Buying an existing business is often faster and safer than starting one. It comes with customers, staff, and tax returns. It also comes with a harder set of questions.
A lender wants to know whether the business can carry new debt. An E-2 visa officer wants to know whether your money is at risk in a real, non-marginal enterprise. Both want a business acquisition plan. They read it differently.
Here is the part most guides miss: under 2026 SBA rules, the same buyer usually cannot use both. This guide explains why, then shows how to write an acquisition plan for each route.
SBA Loan or E-2 Visa: Which Route Applies to You?
Since 1 March 2026, every direct and indirect owner of an SBA borrower must be a U.S. citizen or U.S. national with a principal residence in the U.S. SOP 50 10 8.1 extends that test to SBA-required guarantors from 1 October 2026.
An E-2 investor is, by definition, a foreign national. So an E-2 buyer cannot own any part of a company financed with an SBA 7(a) or 504 loan.
| Buyer Profile | SBA 7(a) Acquisition Loan | E-2 Visa Acquisition |
| U.S. citizen | Eligible | Not applicable |
| Green card holder | Not eligible as owner | Not applicable |
| Treaty-country national | Not eligible as owner | Eligible |
| Mixed ownership (citizen plus foreign national) | Not eligible | Possible if treaty nationals hold 50%+ |
If you hold a green card, see what green card holders can do instead of SBA.
The rest of this guide covers both plans, because the structure overlaps and many advisors serve both buyer types.
Shared Core of Every Acquisition Plan
Whether you write for a lender or a consular officer, five sections carry the weight.
1. Target Business Profile
- Legal entity, years in operation, location
- Products, services, and customer base
- Three years of revenue, gross margin, and owner earnings
- Staff count and key employees
- Reason for sale
2. Purchase Price and Valuation
- Asking price and agreed price
- Valuation method (multiple of SDE or EBITDA, asset-based, or income approach)
- Independent valuation for SBA deals above the small loan threshold
3. Deal Structure
- Asset purchase or stock purchase
- What transfers: equipment, inventory, goodwill, contracts, lease
- Seller financing terms
- Non-compete and transition agreement
4. Transition Plan
- How long the seller stays and what they hand over
- Customer and supplier introductions
- Licenses and permits that must be reissued
5. Post-Acquisition Growth Plan
- What you will change and why
- New revenue lines, pricing, or cost savings
- Hiring plan
Writing the SBA Acquisition Plan
Appendix 15 Category
Every 7(a) change of ownership now sits in one of four categories. Identify yours on page one.
| Category | Minimum DSCR Reported | Equity Injection | QoE at $3M+ |
| Initial Acquisition | 1.25x | 10%, no reduction | Required |
| Business Expansion | 1.15x | 10%, reducible with liquidity | Required |
| Owner Buyout | 1.25x | 10%, reducible | Not required |
| ESOP or Cooperative | Lender analysis | Exempt | Not required |
Historical Coverage, Not Forecasts
For Initial Acquisitions and Owner Buyouts, lenders measure debt service coverage on the last fiscal year or a two-year average, adjusted for documented add-backs. Your plan should present this calculation clearly:
| Item | FY2024 | FY2025 | Average |
| Net income | $210,000 | $238,000 | $224,000 |
| Add back: depreciation | $18,000 | $20,000 | $19,000 |
| Add back: interest | $6,000 | $5,000 | $5,500 |
| Add back: seller’s excess salary | $40,000 | $40,000 | $40,000 |
| Less: buyer’s market salary | ($85,000) | ($85,000) | ($85,000) |
| Cash available for debt service | $189,000 | $218,000 | $203,500 |
| Proposed annual debt service | $152,000 | ||
| DSCR | 1.34x |
Every add-back needs proof. Undocumented add-backs get removed, and the DSCR drops.
Quality of Earnings
For Initial Acquisitions and Business Expansions priced at $3 million or more, excluding owner-occupied real estate, the lender orders an independent QoE. A report you commissioned yourself does not count. If the QoE finds lower earnings, the loan size falls. Read Quality of Earnings vs business plan to see how the two documents fit together.
Equity Injection Sources
On a $2 million acquisition, the required $200,000 injection can include no more than $100,000 from limited sources such as a full-standby seller note. At least $100,000 must be your own cash or equivalent.
Seller Transition
Under SOP 8.1, a seller can consult for up to 24 months after a full sale. Your plan should list the handover tasks by month.
