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Capital Solutions · SBA Programs

SBA 7(a) & 504 Loans
for Senior Housing
Acquisitions

SBA financing is among the most powerful tools available to senior housing buyers, operators, and developers. With as little as 10% down, 25-year amortization, and no balloon payments, SBA 7(a) and 504 loans unlock acquisitions that conventional financing cannot support. Haven connects senior housing borrowers to SBA-experienced lenders across all 50 states.

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10%
Minimum equity
existing businesses
25 yr
Max amortization
real estate loans
$5M
SBA 7(a) max
loan amount
No
Balloon payments
required
SBA 7(a) vs. SBA 504 — At a Glance
SBA 7(a)
Max loan$5M
Equity req.10% (existing)
RE termUp to 25 yr
W/C termUp to 10 yr
Rate typeVariable or fixed
2026 rates~9.75–14.75%
GoodwillYes — eligible
Location req.None
SBA 504
SBA portionUp to $5.5M
Equity req.10% (standard)
RE term20 or 25 yr
Structure50/40/10
Rate typeFixed (CDC portion)
2026 rates~5–7% (CDC)
GoodwillNo — RE/equipment
Owner occ. req.51%+ required
Why SBA for Senior Housing

Senior Housing Is a
Special-Use Property.
SBA Understands That.

Senior housing — assisted living, memory care, and similar licensed care businesses — is classified as special-use property by most commercial lenders. This means conventional lenders often require 30–40% down, offer shorter terms, and are reluctant to finance the business goodwill component at all. Many simply decline.

SBA financing was built for exactly this gap. The government guarantee reduces lender risk — enabling lenders to offer dramatically better terms than they could extend without it. For senior housing buyers, SBA 7(a) is frequently the only path to an acquisition that is economically viable with a reasonable equity contribution.

SBA 7(a) can finance goodwill
Unlike conventional and most other government programs, SBA 7(a) can finance the business goodwill component of a senior housing acquisition — the licenses, relationships, census, and going-concern value that often represent the majority of a facility's worth
10% down vs. 30–40% conventional
SBA programs require as little as 10% equity for existing businesses — enabling acquisitions that would require 3–4x more capital through conventional channels
No balloon payments
Fully amortizing loan structures with no balloon risk — critical for operators whose cash flow needs stability, not refinancing uncertainty at the 5- or 7-year mark
SBA-experienced lenders know the asset class
Not all SBA lenders understand senior housing underwriting. Haven connects borrowers specifically to SBA lenders who have completed senior housing transactions
SBA vs. Conventional — Senior Housing Acquisition
Factor
Conventional Bank
SBA 7(a)
Down payment
30–40%
10% existing biz
Loan term
5–20 yr (balloon)
25 yr — no balloon
Goodwill financed
Rarely
Yes — eligible
Working capital
Separate line
Included in loan
Special-use appetite
Low — higher rates
Structured for it
Startup financing
Very difficult
Available — 10% down
Rate basis
Risk-adjusted — higher
Prime + 2.25–4.75%
Program One

SBA 7(a) — The
Versatile Workhorse

The SBA 7(a) is the most versatile and most commonly used SBA program for senior housing acquisitions. Its defining advantage in this asset class: it can finance both the real estate and the business goodwill in a single loan — a capability no other government-backed program provides.

For an assisted living or memory care acquisition where significant business value exists beyond the real estate, the 7(a) is often the only viable government-backed option. It also allows seller financing to count as part of the equity injection — when structured on full standby — reducing the buyer's out-of-pocket requirement further.

Critical Advantage for Senior Housing
SBA 7(a) is the only SBA program that can finance business goodwill — licenses, relationships, and going-concern value. For assisted living acquisitions where goodwill is a significant portion of purchase price, this distinction is decisive.
Eligible Uses — SBA 7(a)
Acquisition of existing assisted living, memory care, or senior housing businesses — including real estate and goodwill
Construction, renovation, or improvement of senior housing facilities
Furniture, fixtures, and equipment (FF&E) purchase
Working capital — initial operating reserves, staffing, and pre-opening costs
Refinancing of existing senior housing debt — including existing SBA 7(a) loans
Partial business acquisition with co-guarantors (permitted under SOP 50 10 8)
SBA 7(a) — Program Terms
Maximum loan amount$5,000,000
SBA guarantee75% (loans over $150K)
85% (loans under $150K)
Equity — existing business10% minimum
Equity — startup/new10–30% (special use may require more)
Real estate termUp to 25 years
Equipment/working capitalUp to 10 years
Interest rate (2026)Prime + 2.25% to 4.75%
(~9.75–14.75% as of Apr 2026)
Rate typeVariable (most common) or fixed
Balloon paymentsProhibited — fully amortizing
Goodwill financingYes — eligible use of proceeds
Seller note — standbyFull standby required (max 50% of equity)
SBSS score minimum165 (raised from prior guidance)
Personal guaranteeRequired — all 20%+ owners
CollateralAll business and personal assets; real estate when available
Rates as of April 2026 — Wall Street Journal Prime Rate 7.50%. Variable rates adjust with Prime. Fixed-rate options available through select lenders. Actual terms depend on lender, borrower profile, and deal structure.
Program Two

