Funding 2nd Deal When Already Using SBA on First

professional profile

September 18, 2024

by a professional from Miami University of Ohio in Denver, CO, USA

I'm interested in how searchers have financed their second deal while still holding onto their first financed SBA acquisition.

If for example you borrowed $2m SBA debt were you able to go back to the well for an additional $3m, up to $5m limit? Are you using traditional bank debt, private party debt... Going this route is probably the first steps into the HoldCo model, I'd welcome resources on how others have made this work.

Thanks for your thoughts.

4
11
139
Replies
11
commentor profile
Reply by a searcher
from University of Utah in Salt Lake City, UT, USA
You can now get as many SBA loans up to $5m as you want as long as each business is a different NAICS (different industry). If it’s the same industry then up to $5m so you could go buy a $3m company most banks have their own rules on “seasoning” of your current business first to make sure it’s cash flowing usually they want to see one year and a filed tax return then they will lend you another SBA loan. So the sky is the limit brother! Go get it!!!
commentor profile
Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA
You can definitely go back and get additional SBA financing for a second deal. Your existing lender may want a certain amount of time to pass before they do another deal with you, but you can always seek financing from another SBA lender. If you have or will exceed your $5 million SBA limit, then you can look at other conventional or non-bank financing options as well. I would be happy to discuss options at any time at redacted
commentor profile
+9 more replies.
Join the discussion