Glossary · Reading the business
Projection(Financial projections)
In short
A forecast of a business's future financial performance, including revenue, expenses, and cash flow. Lenders heavily rely on these to assess the business's ability to repay your SBA loan.
What it means in a deal
For your SBA loan application, you'll need detailed projections, typically for 1-3 years, showing how the business will perform under your ownership. These must be realistic and supported by market analysis and historical performance. Your lender uses these to confirm your repayment capacity and calculate your DSCR.
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 Projection
- If the acquired business has a recent history of losses, but a strong projection under new ownership, can it still be approved?
- Can incomplete or inconsistent financial projections lead to an SBA 7(a) loan denial?
- Are there specific criteria for my business plan and financial projections for an acquisition loan?
- What constitutes a failure of 'prudent lending standards' regarding financial projections for a 7(a) loan?
- Are there any restrictions on the use of cash flow projections for an SBA 7(a) acquisition loan?
- How does a lender evaluate the reasonableness of a borrower's projections for future revenue and cash flow?
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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