SBA Owner-Occupied Real Estate Purchase Loans

SBA Owner-Occupied
Real Estate Purchase Loans

SBA Loans

SBA Owner-Occupied Real Estate Purchase Loans

Owner-occupied commercial real estate is one of the strongest financing opportunities we’ve seen in years. Commercial real estate lending volume rose sharply in 2025 as Fed rate cuts restored confidence among borrowers and lenders, and SBA-backed loan demand has been climbing alongside it. (Forbes) Prices in many markets remain reasonable, and financing is competitive – a window that tends to narrow once rates ease further and demand catches up.

Buying instead of leasing isn’t just a purchase – it’s a long-term positioning move: fixed occupancy costs instead of rising rent, equity growth instead of rent checks, and a stronger balance sheet and exit profile. For many owners, it becomes the foundation everything else is built on.

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At a Glance

Down Payment	10% (both programs); as low as 0% for qualifying same-industry expansion acquisitions financed through 7(a)
Terms	Up to 25 years
Occupancy Requirement	51% of an existing building; 60% for new construction
SBA Programs Available	Both 7(a) and 504 - see SBA 7(a) Loans and SBA 504 Loans for full program details

Occupancy Requirement

Both SBA programs require the property to be owner-occupied, not a passive real estate investment:

The remaining space can be leased to other tenants. Expect an independent appraisal and environmental due diligence (often a Phase I environmental report) as part of underwriting – both are standard, financeable closing costs, not separate out-of-pocket expenses in most cases.

Which SBA Program Fits Your Purchase

If you only need to finance the building and want a fixed rate for the life of the loan, SBA 504 is often the stronger structure. If the real estate purchase is bundled with other business needs – working capital, equipment, or a business acquisition – SBA 7(a) offers more flexibility in a single loan. See either program’s page for full terms, structure, and eligibility.

Buying Real Estate as Part of a Business Acquisition

When a real estate purchase is bundled into an SBA 7(a) business acquisition loan, the amortization depends on how the loan proceeds are split:

This is a detail worth structuring around early in a deal – how the purchase price is allocated between real estate and business value can meaningfully change your monthly payment.

Pre-Qualification Basics

Before we can pre-qualify a real estate purchase, we’re generally looking at:

Down payment funds - 10% standard, ready to document (or a qualifying 0%-down expansion scenario)
Occupancy plan - confirmation your business will occupy at least 51% (or 60% for new construction)
Credit and cash flow - a personal credit score generally in the high 600s or above, and business cash flow sufficient to cover the new debt
Property type and use - the property must support your actual business operations, not serve as a passive investment

SBA financing isn’t the only path to owning your building. If SBA eligibility, timelines, or program restrictions don’t fit your deal, we also offer conventional owner-occupied real estate financing with its own set of terms.

Ready to Buy Your Building?

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FAQ's

Frequently Asked Questions

Do you offer non-SBA financing for owner-occupied real estate purchases?

Yes – alongside SBA 7(a) and 504, we offer conventional owner-occupied real estate financing for buyers who don’t need or don’t qualify for an SBA-backed loan.

Can I use an SBA loan to buy the building my business operates from?

Yes – both SBA 7(a) and SBA 504 finance owner-occupied commercial real estate, typically with 10% down and terms up to 25 years.

What percentage of a building do I need to occupy?

At least 51% for an existing building, or 60% for new construction. The rest can be leased to other tenants.

Should I use SBA 7(a) or 504 for a real estate purchase?

504 is often better if you only need the real estate and want a fixed rate for the full term. 7(a) is often better if you want to bundle the purchase with working capital, equipment, or a business acquisition in a single loan.

If I'm buying a business with real estate included, how does that affect my loan term?

If real estate makes up 51% or more of the total loan proceeds, the whole loan gets a 25-year term. Below that threshold, most lenders default the entire loan to a 10-year amortization.

Can I buy real estate with no money down?

In specific cases, yes – if you already own a profitable business and are acquiring real estate as part of a same-NAICS-code expansion financed through SBA 7(a), the deal may qualify for 0% down.

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