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SBA 7(a) + DSCR Calculator
Will this business acquisition cash-flow under an SBA loan?
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Educational use only — not financial advice. This calculator is for illustrative purposes only. SBA loan terms, rates, and approval criteria vary by lender and deal. Consult a licensed SBA lender, business broker, or financial advisor before making any acquisition decision.
Monthly Debt Service
$6,199
Principal + interest
Annual Debt Service
$74,385
Total / year
Owner Take-Home
$105,615
SDE minus debt service
Down Payment
$50,000
10% of purchase price
Loan Amount
$450,000
Rate
11%
Term
10 yrs
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How the Math Works
Debt Service
Monthly payment is calculated using standard amortization: P × r(1+r)ⁿ / ((1+r)ⁿ − 1), where P = loan principal, r = monthly rate, n = total months. Multiply by 12 for annual.
DSCR
Debt Service Coverage Ratio = Annual SDE ÷ Annual Debt Service. SBA 7(a) lenders typically require a DSCR of 1.25× or higher. A DSCR of 1.0 means break-even.
SDE vs. EBITDA
Seller's Discretionary Earnings adds back the owner's salary and one-time expenses. EBITDA is more commonly used for larger deals ($2M+). Both proxy for pre-debt cash flow.
SBA 7(a) Basics
The SBA 7(a) program is the most common acquisition loan. Down payments are typically 10–20%. Max loan is $5M. Term for business acquisitions is usually 10 years; real estate can extend to 25.
EDUCATIONAL USE ONLY — NOT FINANCIAL, LEGAL, OR INVESTMENT ADVICE. This tool is provided for informational and illustrative purposes only. Outputs do not constitute a loan offer, approval guarantee, or investment recommendation. Actual SBA loan terms, eligibility, and approval depend on lender underwriting, collateral, credit history, business type, and other factors. Consult a licensed SBA lender, CPA, attorney, or financial advisor before making any acquisition decision. DealQuest is not a registered broker-dealer or investment advisor.