Yes — but not with the products that fund a business you already own. Buying a business is financed against the target company’s cash flow and assets, not yours, and in the U.S. that usually means an SBA 7(a) loan combined with seller financing and a cash injection from you. Revenue-based products cannot do this job.
Why your usual funding options do not work for an acquisition
Merchant cash advances, revenue-based financing and short-term loans are all underwritten on your bank statements — the deposits your business has already made. If you are buying a business you do not own yet, there are no statements in your name to underwrite, and the business generating the revenue is not yet yours to pledge. That is the whole problem in one sentence.
This trips up a lot of first-time buyers, because the fast products are the ones they have seen advertised. An advance against future card sales cannot fund a purchase, because the sales it is priced against belong to the seller until closing. Even if a funder would advance against your existing business to buy a second one, you would be servicing a short repayment schedule out of a company you have owned for a week — which is exactly the structure that kills acquisitions in year one.
Acquisition funding runs on different logic — closer to how an SBA loan is underwritten than to how an advance is. The lender underwrites the target business: its historical cash flow, its assets, how transferable its customer base is, and whether the price you agreed can be serviced out of the profits after you take a salary. Your own credit, experience and cash contribution matter, but they are inputs to that question rather than the question itself.
What is the main way to finance buying a business?
The SBA 7(a) loan is the primary route for most U.S. small business acquisitions. The SBA lists “changes of ownership (complete or partial)” as an explicit eligible use of 7(a) proceeds, and the maximum 7(a) loan amount is $5 million. It is a government-guaranteed loan made by a bank or approved lender — not by the SBA itself — and it is why acquisitions are financed on ten-year terms rather than twelve-month ones.
The reason it dominates comes down to amortisation. A conventional bank loan for an acquisition, if you can get one, tends to want heavy collateral and a shorter term. A 7(a) can stretch the repayment over ten years for a going-concern purchase, which is what makes the monthly payment small enough to be covered by the business you just bought. That single structural difference — term length — is worth more to a buyer than the interest rate.
Most deals are not funded by one source, though. The common shape is a stack: an SBA-guaranteed loan for the largest slice, a seller note for a meaningful portion, and a cash injection from the buyer. Seller financing does double duty here — it fills a gap, and it keeps the person who knows the business financially interested in your first couple of years. Lenders read a seller who refuses to carry any paper as a signal worth asking about.
Be realistic about the parts of the deal that are not the purchase price. You will need working capital from day one, because the seller’s cash leaves with the seller, and you will pay for legal work, a business valuation and often an appraisal. Fold those into what you raise rather than discovering them at closing.
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 →What do lenders actually check on an acquisition deal?
Acquisition lenders underwrite four things: whether the target’s historical cash flow covers the new debt payment with room to spare, whether the price is supportable by an independent valuation, whether you can run this specific business, and how much of your own money you are putting in. Weakness in one can be offset; weakness in three ends the deal.
Cash flow coverage is the first gate. The lender recasts the seller’s profit — adding back one-off and owner-benefit expenses that will not continue — to work out what the business really earns, then tests whether that figure services the proposed debt after paying you a reasonable salary. If it only just clears, expect the lender to ask for a bigger down payment or a larger seller note rather than to decline outright.
Nearly every acquisition lender will also want a personal guarantee from you. Your experience is weighted more heavily than buyers expect. Relevant management or industry background is genuinely underwritten, because a lender is financing a ten-year obligation on the assumption that the business keeps performing after the person who built it leaves. Where that experience is thin, a longer seller transition period and a strong second-tier management team already in place will do a lot of the work.
Finally, customer concentration and transferability get read closely. A business where the top client is 40% of revenue, or where the relationships plainly belong to the departing owner personally, is a harder deal to fund than one with a spread of repeat customers and contracts that survive a change of ownership. This is worth knowing before you agree a price, not after.
What to have ready before you approach a lender
Have three years of the target’s tax returns and financial statements, a current year-to-date profit and loss, a signed letter of intent or purchase agreement, your own personal financial statement and resume, and a written plan for the first year of ownership. Missing pieces here are the most common reason an acquisition file stalls.
Two of those deserve emphasis. Get the seller’s numbers in a form a third party can verify — filed tax returns rather than a bookkeeping export — because a lender will reconcile them and any gap between the two versions costs you weeks. And write the transition plan properly: how long the seller stays, who holds the key customer relationships, what you will change and, more persuasively, what you will not.
Expect the process to take longer than any other kind of business funding. Buying a business is measured in months, not days, because valuation, due diligence and legal work sit on the critical path alongside the credit decision. Start the funding conversation while you are negotiating rather than after you have signed, so the deal you agree is one that can actually be financed.
One honest caveat on the numbers: buying a business is not a guaranteed path to a stable one. In the Federal Reserve Banks’ 2026 Report on Employer Firms, 46% of firms that sought financing did so to pursue an expansion or new opportunity — acquisitions sit squarely in that group — while 42% of applicants received the full amount they sought, 36% received some or most, and 22% received none. Partial approval is a likely outcome, so decide in advance what you would do with less than you asked for.
Where a broker fits — and where one does not
The Broker Shop is a funding brokerage, not a lender. We take one application and put it in front of 50+ competing lenders whose guidelines your situation actually meets, so offers arrive side by side instead of one at a time. Checking your options won’t affect your credit score, and it is free to apply.
Be clear about which part of an acquisition that helps with. Where our network is strongest is the working capital around the deal — funding the inventory, payroll and operating cushion the business needs from the day you take the keys, and refinancing or expanding once you have owned it long enough to have your own trading history. That is the piece buyers most often underestimate, and it is the piece the acquisition loan usually does not cover generously.
For the purchase itself, an SBA-experienced lender or a specialist acquisition lender is the right first call, and we will tell you so rather than push a product that does not fit. Once you have owned the business for six months and it is depositing under your name, the full range of options in our guide to small business funding options opens up, and the comparison we run becomes genuinely useful. Until then, the honest answer is that this is a different kind of loan.
Frequently Asked Questions
The bottom line: You can finance buying a business, but not with the fast products that fund an operating one — an SBA 7(a) loan plus seller financing and your own cash injection is the usual structure, and it is underwritten on the target’s cash flow rather than yours.
Sources: U.S. Small Business Administration — 7(a) loans (eligible uses including changes of ownership; $5 million maximum loan amount) · Federal Reserve Banks — 2026 Report on Employer Firms: Findings from the 2025 Small Business Credit Survey