Start with the acquisition uses and the buyer's intended operating role. A product label does not establish approval, cash availability or the best structure. This guide compares questions to ask about each source; use the term and funding tool for the arithmetic.
Match each source to a documented use
| Potential source | Question for the written proposal |
|---|---|
| SBA 7(a) | Which ownership, working-capital, equipment or property uses qualify for this borrower and structure? |
| SBA 504 | Which eligible fixed-asset uses fit, and which operating/goodwill/working-capital uses need another source? |
| Conventional business debt | What earnings definition, collateral, guarantees and conditions apply? |
| Property financing | What property, occupancy, valuation, environmental and maturity requirements apply? |
| Equipment loan or lease | What equipment, installation and other costs are covered; who owns the asset and what is due at termination? |
| Seller note | What payment, standby, priority and enforcement terms can all parties accept? |
| Equity partner | What control, distributions, funding commitments, repayment restrictions and exit terms are documented? |
Use the current program descriptions for 7(a) and 504 rather than assigning a universal product to every business purchase. US Small Business Administration: 7(a) loans; US Small Business Administration: 504 loans. A program maximum or eligible-use list is not a commitment for this transaction.
Compare the same evidence, not a promotional headline
Request principal, gross/net disbursement, eligible uses, buyer cash, fees, interest basis, amortization, maturity, prepayment, collateral, guarantees and conditions. Identify any other loan, lease or seller obligation competing for cash. A low monthly payment may leave a balloon or omit costs.
Keep fixed and variable-rate proposals distinct. Record an index, spread, floor, reset and payment mechanism when applicable. The website comparison uses fixed nominal rates with monthly payments; an increased-rate case is a sensitivity from the outset, not a forecast or an actual reset schedule.
Count commitments and buyer cash honestly
Make a complete sources-and-uses schedule including fees, immediate projects and opening operating cash. Count a seller note once as consideration offset. Separate a paid credited deposit from additional cash available. Proposed funds and a preliminary lender conversation do not fund the closing.
Equity partners require clear governance, distributions, reporting and exit arrangements reviewed with counsel. A promised return or obligation to repay capital can affect its treatment. Ask the senior lender how every proposed source fits its conditions and current rules. US Small Business Administration: SOP 50 10 version register.
Prepare and track the review
Organize borrower information, financial statements, tax records, POS/billing evidence, purchase documents, lease/property records, equipment and relevant approvals as requested. Use the controlled data-room method for authorized sharing. Do not upload private records into public scenario tools.
Ask the lender for transaction-specific experience, credit and due-diligence requirements and a dated conditions list. There is no universal score cutoff, approval timetable or no-money-down result supplied here. Track the owner, evidence reference and next action for every condition.
Connect the selected structure to operations
Use matched-period earnings, replacement labor, equipment costs and the monthly cash plan to test the operating assumptions. Compare total payments and maturity principal with the intended cash sources. The annual ROI tool has narrower fully amortizing limits; preserve those distinctions.
Review seller-note risk and insurance evidence before closing coordination. Neither the comparison nor a lender introduction is an approval or permission to wire funds.
Sources and scope
Official and original sources checked October 17, 2026. These sources support the identified rules and methods; they do not verify a particular business or property.
- US Small Business Administration — 7(a) loansProgram purpose, maximum, eligibility overview and lender application; not a loan offer.
- US Small Business Administration — 504 loansEligible fixed-asset program purposes and restrictions; not blanket business acquisition or working-capital financing.
- US Small Business Administration — SOP 50 10 version registerCurrent version register; detailed transaction rules must be checked with the lender.
Continue your review
Verify the revenue · Normalize earnings · Model the cash flow