In 2025, SBA loans remain one of the most accessible ways for aspiring entrepreneurs to acquire an existing business. If you’re wondering “How do I get an SBA loan to buy a business?”, you’re not alone. It’s one of the top searches among professionals looking to leave their 9-to-5 jobs and step into entrepreneurship.
Unlike starting from scratch, buying a business comes with immediate cash flow, customers, and a proven model. The Small Business Administration (SBA) backs loans that make this path more realistic—even if you don’t have hundreds of thousands saved.
This guide walks you through the SBA loan process step-by-step with real examples, lender insights, credit and collateral tips, and how Azgari can help you find, qualify for, and buy your ideal business.
→ Want help navigating SBA loan qualification and buying the right business? Book a free Azgari strategy call
What Is an SBA Loan and Why Use It to Buy a Business?
The SBA (Small Business Administration) doesn’t lend money directly—it guarantees a portion of loans made by approved lenders (usually banks or credit unions). This reduces risk for the lender and improves your chances of approval.
Key Benefits of SBA Loans for Acquisitions:
- Low down payment: Typically 10%–20% of the purchase price
- Long repayment terms: Up to 10 years
- Competitive interest rates: Often 6%–8% in 2025
- Flexible use: You can use it to buy assets or entire entities
- No need for full collateral if cash flow supports repayment
SBA loans make it easier to transition from employee to owner without depleting your savings or relying entirely on private capital.
→ Want to buy a business with just 10% down? Azgari shows you how to use SBA 7(a) loan
Step-by-Step: How to Get an SBA Loan to Buy a Business
1. Find a Qualified Business to Buy
Before any lender talks seriously, you need a vetted business on the table.
What Makes a Business Lendable:
- At least 2–3 years of positive cash flow
- Clean financial records (tax returns, P&Ls, balance sheets)
- Owner willing to sell and participate in the transition
- Recurring revenue or contract base preferred
- Stable customer base and minimal seasonality
Example: Maria wanted to buy a mobile grooming business in Phoenix listed for $180,000. The seller had 3 years of books and $60K in annual net income—perfect for SBA underwriting.
Tips for Finding the Right Business:
- Work with business brokers who specialize in SBA-approved deals
- Browse marketplaces like BizBuySell and Axial
- Attend local chamber of commerce or small business networking events
→ Need help finding vetted businesses that qualify for SBA lending? Azgari helps with deal sourcing
2. Choose the Right SBA Loan Program
The SBA 7(a) loan is the most common product used for business acquisition.
SBA 7(a) Loan Basics:
- Loan amounts up to $5 million
- Terms up to 10 years for business purchases
- 75%–85% guaranteed by SBA
- Can include working capital and equipment
For real estate-heavy acquisitions, the SBA 504 loan may be more suitable, though it’s less common for small service-based business buys.
→ Confused by loan types? Azgari breaks down SBA 7(a) vs. Express vs. 504 options
3. Prepare Your Personal Financial Profile
Lenders evaluate YOU as much as the business.
You’ll Need:
- Credit Score: 680+ recommended
- Resume: Industry or management experience preferred
- Net Worth Statement: Assets vs. liabilities
- Liquidity: Down payment + 3–6 months reserves
Example: Darnell, a former logistics manager, had a 720 credit score and $45K saved. He used $30K for a down payment on a $250K business and secured an SBA loan for the rest.
Other eligibility factors:
- U.S. citizenship or lawful permanent residency
- No bankruptcies or loan defaults in recent years
- Demonstrated ability to repay through business cash flow
4. Assemble Required Document
Proper documentation is critical.
From You (the Buyer):
- Personal financial statement
- Tax returns (last 3 years)
- Resume or bio
- Business plan with projections
From the Seller:
- Last 3 years of tax returns
- Year-to-date P&L and balance sheet
- Business valuation (from CPA or broker)
- List of assets and inventory
- Copy of lease (if applicable)
Also expect to sign forms like:
- IRS Form 4506-T (to verify tax info)
- Personal guarantee forms
- Business acquisition agreement draft
→ Need a lender-ready package? Azgari helps organize and prep your loan docs
5. Get a Professional Valuation
Lenders will want to verify that you’re not overpaying. A certified valuation helps support your loan request.
Typical Valuation Methods:
- SDE (Seller’s Discretionary Earnings) x multiple (2–3x typical)
- Asset-based valuation
- Market comparables
Example: Mike was buying a $300K HVAC business. The valuation came back at $290K, and the bank approved a loan at 90% LTV.
Valuations also help in negotiation—you can request seller financing for the difference between valuation and asking price.
How Much Do You Need to Put Down?
Most SBA lenders require 10%–20% equity injection from the buyer. In 2025, expect the following:
- Business price: $300,000
- Down payment: $30,000–$60,000
- SBA loan: $240,000–$270,000
- Additional: $5,000–$10,000 for closing costs or working capital
Creative Solutions:
- Seller note: Seller finances part of the purchase
- Gift equity: Family member gifts part of the down payment
- Earn-outs: Part of the price paid from future profits
→ Want a no-surprises loan cost breakdown? Let Azgari walk you through it
Timeline: How Long Does It Take?
| Stage | Timeline |
| Prequalification | 1–2 weeks |
| Business due diligence | 2–3 weeks |
| Loan application + underwriting | 3–5 weeks |
| Closing + funding | 1–2 weeks |
| Total | 6–10 weeks |
Keep in mind that delays can occur if the seller is unprepared or if documentation is incomplete.
Example: Erica started her process in January and was operating her new business by mid-March.
Common Mistakes to Avoid
- Inadequate documentation (especially tax returns)
- Buying from a seller who can’t prove income
- Overestimating your ability to run the business
- No plan for transition or training
- Underestimating working capital needs
- Failing to vet the customer base and vendor relationships
Tip: Lenders LOVE buyers who have support or mentorship lined up.
→ Azgari offers transition planning, business coaching, and hands-on launch support. Book your call
Why Azgari Is Your SBA Business Buying Partner
Buying a business through SBA financing is one of the smartest wealth-building plays in 2025—but it’s also paperwork-heavy and filled with landmines.
Azgari helps you:
- Find SBA-eligible businesses
- Build your buyer package
- Partner with top SBA lenders
- Avoid overpriced or high-risk deals
- Launch with training, branding, and growth plans
- Prepare for long-term ownership and expansion
Real Azgari Success Story:
Angela, a corporate HR manager, worked with Azgari to buy a home cleaning business listed at $225K. She secured an SBA loan for 90% of the purchase, received 3 weeks of seller training, and crossed $10K/month in revenue by month 2.
→ Let Azgari help you go from employee to business owner with the power of SBA lending. Start here
Conclusion: SBA Loans Can Be Your Shortcut to Ownership
If you want to skip the risky startup phase and step into a cash-flowing business, SBA financing is a powerful option.
In summary:
- You can buy a business with as little as 10% down
- Terms are favorable and include working capital
- The process takes 6–10 weeks
- Azgari can help you find and buy the right business, fast
Don’t let paperwork or fear stop you from building wealth and freedom.
→ Want to know if you qualify for SBA financing? Let’s talk. Book a free consultation today
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