Have a few questions related to SBA loans that I don't think I've seen answered directly before (apologies for length - TLDR at bottom):

1. A few have mentioned in passing to "get your personal mortgage debt in order" (ie. draw on HELOC) before taking on SBA debt for an acquisition. I understand the requirement to pledge your home as collateral if >20% ownership and the importance of W2 income on mortgage underwriting.

My question is: As a searcher that rents currently with a spouse with strong w2 income, we have been debating buying a property while I search, funded with <20% down (essentially under my spouse's name/credit). The market is such that we would save on rental expense and could flip to an investment property if / when we would need to relocate for an acquisition. Would this impact my ability to receive SBA funds down the road (assume down payment / liquidity not an issue)? If we wait to purchase until after acquisition, would our ability to receive a mortgage be negatively impacted by the SBA debt (again, assuming spouse's strong W2, not a direct owner in the biz, no PG for spouse)?

2. While not modeled in my base case, part of my thesis for upside is growth via acquisition. I'd likely want to take >6-9 months to get processes in place but some of my outreach is yielding potential bolt-ons sooner. I understand SBA lenders don't typically want to upsize for acquisition until 9-12 months post acquisition due to requirement of financial / operating history as a new owner.

Are there any actions that could be taken as part of your initial SBA loan application / cap structure alternatives to provide for potential funding for smaller acquisitions if a time sensitive opp arises early (ie contribute more equity, bigger LOC, fund excess NWC, fund acquisition with mezz, etc.)? Seems like its more of a constraint on financial history than leverage but curious if those with roll up plans have considered this under SBA constraints.

3. The lease requirement of 5 year with 5 year option: Is that specific to existing business location. Could you have another lease prepared at a different location with a different landlord, relocate the business and still receive SBA funding? Alternatively, could you have another property under contract to purchase, utilize the more favorable SBA amort schedule and relocate the business (assume the math pencils)? What are the constraints / requirements on relocating a business at acquisition with SBA funds?


1. Should I take out a high LTV mortgage before I buy a business with SBA debt?
2. What is best way to structure a deal with SBA debt if you want to do add-ons early?
3. Can you relocate a business at acquisition with SBA? If so, what are the requirements? Can you purchase a different piece of RE to relocate the business funded in part by SBA debt at acquisition?