SBA 7(a) Q&A
Short answer
For most business acquisitions with an SBA 7(a) loan, a minimum of 10% equity injection is required. While some non-cash assets can count, a significant portion is typically expected to be cash from the buyer.
The SBA requires a minimum equity injection, typically 10% of the total project costs, for business acquisitions. The equity injection must be unencumbered and from the borrower's personal resources or certain eligible third-party sources. Lenders will verify the source and sufficiency of these funds.
For a $700,000 business acquisition, the total project cost might be $750,000 including fees and working capital. A 10% equity injection would be $75,000. The lender expects a substantial portion of this $75,000 to be liquid cash from the buyer.
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 2026-06-14. 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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