Tap to get financing
SBA 7(a) Loans
SBA 7(a) Loans
Uses for the SBA 7(a) LoanCompare SBA LoansFund a StartupBuy EquipmentGet a Commercial MortgageRepair CapitalRefinance Business DebtGet a Working Capital LoanBuy a BusinessLearn About the SBA Lending ProcessFind an SBA Lender
Requirements Rates Loan Calculator
SBA Tools
SBA 7(a) Loan CalculatorSBA 504 Loan Calculator
Blog
About Us
About usContact us
Get financing
Close sba7a.loans is an independently owned and operated website and has no government affiliation. We are not the Small Business Administration and are not a lender. If you are trying to reach the SBA click here to be redirected.
Newly Published
Oct 27 at SBA 7(a) Loans
Small Business Loans Guide: Before You Start
Aug 26 at SBA 7(a) Loans
Who Are Specialized Lenders in the SBA 7(a) Loan Program?
Aug 26 at SBA 7(a) Loans
Writing a Proposal for the SBA 7(a) Loan
Explore the Janover Network
Mar 27 at Multifamily Loans
How to Navigate Multifamily Tax Credits
Mar 27 at Multifamily Loans
Multifamily Minute Reader Reflections: Interest Rate Outlooks
Mar 24 at Multifamily Loans
The Best 3 Multifamily Loans for Affordable Housing in 2023
Was This Article Helpful?
Small Business and SBA Lending Blog
Last updated on Feb 19, 2023
2 min read

Getting 100% Commercial Real Estate Financing With An SBA 7(a) Loan

While most forms of SBA 7(a) loans require at least 5-10% down, some lenders are now offering 100% commercial property financing with SBA 7(a) loans. That means that, if they qualify, a borrower doesn’t have to put anything down to acquire a commercial property with a 7(a) loan .

Apply for a loan in minutes and get multiple quotes today → Get Quotes

In this article:
  1. Who Qualifies for 100% SBA 7(a) Commercial Real Estate Financing?
  2. 100% CRE Financing Does Not Apply to Business Acquisitions
  3. SBA 7(a) Loans Can Also Offer 100% Construction Financing
  4. What Types of Buildings Are Eligible for 100% Financing?
  5. Related Questions
  6. Get Financing

While most forms of SBA 7(a) loans require at least 5-10% down, some lenders are now offering 100% commercial property financing with SBA 7(a) loans. That means that, if they qualify, a borrower doesn’t have to put anything down to acquire a commercial property with a 7(a) loan.

Who Qualifies for 100% SBA 7(a) Commercial Real Estate Financing?

While exact requirements can vary by lender, in general, to achieve 100% CRE financing, a borrower will need:

  • Great personal and business credit

  • A significant amount of collateral

  • Debt service coverage ratio (DSCR) of 1.25x or greater

  • History of stable and positive cash flow (1.5 years typically required)

  • The business must occupy at least 51% of the property in question

  • The building must be a general use or multi-use property (properties with highly specific uses are much riskier for both lenders and the SBA)

100% CRE Financing Does Not Apply to Business Acquisitions

If you want to get an 100% commercial real estate financing with an SBA 7(a) loan, you’ll need to fully own the business already. In order to buy a business and a building, you would need at least 10% down— though 5% of that can come from a seller note.

SBA 7(a) Loans Can Also Offer 100% Construction Financing

SBA 7(a) loans don’t only allow eligible business owners to purchase an existing building with zero down, they can also allow them to build an entirely new structure for their business. However, to achieve 100% construction financing with a 7(a) loan, a borrower will need to have especially strong financials, and their business will have to occupy at least 60% of the finished structure (as opposed to the 51% minimum for property acquisitions.)

What Types of Buildings Are Eligible for 100% Financing?

Other than general and mixed use buildings, which are generally eligible, other eligible building types for 100% SBA 7(a) financing include:

  • Medical and dental offices and clinics

  • Office condos

  • Professional office buildings

  • Pharmacies

  • Auto-repair businesses (including tires, muffler repair, and transmission firms)

  • Pre-schools

  • Certain fast-food/quick service restaurant buildings

Related Questions

What are the requirements for getting 100% financing for a commercial real estate purchase with an SBA 7(a) loan?

