One of the first questions we hear from prospective buyers is simple, “How do I actually pay for a business?”

It’s a good question and one that can feel overwhelming at first, especially since buying a business is a huge financial commitment. The reality is, most buyers don’t purchase a business with cash. Instead, deals are structured using a combination of financing options that work together. 

For many buyers, the starting point is an SBA loan. These loans have been popular for many years because they offer lower down payments and longer repayment terms than traditional financing. But, there’s an important update for 2026 that buyers need to be aware of. As of this year, green card holders are no longer eligible for SBA loans and businesses must now be fully owned by U.S. citizens or nationals to qualify. This is a significant shift and may affect how some buyers approach financing or structure ownership.

Luckily, there are multiple sources of financing. Common components include:

• Bank or SBA loans to cover a portion of the purchase price.
• Seller financing, where the seller carries part of the deal.
• Buyer equity, which is the buyer’s own cash investment.
• In some cases, partners or outside investors to help fund the purchase.

It’s not unusual for a deal to include two or even three of these elements working together. In fact, that’s often what makes a transaction possible.

But, no matter how the deal is structured, lenders are looking for the same things. They want to know the business is strong and that the buyer is capable of running it successfully. That’s why a few factors consistently matter:

• Reliable cash flow — The business needs to generate enough income to support loan payments.
• Buyer experience — Lenders want to see that you understand the business or industry.
• Skin in the game — Most buyers are expected to contribute their own capital.
• Stability of the business — Predictable operations reduce risk for everyone involved.

The bottom line is that financing a business purchase isn’t about finding one perfect solution. It’s about building the right combination of resources to get the deal done, and making sure it works long-term. If you want to buy a business this year, the best thing you can do for yourself is to prepare for the purchase. Understanding your financing options ahead of time, knowing what you can afford, and being ready to move when the right opportunity appears can make a significant difference.

At Calhoun Companies, we work closely with buyers throughout this process, helping them understand their options, connect with lenders, and structure deals that make sense. If you’re exploring your options, we’re always happy to have a confidential conversation.