Buying an existing business is one of the fastest ways to grow, but it almost always takes outside money to close. The good news is that acquisition financing is a well-worn path, and funders care less about your personal balance sheet than about the business you are buying. Below is how the main options compare, what underwriters actually weigh, and how a business loan broker matches you to the funders whose guidelines you meet.
The SBA 7(a) loan is the classic acquisition tool
When the goal is to buy a business or acquire a competitor, the SBA 7(a) loan is the option most owners reach for first, and for good reason. It is built for exactly this purpose: it offers the longest repayment terms and the lowest long-term cost of any mainstream acquisition product, which keeps the monthly payment manageable while the business you bought pays the loan back out of its own cash flow.
The tradeoff is time and paperwork. SBA financing asks for the most documentation and the longest underwriting timeline, so it rewards owners who can plan ahead and wait a few weeks rather than days. If a clean, profitable target and a patient timeline describe your deal, start with our SBA loans guide to see what the process looks like.
When speed matters, a term loan can fund faster
Not every acquisition can wait on a full SBA file. If a seller wants to close quickly, or you are competing against other buyers, a business term loan can move much faster. You get a lump sum and a fixed repayment schedule, and the funds can close in a fraction of the time an SBA loan takes.
The tradeoff is the mirror image of the SBA loan: faster money is priced higher and carries a shorter term, so the payment is larger. Many owners use a term loan to win a time-sensitive deal, then refinance into cheaper long-term financing later once the acquisition is settled and the numbers are proven.
Seller financing can fill the gap
You rarely have to fund the entire purchase price from one source. Seller financing, where the seller agrees to be paid part of the price over time, is common in acquisitions and pairs naturally with an SBA loan or a term loan. It shrinks the amount you need to borrow up front and signals that the seller believes in the business they are handing over.
Stacking sources this way, a primary loan plus a seller note plus your own contribution, is often how realistic deals get done. A broker can help you structure the pieces so the combined payment still fits the target's cash flow rather than choking it.
What funders weigh most: the target's numbers
Here is the part that surprises first-time buyers. In an acquisition, funders focus heavily on the financials and cash flow of the business you are buying, not just on you. They want to see that the target consistently generates enough cash to cover the new loan payment with room to spare. Clean books, steady revenue, and verifiable profit on the target's side do more to get a deal approved than almost anything on your personal side.
That means the documents you gather are mostly the seller's: tax returns, profit-and-loss statements, and bank records for the business being sold. The cleaner and more complete that picture is, the more options open up, which is exactly where a broker earns its keep, by matching your specific deal to the funders whose guidelines you meet instead of you applying blind to one bank at a time. When your target is picked out, you can see what you qualify for in about two minutes, and checking your options won't affect your credit score.
See what you qualify for
One 2-minute application is matched to the funders whose guidelines you meet. It's free, and checking your options won't affect your credit score.
See What I Qualify For →The bottom line: Buying a business is fundable, the SBA 7(a) loan is the long-term workhorse, a term loan wins on speed, and the target's cash flow is what funders weigh most, so apply once and let a broker match you to the funders whose guidelines you meet.