In order to get 100% financing for a commercial real estate purchase with an SBA 7(a) loan, you will need:

  • Great personal and business credit
  • A significant amount of collateral
  • Debt service coverage ratio (DSCR) of 1.25x or greater
  • History of stable and positive cash flow (1.5 years typically required)
  • The business must occupy at least 51% of the property in question
  • The building must be a general use or multi-use property (properties with highly specific uses are much riskier for both lenders and the SBA)

Note that 100% CRE financing does not apply to business acquisitions. If you want to buy a business and a building, you would need at least 10% down— though 5% of that can come from a seller note.

What types of commercial real estate properties are eligible for an SBA 7(a) loan?

The SBA 7(a) loan program is available for a variety of commercial real estate properties, including general and mixed use buildings, medical and dental offices, office condos, professional office buildings, pharmacies, auto-repair businesses, pre-schools, and certain fast-food/quick service restaurant buildings.

For more information about the SBA 7(a) loan program, please click here.

What are the advantages of using an SBA 7(a) loan for commercial real estate financing?

The advantages of using an SBA 7(a) loan for commercial real estate financing include:

  • SBA 7(a) loans are typically easier to qualify for than other types of loans.
  • They can be used for a variety of purposes, including the purchase of commercial real estate.
  • They have terms of up to 25 years for real estate, which can make them easier to repay.

According to ReadyCap Lending, real estate loans typically require 10% down and carry terms of up to 25 years.

What are the disadvantages of using an SBA 7(a) loan for commercial real estate financing?

The disadvantages of using an SBA 7(a) loan for commercial real estate financing include:

  • Lengthy approval times (for standard SBA 7(a) loans)
  • Lots of documentation
  • Collateral is often required
  • Certain businesses, including real estate investing, lending, gambling, and speculation are prohibited
  • High credit scores are typically required (typically 680+)
  • May be restrictions on supplemental/additional financing
Source 1 Source 2

How long does it take to get approved for an SBA 7(a) loan for commercial real estate financing?

If you are working with a Certified Lender, the SBA can expedite the application process and it will only take three business days. Most terms for SBA 7(a) loans limit repayment to 10 years, and working capital loans are usually restricted to seven years. But the maturity for real estate and construction loans runs up to 25 years.

In this article:
  1. Who Qualifies for 100% SBA 7(a) Commercial Real Estate Financing?
  2. 100% CRE Financing Does Not Apply to Business Acquisitions
  3. SBA 7(a) Loans Can Also Offer 100% Construction Financing
  4. What Types of Buildings Are Eligible for 100% Financing?
  5. Related questions
  6. Get Financing
Tags
  • SBA 7(a) Loans
  • SBA Loans
  • SBA 7(a)
  • SBA Business Loans
  • SBA 7(a) Commercial Real Estate
  • SBA CRE Loans

Getting a small business loan should be easy.⁠ Now it is.

Click below for a free, no obligation quote and to learn more about your loan options.

Get financing →
Janover logo

SBA 7(a) Loans is a Janover company. Please visit some of our family of sites at: Multifamily Loans, Multifamily Today, Commercial Real Estate Loans, SBA7a Loans, CMBS Loans, Apartment Loans, HUD Loans, HUD 221d4 Loan, HUD 232 Loan, HUD 223f Loan, HUD 223a7 Loan, SBA Express Loans, SBA 504 Loans, and OpportunityZones Help.

Janover Inc.

6401 Congress Ave
Ste 250
Boca Raton FL 33487

hello@sba7a.loans

SBA 7(a) Loans

SBA Loan Comparison
SBA 7(a) Loan Fees, Rates, and Terms
Qualifying for an SBA 7(a) Loan
SBA Loan Guides per State

Site Information

Privacy Policy
Terms of Use
Advertiser Disclosure

This website is owned by a private company that offers business advice, information and other services related to multifamily, commercial real estate, and business financing. We are a technology company that uses software and experience to bring lenders and borrowers together.

All users should perform their own due diligence and research. Nothing on this website is an offer or a solicitation for a loan. This website does not endorse or charge you for any service or product. None of the information on this site constitutes legal advice. We are not affiliated with the Small Business Administration (SBA). If you need to visit the SBA directly please click here: sba.gov

Click here for our Advertiser Disclosure.

Copyright © 2023 Janover Inc. All rights reserved.