Methodology: deal
Deal and Listing Financeability Methodology for SBA Acquisitions
Deal financeability asks whether the target's supportable historical cash flow and transaction facts can carry the proposed capital stack. A profitable company can still be unfinanceable at the asking price, with the proposed working capital, or for the proposed buyer.
Transparent methodologyPolicy as of 2026-08-15Preliminary, not a loan approval
Deal inputs
Deal inputs
- Three years of business tax returns where available.
- Current interim profit-and-loss statement and balance sheet.
- Reconciliation of reported earnings, SDE or EBITDA, and defensible add-backs.
- Purchase price, allocation, working capital, closing costs, and total project cost.
- Debt schedule, leases, contingent liabilities, and required capital expenditures.
- Seller-note amount, equity treatment, standby, subordination, and payment terms.
- Customer concentration, recurring revenue, industry, occupancy, and transition risks.
Cash-flow model
Cash-flow model
Modeled DSCR equals eligible annual cash flow divided by total annual debt service included by the lender. Emporio displays the rate, term, loan amount, seller-debt treatment, and planning DSCR used. A 1.25x planning assumption is a screen, not a universal SBA approval threshold.
Listing-level conclusion
Listing-level conclusion
A listing can be described as likely financeable only at a stated price range and assumptions. It must never be marketed as SBA approved. Buyer approval remains separate.
Authored and reviewed by Emporio Partners
Policy basis: SBA SOP 50 10 version 8, effective 2025-06-01. Version 8.1 is published for 2026-10-01 and is not treated as current policy before that date.
Primary policy source
Educational planning guidance only. Emporio Partners is not a lender and does not issue approvals, pre-approvals, commitments, or guarantees. Lenders determine eligibility, eligible cash flow, structure, terms, and approval.
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