Can you really secure more than $5 million in SBA financing? The answer is yes, and it’s not as complicated as you might think. Recently, I attended a broker roundtable with a seasoned SBA lender who specializes in structuring deals that exceed the typical limits. Let’s dive into how you can navigate the intricacies of SBA financing.

First off, let’s talk about the SBA's affiliation rules. Generally, you can only have an aggregate of $5 million in SBA financing. However, savvy lenders know how to structure ownership to avoid triggering these rules. If someone owns less than 49% of a business, they can often sidestep affiliation issues.

Consider a gas station example. Multiple owners can strategically structure their ownership percentages. This means you can have more than $5 million in financing across different entities without running afoul of affiliation rules. It's crucial, though, that you don’t hold a controlling interest of 100% in any one company.

I’ve heard about these strategies for years but never found solid evidence until now. The lender I spoke with regularly closes deals where the guarantor has more than $5 million in SBA financing, as long as the companies involved have no affiliations. They know how to navigate the SOP (Standard Operating Procedure) and can make these deals happen.

Another way to structure your financing is through family members. Spouses or relatives can own separate businesses without triggering the affiliation rules, giving you more flexibility in financing options.

It's not just about avoiding affiliation; you also need to ensure your deal structures can pass SBA tests. This is where working with the right lender becomes crucial. They can help you navigate the nuances of the SOP to secure the financing you need.

Looking ahead, I'm optimistic about the future of SBA loan limits. The current $5 million cap has been around since 2010, and it’s about time for a change. I anticipate we could see limits raised to $7.5 million or even $10 million in the next couple of years, unless we face a severe recession.

Many people are unaware that you can structure CPCE financing with SBA 7(a) loans. While not all lenders will do this, there are definitely banks and non-bank lenders willing to explore these options. It’s all about finding the right partner.

If you’re interested in creating a legacy for your family through business ownership, I highly recommend attending our Business Ownership Summit. We provide valuable insights into leveraging SBA financing, tax strategies, and more. Check out our events at Business Ownership Academy.

If you have any questions about SBA loans or need assistance, feel free to book a call with me at Book with Beau. I’m here to help you navigate these waters and secure the financing you need.

Understanding SBA financing can be complex, but with the right strategies and partnerships, you can unlock significant funding for your business. Don't hesitate to reach out for assistance, and remember: if one lender says “no,” another may say “yes.” Stay informed, and keep pushing forward!