Post Close Liquidity

searcher profile

January 03, 2025

by a searcher in Sacramento, CA, USA

Do I need to provide my own liquidity for post close (security deposit for lease, making payroll, etc.)? Are you able to acquire working capital in the SBA loan? I had a broker tell me I need to provide 20% of purchase price proof of funds because I will need 10% for post close liquidity.

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commentor profile
Reply by an intermediary
from Wake Forest University in Winston-Salem, NC, USA
You can absolutely borrow working capital in an SBA loan. Likely what they are referring to is what lenders call post-closing reserves. Depending on the loan type, and a lot of buyer and loan specifics, lenders like to see that the borrower has post-closing liquidity to cover unforeseen hiccups or expenses (in the business or in their personal life). The amount can vary, but 6-9 months of Principal and Interest seems to be a common range, which roughly translates to 10% of the purchase price.
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Reply by a lender
from Eastern Illinois University in 900 E Diehl Rd, Naperville, IL 60563, USA
Yes, you can acquire working capital in an SBA loan. You can build it directly in the loan, use a separate line of credit, or do a combination of both. Happy to talk strategies with you at any time. You can reach me here or directly at redacted
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