Glossary · Reading the business
Business Projection
In short
This is a forecast of a business's future financial performance, including revenue, expenses, and profit. It's crucial for you and the lender to assess the business's future viability.
What it means in a deal
For an SBA loan, you'll need a solid business projection to show how the acquired business will generate enough cash flow to cover debt service and provide you with income. Lenders scrutinize these, so ensure yours are realistic and well-supported by market analysis.
Official sources
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Business Projection
- If the acquired business has a recent history of losses, but a strong projection under new ownership, can it still be approved?
- Are there specific criteria for my business plan and financial projections for an acquisition loan?
- What common indicators in a business's financial projections would signal a failure to meet prudent lending standards?
- Can a seller note be repaid early if the business significantly outperforms projections and the SBA loan is current?
- Do I need to create a formal business plan with detailed projections to apply for an SBA 7(a) loan?
- How does the SBA's 'prudent lending standards' apply to the evaluation of working capital projections for a new business acquisition?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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