Glossary · Doing the deal
Owner Buyout
In short
The purchase of one owner's share of a business by another existing owner. The SBA 7(a) program supports these buyouts under specific conditions.
What it means in a deal
For an owner buyout to be eligible for 7(a) financing, the selling owner must fully exit the business, and the buying owner must maintain or gain controlling interest. The loan proceeds are used to pay the seller for their equity. Ensure the transaction meets SBA "change of ownership" requirements.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
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 Owner Buyout
- Can cash-out loan proceeds go to the remaining owner in a buyout?
- Does the remaining owner have to personally guarantee the SBA loan after a buyout?
- How does a partner buyout impact the personal guarantee requirements for the remaining owner?
- How does the SBA handle a partner buyout where the remaining owner's experience is limited?
- How does a partner buyout with an SBA 7(a) loan impact the remaining owner's personal guaranty?
- Can an SBA 7(a) loan finance a partner buyout?
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.
Line up financing while you're under LOI
Tell us the business, the price, and your timeline — we'll match you with lenders who close deals like yours and flag anything that stalls the process.
Free · No documents · Usually same-day
Backed by data on 1,000+ SBA lenders and 300,000+ funded deals. Your details go only to lending partners you ask to be matched with — never sold to advertisers.