Glossary · Reading the business
Cash flow after debt service
In short
What's left for you each year after loan payments. The first number to check on any listing.
What it means in a deal
Cash flow after debt service is the buyer's real return on the deal — it's what you take home after the loan payment clears. On a business with $200K SDE and a $120K annual loan payment, you're left with $80K before taxes. That's your number to live on and build from. Run this calculation before you fall in love with any listing, and remember to factor in a market-rate salary if SDE already includes your compensation.
Related terms
Common questions about Cash flow after debt service
- What are the consequences if the borrower's debt service coverage ratio (DSCR) falls below the lender's minimum after closing?
- Does the SBA require a specific debt service coverage ratio (DSCR) for approval?
- Can future cash flow or profits from the acquired business count as equity injection?
- When is a debt service coverage ratio waiver or exception possible for an acquisition?
- How can an SBA 7(a) loan help with ongoing cash flow for my business?
- How does a seller note on full standby affect the debt service coverage ratio calculation?
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 2026-06-16 · 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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