Business acquisition
SBA Loans to Buy a Business
SBA 7(a) loans are one of the most common ways to finance buying an existing business — often up to $5 million, with as little as 10% down and terms up to 10 years.
Why SBA for acquisitions
Lower down payments and longer terms than most conventional acquisition loans, so more of the business's cash flow stays with you.
What lenders look for
The target business's cash flow (to cover the loan), your industry experience, and a fair valuation. Seller financing can help cover the equity injection.
Typical structure
7(a) up to $5M, ~10% down, 10-year term for a business without real estate (longer if real estate is included).
Frequently asked
How much can I borrow to buy a business with an SBA loan?
SBA 7(a) loans go up to $5 million. The amount you qualify for depends mainly on the target business's cash flow and the purchase price.
How much down payment do I need?
Typically around 10% equity injection, and part of that can sometimes come from seller financing on standby.
Other ways businesses use SBA loans
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