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SBA acquisition loans · Full breakdown
An SBA 7(a) loan is still the best tool most buyers have for acquiring a business: up to $5 million, terms up to 10 years without real estate and 25 with it, and a down payment structure a conventional loan rarely matches. The rules tightened in October 2026. Files that ignore that get declined. Ours are built for it.
This page is part of our SBA loans overview.
The short version
Under the SBA rules effective October 1, 2026, a business acquisition must show debt service coverage of at least 1.25x on the business's historical financials. Projections can't carry an acquisition file the way they sometimes can for an expansion. That single rule is why acquisition packaging is a strategy job: the right target, the right structure, and the historicals presented the way an underwriter reads them.
The structure
Your stake
A change of ownership requires buyer cash in the deal, typically at least 10 percent of the total project cost. It proves commitment and it's the first thing an underwriter checks.
The seller's role
A seller note can form part of the injection when it sits on full standby under SBA rules. Structured correctly, it lowers the cash you need at closing without weakening the file.
The proof
Three years of business tax returns and interim financials carry the file. The coverage math runs on what the business has actually done, with add-backs documented, not hoped for.
The price
An independent valuation supports the purchase price. If the price outruns the valuation, the deal structure has to absorb the gap, and we flag that before submission, not after.
The people
Every owner of 20 percent or more personally guarantees the loan. Relevant operating experience matters, and the file should tell that story explicitly.
The terms
Ten years when no real estate is involved, up to 25 when it's. No balloon payment. The monthly payment is what the coverage test is run against.
How the deal moved
We model the deal first: price, injection, seller note, and the coverage math on the target's historicals. If the numbers can't clear 1.25x, you hear it from us before any lender sees the file.
Buyer and business financials, the purchase agreement, the valuation, and a written summary that walks the underwriter through the deal the way they'll underwrite it.
Acquisition appetite varies by lender. We route the file to a lending partner that actively funds changes of ownership, and we stay on it while questions come back.
SBA review, closing documents, and funding. Our compensation is paid by the lending partner out of its closing fees. You never pay us a fee.
Honest edges
Three things, mostly. A price the historicals can't support at 1.25x coverage. An injection assembled from borrowed money that's not disclosed or structured properly. And a buyer whose experience doesn't connect to the business being bought. Every one of those is visible before submission, which is the entire point of having a strategist read the file first. If a target doesn't work, we'll tell you to walk, and mean it: a declined acquisition costs you months, and a bad acquisition costs you years.
Start the short application, or book the free 20-minute Funding Strategy Call and get a straight answer on fit. Both cost nothing, and neither obliges you to anything.
Break Bread Lending, in business since 2022. (888) 818-3781.
The SBA cluster
SBA overview
Every lane, the rules that decide them, and how the packaging works, in one place.
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Micro lane
The smallest, fastest SBA decisions, with the exact document checklist.
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Refinance lane
Roll conventional debt and business cards into one SBA payment at least 10 percent lower.
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The comparison
One underwriter and a queue, or a packaged file routed across lending partners. Compared line by line.
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The full FAQ
Fees, timelines, credit floors, coverage ratios, and documents, answered in plain language.
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