Glossary · Your money in the deal
Seller-Financed Portion
In short
This is a portion of the purchase price the seller agrees to lend to the buyer, paid back over time. It's often required by the SBA to show the seller's continued interest in the business's success.
What it means in a deal
The SBA typically requires the seller to finance at least 5% of the total project costs, usually on "full standby" for the life of the SBA loan. This means the seller cannot be paid principal or interest until the SBA loan is repaid. This seller note often counts towards your equity injection.
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 Seller-Financed Portion
- Can a seller-financed portion of an acquisition count as my down payment?
- Can a seller-financed portion of the sale be considered part of my equity injection?
- What percentage of a $1 million business acquisition can be financed by an SBA 7(a) loan if a significant portion is goodwill?
- Are there specific maximums for the percentage of a business acquisition that can be seller-financed on full standby?
- What if the seller holds a significant portion of the acquired business's debt?
- What happens if the seller requires a "holdback" of a portion of the purchase price after closing?
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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