SBA pre-qualification (Live Oak, Pursuit, Huntington, Newtek)

What it is

Getting a specific SBA 7(a) lender to actually review your financials, credit, and the deal's terms before you're deep into a purchase agreement — so financing is a known quantity going into negotiations, not an assumption you're hoping holds up. Lenders differ meaningfully: some specialize by dollar volume in specific industry verticals, others do the highest deal count with a strong regional presence, some run nationwide online platforms, and others are mission-driven community development lenders with programs for women-, minority-, and veteran-owned businesses — the right fit depends on your deal's size, industry, and geography as much as on rate.

Every SBA 7(a) change-of-ownership loan requires a minimum 10% equity injection from the borrower side. That injection doesn't have to be 100% cash — a seller note can count toward it under specific conditions covered in the seller financing guide — but every lender will confirm your liquidity and injection plan before they'll issue real terms, not just a rate sheet.

Why it matters

Deals fall apart in financing far more often than they fall apart in negotiation. A buyer who makes an offer before talking to a lender is effectively negotiating price and terms against an unknown — the deal might not be financeable as structured at all, and you won't find out until you've already spent weeks or months building a relationship with the seller.

What to look for

• No lender conversation started before making an offer
• Lender feedback that conflicts with the deal's assumed price, multiple, or structure
• Uncertainty about your own liquidity or how you'll cover the required equity injection
• Whether the lender you're talking to actually finances this specific industry and deal structure — not every SBA lender does