Major SOP 50 10 8 SBA Changes (Effective June 1, 2025) — What They Mean for Business Buyers

If you’re looking to buy a business using SBA financing, or you advise clients who do, the new SBA SOP 50 10 8 update—effective June 1, 2025—represents one of the most important regulatory shifts in recent memory.

Whether you’re a first-time buyer, a search fund operator, or a lender trying to stay ahead, here’s what you need to know about the changes—and why they matter for real-world dealmaking.

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Let’s break it down:

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1. No More “Too Rich to Borrow”: The End of the Rigid Personal Resource Test

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In the past, SBA rules could disqualify borrowers from accessing SBA loans based on their liquidity or personal net worth, even if they had no intention of using those resources in the business. This discouraged many would-be acquirers, particularly those with successful spouses, rental income, or other non-operating assets.

What’s Changing:

• The SBA has removed strict personal liquidity thresholds.
• Instead, lenders are now encouraged to use global cash flow analysis, meaning they can count spousal income, rental properties, affiliate income, or other outside earnings as a strength—not a disqualifier.
• Importantly, borrowers are not required to use their personal resources for the business. The focus is on repayment ability, not penalizing wealth.

Why This Matters:

This opens the door for high-earning W-2 professionals, successful dual-income households, and passive investors to access SBA funding—without being forced to drain personal savings. It also gives lenders more discretion to approve deals that are otherwise strong but didn’t fit past liquidity cutoffs.

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2. Seller Notes Can Now Count Toward Equity Injection (With Limitations)

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Previously, a seller note could not be used as part of the buyer’s 10% equity injection unless it was paired with cash. Now, that changes—but only under specific terms.

What’s Changing:

A seller note may count toward the 10% equity injection requirement if:

• It is on full standby for the life of the loan—meaning no principal or interest payments for the entire term.
• It represents no more than 50% of the total equity injection.
• It is properly documented using SBA Form 155 or an equivalent.

Why This Matters:

This is a game-changer for deal structuring. Buyers who are short on cash but have a willing seller can now close deals with less upfront capital. It also incentivizes sellers to stay invested in the success of the business by deferring their compensation.

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3. New Requirements for Rollover Equity and Seller Retention

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Many acquisitions involve rollover equity, where a seller keeps a minority stake or a buyer purchases only part of the company. These structures just got new guardrails.

What’s Changing:

• All new owners, no matter their percentage of ownership, must be listed as co-borrowers on the SBA loan.
• Any seller who retains less than 20% ownership must personally guarantee the full loan for at least 2 years.

Why This Matters:

This closes a loophole where sellers could “stay in the deal” but avoid liability. It ensures all parties have skin in the game, especially in transitional deals or partial buy-ins. For buyers, it’s a heads-up to plan legal structures and negotiation strategies carefully, especially in family transitions or management buy-ins.

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4. Stock Purchase Required for Partial Buy-ins

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Structuring a partial buy-in as an asset purchase? As of June 1, that’s off the table if you want SBA financing.

What’s Changing:

• Any partial acquisition involving rollover equity must be structured as a stock deal.
• Asset purchases are no longer eligible for SBA financing in these scenarios.

Why This Matters:

This is a big shift for deal structuring. Asset deals are often preferred for tax or liability reasons, but in partial buy-ins, the SBA wants to ensure continuity of ownership and obligations. If you're planning a multi-phase acquisition or bringing in a partner, work with your attorney to structure accordingly.

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5. CPA-Prepared Financials Can Replace Tax Returns

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One of the biggest hangups in SBA underwriting is the reliance on tax returns, which may not always reflect a business’s true performance—especially in cases of sole proprietorships, carveouts, or newly segmented entities.

What’s Changing:

• SBA lenders may now accept CPA-prepared or CPA-reviewed financial statements when tax returns are:
  • Incomplete
  • Unavailable
  • Not reflective of actual operations

Why This Matters:

This is particularly helpful for:

• Sole proprietorships transitioning to formal entities
• Divisions being carved out from a parent company
• Recently formed entities acquiring legacy assets

It gives lenders and borrowers more flexibility and accelerates underwriting—especially in complex or fast-moving deals.

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Final Thoughts: What This Means for Buyers and Advisors

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These changes make SBA acquisition loans more flexible, more inclusive, and better aligned with modern deal structures.

For searchers, fund managers, brokers, and strategic acquirers, this opens up new pathways to close deals that previously got stuck on technicalities. It rewards clean structuring, good underwriting, and real repayment ability—not just personal financial optics.

As always, the devil is in the documentation—so make sure your advisory team (attorneys, lenders, and accountants) are up to speed.

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Want help navigating the SBA process?

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We’ve helped hundreds of buyers structure SBA deals with creative, compliant strategies that get approved.
Our platform at ClearlyAcquired.com helps you:

• Match with lenders in real time
• Evaluate deals using verified data and lender requirements
• Organize your pipeline, documents, and financing options in one place

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Whether you’re just starting your acquisition journey or you’ve got an LOI in hand, we’re here to help you close faster and smarter.

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