SBA loan basics
Short answer
Yes, an SBA 7(a) loan can be used to finance the buyout of a departing business partner. This is a common use for businesses where one owner wishes to purchase another's share.
SBA 7(a) loans are eligible for financing a change of ownership, including the buyout of a business partner's interest. The remaining partner (or partners) can use the loan proceeds to purchase the equity of the departing partner. This typically involves a business valuation to determine the fair market value of the share being purchased, and the transaction must adhere to all SBA equity injection and eligibility requirements.
If one partner wants to sell their 50% share of a successful consulting business for $200,000, the remaining partner can apply for an SBA 7(a) loan to finance the buyout, allowing them to gain full ownership.
Insider move
Lenders will require a business valuation to ensure the buyout price is fair and reasonable. They also assess the financial strength of the remaining owner(s) and the business's projected cash flow to service the new debt post-buyout.
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 2026-06-13. 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 what it can be used for
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