SBA loan basics
Short answer
While there's no fixed percentage, most SBA 7(a) loans require a minimum equity injection (down payment) from the borrower, typically ranging from 10% to 30% of the project cost, depending on the business and deal type.
The SBA requires the borrower to have sufficient equity in the business to demonstrate a personal stake and reduce the lender's risk. The exact percentage depends on factors like whether it's a startup, an acquisition, or an existing business.
To buy an existing business for $500,000, a buyer might need to inject 10% cash ($50,000) as a down payment. For a startup, this injection could be 20-30% ($100,000-$150,000).
Insider move
Lenders want to see a meaningful personal investment from the owner to ensure commitment and mitigate risk. They verify the source and availability of these funds to ensure they are truly from the borrower.
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 down payment & equity injection
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