Your SBA lender will approve your loan based largely on what the seller earned. Then you’ll run the business on what’s left over after you pay the bank, and under the new rules, that can be as little as 20 cents of every dollar the business earns. That’s the money you’ll use to pay yourself more, hire someone, replace equipment, or make the changes you bought the business to make.
This new rule and several others outlined in SOP 50 10 8.1 take effect October 1, 2026. Your SBA lender will walk you through how they affect your deal. What gets less attention is how they affect you after closing, once you’re the one running the business.
The decisions made at closing don’t stay at the closing table. You’ll live with them for years while you pay off the loan. I work with people making the move from buyer to owner, and after 20 years in business operations, that’s the lens I bring to these changes. Below are three of the updates and how they’ll show up once you own the business: how your loan gets sized, how you’ll cover cash flow, and how long the seller can stay.
A few notes before we start. The examples here are illustrations, not real clients, meant to make some complicated ideas more concrete. I’m not a lender, accountant, or attorney, so if any of this applies to your deal, talk it through with yours. Also, SOP 50 10 8.1 covers how a loan gets set up. A separate SBA rulebook covers changes to the loan once it’s in place. Everything here is about decisions made at closing that impact how you operate.
1. Debt service coverage: Your loan is based on the seller’s past earnings, so there’s little cash left to hire, buy equipment, or add services
Before an SBA lender approves an acquisition loan, they check one thing above almost everything else: can the business, as it runs today, afford the loan payment with room to spare?
Under the new rules, “room to spare” means the business has to have earned $1.25 for every $1.00 of loan payments. And the lender has to show that using what the business already earned, either last year or the average of the last two years. Your lender still has to review your projections, but they can’t rely on them to approve the loan.
How this could show up for new owners. Say a landscaping company brought in $250,000 last year after paying its bills and its people, before any loan payments. At $1.25 for every $1.00, the most it can carry is $200,000 a year in debt payments. The remaining $50,000 is your cushion.
That $50,000 sounds like plenty until you own the business. It’s the money for the mower that dies in June, the slow month when two big clients pay late, the crew member you want to hire, and the new service you bought the business planning to add. The plans you had when you bought it aren’t in the loan. They get paid for out of that cushion, or they wait.
A loan that gets approved isn’t the same as a business with room to breathe. Your lender’s job is to decide whether the business can carry the loan. Your job is to decide whether what’s left is enough to run it the way you want.
Your salary is part of the same math. When lenders run these numbers, they decide what salary to assume for the new owner. Say the seller paid themselves $190,000 a year. If the deal only works with you taking $95,000, the lender can plug in $95,000, as long as they can show you can cover your personal bills and living expenses on it.
That $95,000 is already built into the landscaping example. The $250,000 the business earns is what’s left after paying you $95,000, and the loan was sized from there.
Nothing stops you from paying yourself more after closing. But the loan payment doesn’t change, so any raise comes straight out of your cushion. Pay yourself $135,000 instead, and your $50,000 cushion drops to $10,000. That $10,000 is all you’d have left for the broken mower, the late-paying client, and the hire you were planning.
So unless the business starts earning more than it did for the seller, that salary number is likely to become your household budget for a while.
The good news: the loan payment stays the same no matter how much more the business earns. Every dollar you add, by tightening up operations, pricing better, or keeping customers longer, goes straight into your cushion. That’s where your raise or new team member comes from.
What this means once you own it: Ask your lender to walk you through the numbers they used: what the business earned, the annual loan payment, and the salary they assumed for you. Put them on one page. That’s your starting line. It shows how much room you have today, and how much more the business needs to earn before you can pay yourself more or take on something new.
2. Line of credit: If you don’t set one up at closing, you could end up short on cash while you wait for customers to pay
Working capital is the cash that keeps the lights on between doing the work and getting paid for it. If your customers pay in 60 days and your people get paid every week, you need something to bridge that gap. For many small businesses, that’s a line of credit.
Here’s the complication. Under the new rules, your SBA lender has to take a claim, called a lien, on two things: your accounts receivable (the money customers owe you) and your inventory. Those are the same assets a line-of-credit lender usually wants first claim on.
The new SOP spells out how to handle this. A line of credit can be set up alongside your acquisition loan with first claim on those assets, but it has to be part of the deal. There’s a catch. If your line of credit gets first claim on those assets, your SBA loan loses some of its backing. To make up for it, part of the purchase price has to go on the line of credit instead of the SBA loan. That means between 20% and 50% of your line is already used on day one. (A line that takes second claim works differently, so ask your lender which one you’re getting.)
Here’s how that could show up. Lamar buys a commercial cleaning company. His clients pay in 60 days, and payroll runs every week. Three months in, $140,000 is sitting in receivables and his bank account is thin. He calls his lender about a line of credit and learns his SBA loan already has a claim on those receivables. It was set at closing, and he never thought to ask.
