SBA 7(a) Q&A
Short answer
Equity injection is the buyer's required contribution of cash or eligible assets into the business, demonstrating commitment and reducing the overall loan-to-value.
The SBA mandates that buyers inject a portion of the project costs, typically at least 10%, from their own verified liquid assets or other eligible sources. This "skin in the game" requirement ensures the borrower has a personal stake and helps maintain prudent leverage levels.
For a $900,000 business purchase, the buyer's equity injection would generally be a minimum of $90,000, which could come from cash, a fully standby seller note, or eligible assets.
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
SBA Form 1919 - Borrower Information Form
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.
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