The SBA Just Doubled What You Can Borrow to Buy a Business

A major rule change is about to make acquisitions easier to finance than they've been in years. The U.S. Small Business Administration just announced one of the most significant expansions to its lending programs in agency history. Effective July 4, 2026, eligible borrowers can now combine an SBA 7(a) loan and a 504 loan for up to $10 million in total SBA-backed financing — double the previous $5 million cumulative cap. For buyers, this is a game-changer. The SBA 7(a) program has long been the backbone of small-business acquisitions because it offers longer repayment terms, lower down payments, and more flexibility than most conventional commercial loans. Now there is significantly more capital available to put those advantages to work. Why This Matters for Buyers The 7(a) program is the SBA's flagship tool, used to finance equipment, real estate, working capital, and — most relevant here — business acquisitions. With the new structure, a qualified borrower who secures a 7(a) loan first can access up to $5 million through 7(a) and up to $5 million through the 504 program. That decoupling gives capital-intensive buyers far more room to pair long-term real estate and equipment financing with the working capital needed to actually run and grow the business after closing. The Acquisition Basics You Should Know: 1) 10% equity injection. For a complete change of ownership, buyers must put in at least 10% of total project cost (purchase price plus closing costs). 2) 100% ownership transfer. Standard 7(a) acquisition loans require a full change of ownership — partner buyouts are a structured exception. 3) Relevant experience. You do not need to have run the exact business, but you do need to demonstrate transferable operational or management experience. 4) Terms. Up to 10 years for a business acquisition, extending to 25 years when real estate is included.