# Can I pair a 504 and a 7(a) to buy a business and its building?

**Short answer:** Yes. The 504 finances the eligible fixed assets and a 7(a) can finance goodwill, receivables and working capital. They must be separate loans and cannot be blended into one maturity. Source: SOP 50 10 8.1, App. 15, Para. B.1; Sec. C, Ch. 1, Para. C.13.

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Last checked: 2026-11-08

Yes, as separate loans. Appendix 15, Para. B.1, of SOP 50 10 8.1 allows one loan for the sale and one for real estate, including a 504. Section C, Ch. 1, Para. C.13, says goodwill and receivables must be financed by other means, which may include a 7(a) loan.

## What the 504 side requires

- It finances only eligible long-term fixed assets, and the application must document jobs created or retained.
- The buyer must end up owning 100% of the business, and the seller may not remain as an officer, director, stockholder or Key Employee.
- The property must appraise for 100% of the estimated value (Para. E.2.b).

## Equity on each side

Real estate bought in the deal carries the same equity requirement. If the real estate uses a 504, equity on that part follows 504 rules instead (Appendix 15, Para. C.2.a). Borrowers contribute at least 10% of the financing, 15% for a new business or limited or special purpose property, and 20% for both. On a change of ownership, the Certified Development Company (CDC) must decide whether an additional 5% is necessary (Appendix 3, New Business).

## Sequence and limits

The 7(a) loan should be processed and approved first, and lenders must flag the companion 504 application (Appendix 16, Para. A.1). SBA Notice 5000-879058 says a 7(a) balance up to the maximum loan limit does not reduce the amount available under the 504 program.

A 504 cannot be blended into a single maturity with the 7(a) loan (Appendix 15, Para. B.1). Separate loans must also meet the piggyback rules in Para. C.3.c.

## Sources

- [SOP 50 10 8.1, App. 15, Para. B.1 (p. 370)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, Sec. C, Ch. 1, Para. C.13 (about pp. 239-240)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, Sec. C, Ch. 1, Para. E.2.b (about p. 256)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, App. 15, Para. C.2.a (about pp. 374-376)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, App. 3, New Business (about p. 303)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SOP 50 10 8.1, App. 16, Para. A.1 (p. 387)](https://legacy.sba.gov/sites/default/files/2026-10/SOP%2050%2010%208.1%20Technical%20Policy%20Updates%20effective%20%2010.1.2026.docx)
- [SBA Policy Notice 5000-879058 (effective July 4, 2026)](https://legacy.sba.gov/document/policy-notice-5000-879058-coordination-7a-504-maximum-loan-limits)