SBA 504 — Fixed Rate
for Real Estate & Equipment

The SBA 504 program offers a compelling alternative to the 7(a) for senior housing acquisitions and construction where the primary need is long-term, fixed-rate financing for real estate and major equipment — without the need to finance business goodwill.

The 504 structure is distinctive: a traditional lender provides 50% of the project cost, a Certified Development Company (CDC) provides 40% at a fixed rate guaranteed by the SBA, and the borrower contributes 10%. The CDC portion carries a fully fixed rate for 20 or 25 years — eliminating rate risk on the largest portion of the project cost.

The 504 is well-suited to senior housing developers and operators acquiring or constructing owner-occupied facilities — where long-term rate certainty and minimal equity are the priority, and goodwill financing is not needed.

Eligible Uses — SBA 504
Purchase of owner-occupied senior housing real estate (51%+ occupancy by borrower's business)
Ground-up construction of assisted living, memory care, or independent living facilities
Major renovation, rehabilitation, or expansion of existing senior housing property
Purchase of major equipment — medical, dietary, laundry, HVAC systems
Refinancing of existing SBA 7(a) or conventional senior housing debt (with or without expansion)
SBA 504 — Capital Stack Structure
50%
Traditional Lender (Bank)
Senior debt — conventional commercial mortgage. Lender sets own rate and terms. Typically 5–7 year balloon with 25-year amortization, or variable rate.
40%
SBA / Certified Development Company (CDC)
Fully fixed rate — 20 or 25 year term. Rate tied to 10-year U.S. Treasury + spread. Rates typically 5–7% (2026). No balloon. SBA guarantees 100% of CDC portion.
10%
Borrower Equity
Standard 10% down. May increase to 15% for startups or 15–20% for special-use properties in some cases. Cannot be seller-financed on the 504 portion.
SBA 504 — Program Terms
SBA/CDC max loan$5M standard / $5.5M with green goals
Total project rangeTypically $500K–$20M+
Loan terms (CDC)20-year or 25-year fixed
Rate — CDC portion~5–7% fixed (10-yr Treasury + spread)
Equity (standard)10% borrower contribution
Owner occupancy51% required for existing; 60% new construction
Goodwill financingNot eligible — real estate and equipment only
Balloon (CDC portion)None — fully amortizing fixed
FY2026 Fee Structure

SBA Guarantee Fees —
FY2026 (Oct 2025 – Sep 2026)

The SBA publishes updated guarantee fee schedules each fiscal year. Fees below apply to loans approved October 1, 2025 through September 30, 2026.

SBA 7(a) Guarantee Fees — FY2026

SBA 7(a)

Loan AmountGuarantee Fee
Up to $1,000,0000.00%
$1,000,001 – $2,000,0001.45% on first $1M + 1.70% on excess
$2,000,001 – $5,000,0003.50% on first $1M + 3.75% on excess
Fee applies only to the SBA-guaranteed portion, not the full loan amount. Fees may be financed into the loan. SBA 7(a) fee structure unchanged from prior guidance for FY2026. Veterans and qualifying borrowers may be eligible for fee waivers.
SBA 504 Fees — FY2026 (Reinstated)

SBA 504

Fee TypeRate (FY2026)
Upfront guarantee feeReinstated for non-manufacturers
Annual service fee0.209% standard + 0.0025% supplemental
Debt refinance w/o expansionAdditional supplemental annual fee
Manufacturer borrowers (NAICS 31–33)Full waiver — upfront and annual
SBA 504 fees were reinstated for FY2026 for most non-manufacturer borrowers after having been waived in prior years. The fee applies to the CDC portion only, not the bank or borrower equity portion. Confirm current fee structure with your lender at time of application.
SOP 50 10 8 — Key Updates

