What changed for SBA acquisition loans on October 1, and what it means for your files
SOP 50 10 8.1 applies to 7(a) loans that receive an SBA loan number on or after October 1, 2026. For acquisitions, it changes what gets a deal approved. Here is what matters for a broker preparing a file.
1. Coverage is measured on history, not projections
For an initial acquisition, debt service coverage must reach 1.25x, up from 1.15x, using historical or adjusted historical earnings from the last fiscal year or a two-year average. Projections can no longer be used to meet the requirement. Business expansions are tested at 1.15x.
For your files: the add-back recast now decides the deal. Every add-back needs a document behind it, and a market salary for the buyer should be deducted before you calculate coverage.
2. The lender checks the earnings independently
Lenders must obtain an independent business valuation on change-of-ownership loans. For initial acquisitions and business expansions with a business purchase price of $3 million or more, the lender must also order a quality of earnings report from an independent professional, and use the earnings it supports in the coverage calculation. Either can reduce the loan amount after a letter of intent is signed.
For your files: a seller's add-back schedule will be tested by someone working for the lender. Strip out anything you cannot support before submission, rather than finding out in underwriting.
3. No small-loan shortcut for acquisitions
The streamlined 7(a) Small loan process is no longer available for change-of-ownership transactions of any size. A $200,000 acquisition now receives full Standard 7(a) underwriting.
4. Tighter rules on where the equity comes from
The 10% equity injection still applies to complete changes of ownership. Limited sources, which now include standby seller debt and equity from non-controlling minority investors, together may fund no more than half of the required injection. A seller note only counts if it is on full standby for the life of the SBA loan.
For your files: confirm early that the buyer has at least half the injection in unborrowed cash, and look at what liquidity remains after closing.
5. Shorter amortization on real-estate-heavy deals
The business portion of an acquisition loan is capped at a 10-year amortization. The previous structure that stretched the whole loan to 25 years when real estate made up most of the project has been removed, which raises annual debt service on those deals.
A pre-submission checklist
- Identify the transaction category and its coverage floor.
- Recast the last fiscal year and the two-year average, with support for each add-back.
- Deduct a market salary for the buyer and adjust for costs that change at closing.
- Confirm the injection sources against the 50% limit on limited sources.
- Check whether a quality of earnings report will be required, and budget time for it.
- Stress the result: how far can revenue fall before coverage drops below the floor?
This note summarizes published analyses of SOP 50 10 8.1 and is not legal advice. Confirm details with the lender and the current SOP. If you have a deal you'd like checked against these rules, send it for a free screening.
Sources: U.S. Small Business Administration, SOP 50 10 8.1; Starfield & Smith, "Best Practices: Change of Ownership Transactions Under SOP 50 10 8.1" (Sept. 2026); FunderIntel, "SOP 50 10 8.1 Is Live" (2026); CLA, "The SBA Now Requires a Quality of Earnings on Larger Acquisition Loans" (Aug. 2026); FRANdata, "SOP 50 10 8.1 Franchise Lending Changes"; Pacific Business Sales, "New SBA 7(a) Loan Rules 2026".