SBA 7(a) Q&A
Short answer
If a buyer fails to provide proof of their required equity injection by closing, the loan cannot proceed, and the deal will likely fall apart.
The equity injection is a fundamental requirement of an SBA 7(a) loan, demonstrating the borrower's commitment and reducing leverage. Lenders must verify the injection is completed and documented prior to or at closing. Without it, the loan is not compliant with SBA regulations.
A buyer needs a $100,000 cash injection for a $1 million acquisition. If on the closing date, the funds are not in the business's account and verified by the lender, the closing will be delayed or cancelled.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
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 down payment & equity injection
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