SBA Policy Changes
Affecting Senior Housing Borrowers

SBA Standard Operating Procedure 50 10 8 introduced several changes relevant to senior housing acquisitions and refinancing. Key items borrowers and lenders should know:

Equity Injection
10% Equity — Seller Notes Permitted on Full Standby
Minimum 10% equity injection required. A seller note held on full standby for the life of the SBA loan may be counted as part of the equity injection — up to 50% of the required contribution. This enables deals where the buyer has limited cash but a seller willing to carry on standby terms.
Partial Acquisitions
Partial Ownership Purchases Now Permitted
SOP 50 10 8 permits partial business ownership purchases with co-guarantors — enabling partnership structures where one party acquires a partial interest in an existing senior housing business. Previously restricted. Requires all relevant parties to provide personal guarantees.
Personal Resources
Personal Resource Test Removed
The "personal resource test" — which previously required lenders to assess whether a borrower could fund the project personally before approving SBA assistance — has been removed. The credit-elsewhere standard (demonstrating that conventional financing is unavailable on reasonable terms) still applies.
SBSS Score
Minimum SBSS Score Raised to 165
The minimum Small Business Scoring Service (SBSS) score — used by SBA lenders for preliminary credit screening — was raised to 155 under prior guidance and then to 165 under SOP 50 10 8. Borrowers with scores below 165 will typically require more documentation and manual underwriting review.
Insurance
Life & Hazard Insurance Required Above $50K
For secured loans above $50,000, SBA lenders are required to verify that adequate life insurance and hazard insurance on collateral are in place. Life insurance must be sufficient to cover the outstanding loan balance in the event of the key guarantor's death. Confirm coverage requirements with your lender at application.
Franchise Directory
Franchise Directory Reinstated
The SBA Franchise Directory — which lists franchise systems approved for SBA lending — was reinstated under SOP 50 10 8. Senior housing operators using a franchise model (e.g., licensed branded care programs) should confirm their franchise's directory status before applying, as unapproved franchise relationships may complicate SBA eligibility.
The SBA Financing Process

From Introduction
to Closing

1

Lender Introduction

Haven introduces you to SBA lenders with senior housing experience — not all SBA lenders understand the asset class or want to underwrite it

2

Pre-Qualification

Lender reviews your credit, personal financial statement, deal structure, and business plan — providing preliminary feedback on deal viability before full application

3

Full Application

Complete SBA application package — business financials, tax returns, purchase agreement, licenses, business plan, and appraisal. Haven helps you prepare and present

4

SBA Review & Approval

Lender submits to SBA for guarantee approval. Timeline: 30–90 days depending on lender type. SBA Preferred Lenders can approve in-house — faster closing

5

Closing & CHOW

Loan closes; funds disbursed. For senior housing acquisitions, state CHOW (change of ownership) and license transfer proceed in parallel — Haven supports navigation

Haven Capital Solutions

Haven Connects Senior Housing
Borrowers to SBA Lenders

Haven Senior Investments is a capital broker — not a lender or originator. We have no financial interest in which lender or program you choose. Our role is to understand your deal, identify the most appropriate SBA program, and introduce you directly to SBA lenders who have senior housing experience and appetite.

Not all SBA lenders are the same. Many banks participate in SBA programs but rarely close senior housing transactions. Haven's lender network is specifically filtered for senior housing experience — lenders who understand care home licensing, CHOW timelines, and goodwill valuation.

Program selection guidance
Haven helps you determine whether 7(a) or 504 — or a combination — is the right structure for your specific deal, asset type, and goals
SBA lender introductions
Direct introductions to SBA lenders with verified senior housing transaction experience — not generic referrals to your local bank
Deal package preparation support
Guidance on assembling the business plan, financial projections, and deal documentation that SBA lenders expect — presented in the format they need
Transaction support through closing
Haven stays engaged through underwriting, CHOW coordination, and closing — ensuring the SBA and transaction timelines stay aligned
Haven Senior Investments provides informational resources and third-party lender referrals. We encourage independent due diligence before engaging with any lender or program. Haven assumes no liability for outcomes related to third-party lender services. All SBA program details are subject to change — confirm current requirements with your lender at time of application.
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