For a deeper lender view, see what underwriters look for in an SBA acquisition loan.
Writing the E-2 Acquisition Plan
Investment Counting
For an E-2 purchase, the purchase price paid by the investor counts toward the investment. So do working capital injections and post-closing upgrades. Seller financing does not count unless it is secured by the investor’s personal assets.
Practical tip: Use an escrow agreement that releases funds to the seller only if the E-2 visa is approved. Officers accept escrowed funds as committed.
Proving the Business Is Not Marginal
An existing business with payroll helps. Show current employees, their roles, and how you will keep and grow them.
| Year | Existing Staff Retained | New Hires | Total U.S. Staff |
| At closing | 5 | 0 | 5 |
| Year 1 | 5 | 1 | 6 |
| Year 3 | 5 | 3 | 8 |
| Year 5 | 5 | 5 | 10 |
Struggling Businesses
Buying a declining business at a lower price can work for E-2, but the plan must show a credible turnaround. Our guide to E-2 plans for acquiring struggling businesses covers the format.
Investment Size
The investment must be substantial relative to the purchase price. A buyer paying 30% down on a $600,000 business, with the seller carrying the rest unsecured, will struggle. See E-2 substantial investment by industry.
Acquisition vs Startup: ROI and Risk Framework
Buyers often ask whether buying beats building. The answer depends on price, risk tolerance, and how fast you need cash flow.
| Factor | Buying an Existing Business | Starting From Scratch |
| Time to positive cash flow | Day one, if the business is profitable | Often 12 to 24 months |
| Upfront cost | Higher, includes goodwill | Lower, but ramp-up losses add up |
| Lender view | Historical cash flow supports the loan | Projections only, higher scrutiny |
| E-2 view | Existing payroll helps prove non-marginality | Hiring plan must carry the case |
| Key risk | Overpaying for earnings that do not hold | Revenue never reaches projections |
| Due diligence load | Heavy (tax returns, QoE, contracts) | Lighter, market research heavy |
A quick payback test: Divide the total purchase price by verified annual owner cash flow after your market salary. A $900,000 business producing $225,000 has a four-year payback. Compare that to the cost and ramp time of building the same revenue yourself. If a startup would take three years to reach $225,000 and burn $300,000 on the way, the acquisition often wins.
SBA vs E-2 Acquisition Plan: Key Differences
| Plan Element | SBA Acquisition Plan | E-2 Acquisition Plan |
| Main reader | Credit officer | Consular officer or USCIS |
| Core test | Repayment capacity | Substantial, at-risk, non-marginal investment |
| Financing | Up to 90% debt | Mostly investor equity |
| Seller note role | Counts as limited equity if on full standby | Rarely counts unless personally secured |
| Coverage measure | Historical DSCR | Not a formal test |
| Job emphasis | Light | Heavy |
| Projection horizon | 3 years | 5 years |
| Valuation | Independent valuation required for most deals | Recommended, supports price |
Due Diligence Checklist for Acquisition Plans
- Three years of business tax returns
- Year-to-date profit and loss and balance sheet
- Bank statements matching reported revenue
- Lease and assignment terms
- Customer concentration analysis (any client above 15% of revenue)
- Employee roster and wage history
- Equipment list with condition
- Licenses and permits that transfer or must be reissued
- Pending litigation or tax liens
Frequently Asked Questions
Can an E-2 visa holder use an SBA loan to buy a business?
No. Under 2026 SBA rules, every owner of an SBA borrower must be a U.S. citizen or U.S. national. E-2 investors must use their own capital, conventional financing secured by personal assets, or acceptable seller financing.
How much equity does SBA require for a business acquisition?
At least 10% of the total project for Initial Acquisitions. No more than half of that can come from limited sources such as standby seller notes.
Does a seller note count toward an E-2 investment?
Usually not. Debt secured by the business itself does not put the investor’s personal funds at risk.
Does the SBA require a business valuation?
Yes for most acquisitions, from a qualified independent source. Deals at $3 million or more also require a lender-ordered QoE.
Get an Acquisition Plan That Holds Up
An acquisition plan has to stand up to the seller’s records, the lender’s spreadsheet, or the consular officer’s questions. Getting the route right at the start avoids months of wasted effort.
BPlanWriter writes SBA acquisition business plans for U.S. citizen buyers and E-2 business purchase plans for treaty investors. Talk to our team about the deal you are reviewing.
This article is general information, not legal or lending advice.