Another owner did set up a $100,000 line at closing. What they didn’t register was that $30,000 of it was drawn on day one and went toward the purchase. They’d been planning around $100,000 of breathing room. They actually had $70,000.
What this means once you own it: If you have a line, know two numbers: what’s available today and what was already drawn at closing. If you don’t have one, don’t wait for a cash crunch to find out where you stand. Have the conversation with your lender early, while things are calm. How a lender handles changes to your collateral after closing depends on your lender and falls under that other rulebook, so ask before you need the answer.
3. Seller consulting: The seller can now stay for up to two years, which gives you time to learn the business but also time to get stuck running it their way
When you buy an entire business, the seller has to step away. They can’t stay on as an owner, officer, or employee. But you can hire them as a consultant to help you learn the business, and the new rules double that window from up to 12 months to up to 24.
That extra time is a real gift for new owners, with two limits. First, 24 months is the most you get, including any extensions, so there’s no third year. Second, the seller is there to advise. Running the place is your job.
(This applies when you’re buying the whole business. If the seller is only selling part of their stake, different rules apply and they can stay on in other roles.)
There’s also a catch the rules don’t mention. Two years is long enough to lean on the seller for every hard call, and long enough for your team to keep going to them instead of you. It’s also long enough to settle into doing things their way without asking whether their way still works.
Here’s how that could show up. Say Maria buys a print shop, and the seller stays on as a consultant for the full two years. In the first year, the seller introduces Maria to the big clients and shows her how jobs get priced. But whenever something goes wrong, the staff still calls the seller, and Maria lets it happen because it’s easier. When the two years are up, the seller leaves. Maria knows the clients, but her staff has never had to come to her for answers. And the shop still runs exactly the way the seller ran it: the same paper order forms, the same pricing, the same way of doing everything. That’s two years she could have spent bringing the business up to date.
What this means once you own it: If seller consulting is part of the deal, agree on what gets handed over, not just how long the seller stays. Then treat the consulting period like a project with an end date, because it has one. List what lives only in the seller’s head: key customer relationships, vendor terms, how they price jobs, the quirks of the equipment. Plan the months to get all of it written down, so it stays with the business after the seller leaves. And as you learn why things are done a certain way, decide whether they should keep being done that way. The seller knows the history. You decide what comes next.
What you decide at closing, you live with as owner
Most of what shapes your first year gets decided before you get the keys. Your cushion, your paycheck, your cash flow, and your time with the seller are all set at the closing table. None of that is a reason not to buy. It’s a reason to go in with your eyes open. The conversations you have with your lender and the seller before closing aren’t just about getting the deal done. They’re about the business you’ll be running afterward. The more clearly you understand what each decision means for you as the owner, the better prepared you’ll be to adjust when those decisions show up in your day-to-day. You’ll know what’s already set, where you still have room, and how to make the business yours.
In Part 2, we’ll look at three more areas to understand while you’re finalizing your SBA loan: how the money your investors put in gets tied up, what the Quality of Earnings report means for your first year as owner, and when you can buy your next business. The better you understand them now, the smoother your move from buyer to owner.
Quick answers: running a business you bought with an SBA loan
How do I prepare to run a business I’m buying with an SBA loan?
Before closing, ask your lender to walk you through the numbers they used to approve the loan: what the business earned, your annual payment, and the salary they assumed for you. Those numbers set your budget for the first year, so know them before you get the keys.
How much should I pay myself after buying a business?
Start by knowing the salary your lender assumed and how much cash is left after your loan payment. That salary was part of the lender’s math, not a recommendation. Anything you pay yourself above it comes out of the cash the business needs for repairs, slow months, and new hires. The way to earn more is to raise what the business brings in, through better pricing, tighter operations, or keeping customers longer.
How do I make the most of the seller’s transition period?
Work backward from the day the seller leaves. Decide early what you need to be able to handle on your own by then, and give yourself more responsibility each month. Don’t fall into the trap of letting employees and customers go to the seller for everything. You own the business now.
What should I focus on in my first year of owning a business?
Know your numbers, get the business’s knowledge out of the seller’s head and onto paper, and find where the operations you inherited are costing you time or money. Small improvements there create the room to pay yourself more and invest in the business.
Want to keep going? I broke down three more changes in Part 2, including new rules around investor funding, Quality of Earnings reports, and buying your next business with SBA financing.
About Nikki Belt:
Nikki is the founder of Anchor & Keel. She works with people who bought a business in the last two years with a clear vision of what it could do for them and their families, but are buried under old ways of working, outdated systems, and a team they didn’t hire. Drawing on 20 years of operations experience at places like Google, Microsoft, and the Gates Foundation, she helps new owners stop surviving the business they bought and start building the life they bought it for.
If you bought a business and you’re buried in the day-to-day instead of building toward what you bought it for, let’s get on a call and talk through how you can go from buried to building.
