SBA 7(a) Q&A
Short answer
There is no specific maximum percentage of a business acquisition that can be attributed to goodwill for an SBA 7(a) loan. The SBA program allows for the financing of goodwill as part of a business acquisition.
Unlike some conventional loans, SBA 7(a) loans are well-suited for business acquisitions that include a significant goodwill component. The SBA does not set a cap on the percentage of goodwill, but the total purchase price, including goodwill, must be supported by a sound business valuation.
If you acquire a service business for $1,500,000, and $1,200,000 of that value is attributed to goodwill based on recurring customer contracts and brand reputation, the SBA 7(a) loan can still finance this acquisition, assuming the valuation is justified.
Lenders will carefully review the independent business valuation to ensure the goodwill is reasonable and supportable by the business's earnings, customer base, and market position. While no cap exists, an excessive goodwill component without strong justification may raise concerns about the business's underlying value.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-14. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-14 · SBA sources checked through 2026-06-14. 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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