New SBA 7a Program Proposed Changes!

The SBA is proposing a major update to the eligible use of proceeds. The proposed change is to expand the use of proceeds for SBA loans to include loan proceeds for the purchase of a portion of a business. Previously, the SBA restricted loan proceeds to only funding the entire business or the entire stock of the entity.

This will allow existing owners to cash out without retiring, bring in management that might help grow the business, allow existing employees to acquire shares in the business and more. We expect this to be implemented in the near term.