Acquisition Calculator
Deal Viability Calculator
Will the cash flow cover the debt? Slide the inputs to model an SBA-financed acquisition over its 10-year amortization. The chart shows cash flow after debt service per year; the verdict pill calls out whether a lender will approve and whether you'll have buffer for surprises.
Will the cash flow cover the debt?
How this works
The math is standard SBA 7(a) acquisition modeling. We compute the purchase price as SDE × multiple, the loan amount as purchase price minus down payment, and the level-payment monthly amortization at the chosen rate over a 10-year term — the SBA's standard term for goodwill-heavy acquisitions where no real estate is included.
The verdict pill is driven by the year-1 DSCR (the ratio of cash available for debt service to the actual annual debt service). The thresholds match SBA convention: 1.15× is the floor most SBA-preferred lenders enforce, 1.25× is what conservative banks want to see, and 1.50× and up is comfortable buffer territory. The shaded bands on the chart correspond to those thresholds.
Down payment is bounded at 10% — the minimum equity injection required by SOP 50 10 8 (effective June 1, 2025). Rates are bounded at the realistic 2026 range; the SBA caps variable-rate 7(a) loans at Prime + 3.0%.
What this calculator doesn't model
- • SBA guarantee fee. Typically 2–3.5% on the guaranteed portion of loans over $500K, financed into the loan. Materially affects total cost but not first-year DSCR.
- • Working capital. A real deal needs cash at close for working capital, deal costs, and a runway buffer beyond the down payment.
- • Variable rates. Most 7(a) loans float with Prime. We treat the slider rate as fixed for projection purposes — slide up to model what happens if rates rise.
- • Seller note effects. Seller financing on full standby can count toward up to half the equity injection. Model it separately with the Seller Note Builder.