SBA 7(a) Q&A
Short answer
If a departing partner remains as a consultant, the arrangement must be structured to avoid implying retained control or undue influence over the business.
Consulting agreements with departing partners are permissible but must be for a limited duration and at arm's length, with compensation reflecting fair market value for services rendered. The SBA scrutinizes such arrangements to ensure the seller has truly divested and does not retain control or influence over the new ownership.
A departing partner could be hired for a 6-month consulting agreement at $5,000/month to assist with client transitions. The agreement cannot include performance incentives tied to the business's long-term success or options to repurchase shares.
Lenders review the consulting agreement to confirm its arm's length nature, fair compensation, and limited duration. They ensure no provisions suggest the seller retains management authority, decision-making power, or any form of equity or future interest in the business.
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.
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This page answers “What if the departing partner remains involved as a consultant after buyout?” for SBA 7(a) business buyers — a short answer, the detail, and official sources — from DealRoom.so SBA Intelligence. It is general information, not legal, tax, or financial advice, and DealRoom is not a lender.
Source: DealRoom.so SBA Intelligence, based on public SBA, lender, franchise, FDIC, and related records. DealRoom is not a lender and does not guarantee financing.
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