lender or SBA.
A business acquisition includes $150,000 for working capital. The borrower intends to use these funds for initial inventory, payroll, and a marketing push over the first six months. This planned use within a six-month period is considered reasonable and acceptable.
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 2026-06-13. 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.
More on working capital
Terms in this answer
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