What does an SBA business plan have to show your lender?
Repayment from cash flow (the SOP's primary source of repayment), equity and collateral, for your lender's credit memorandum. SBA says SOP 50 10 8.1 applies to applications received by SBA on or after 1 October 2026, so ask your lender which edition governs your file.
| What the Standard 7(a) memorandum must document (Section B, Ch. 1) | What a plan and model have to supply |
|---|
| The business, its history and management depth, and the lender's rationale, including competition | Company, management and market sections |
| Repayment: coverage "must be equal to or greater than 1.15 on a historical and/or projected cash flow basis and 1:1 on a global basis" | An EBITDA bridge with each add-back justified, a complete debt schedule and a global schedule |
| Start-ups, new businesses and other applications based on projections: projections and assumptions that reflect a "debt service coverage equal to or greater than 1.15 within 2 years" from funding or the end of construction | Projections reaching the two-year point, with written assumptions for revenue growth, expense reductions and industry trends |
| A pro forma balance sheet, ratios and working capital adequacy over at least the next 12 months | A pro forma balance sheet at closing, the ratios and a 12-month cash flow |
| Equity, discussed in detail: the lender, or SBA on a non-delegated loan, decides whether "the equity position, any required equity contribution, and the pro forma debt-to-worth are acceptable" | Sources and uses reconciled to total project cost |
| Collateral: an "Assessment of collateral adequacy adjusted in accordance with Appendix 19" | A fixed asset schedule with prior liens |
Scope is set by package: Standard carries the full lender financial model and repayment-ability analysis.
What the numbers cost. Take a $600,000 ten-year fully amortizing loan at an assumed 10.0 percent (an arithmetic input, not a rate quote) with no other business debt: annual debt service is 12 x $7,929.04 = $95,148.48. At 1.15 that needs $109,420.75 of cash flow (EBITDA before any lender adjustments). The 1.25:1 of an Initial Acquisition needs $118,935.60 of EBITDA, $9,514.85 more. It is tested on the acquired business's past results, so we build a purchase plan from the seller's historical financials (SBA loan to buy a business). On a Standard 7(a) or 7(a) Small loan, a start-up injects at least 10 percent of total project costs, not of the loan: $35,000 on a $350,000 project, where 10 percent of the $315,000 loan would be $31,500.
Can you pay someone to write your SBA business plan?
Yes, and SOP 50 10 8.1 sets rules for it. Under Section A, Chapter 4, "the SBA does not require the use of an Agent for packaging or referring a loan application". On a 7(a) loan, an Applicant may pay an Agent for packaging, which includes "preparing a business plan", on three conditions: "compensation is reasonable and customary for those services; the compensation complies with SBA Loan Program Requirements; and the compensation is not contingent on the loan being approved or closed".
- Fee basis. Fees may be "based on an hourly rate or on a percentage of the loan amount". In either case, "all fees over $2,500 must be supported by documenting the service performed"; for an hourly fee, "The hourly rate and time spent on each service must be documented". The same paragraph caps percentage fees.
- Not allowed. SBA does not allow "A standard or flat fee charged to all Applicants" or "Contingency fees (fees paid only if the loan is approved or closed)".
- SBA Form 159. When an Agent is paid, the form is "signed by the Applicant, the Agent, and the 7(a) Lender", and if "the aggregate compensation for all fees provided by the same Agent exceeds $2,500", "an itemization of the compensation received and supporting documentation must be attached to the Form 159".
- 504 loans. The 504 paragraphs of the same chapter repeat the fee basis and the prohibited charges; there the fees "must be reasonable and customary for the services actually performed", the form is "signed by the Applicant, the Agent, and the CDC", and above $2,500 "the compensation must be itemized".
What it costs you. On a Standard 7(a) or 7(a) Small loan, and on a 7(a) business purchase, Section B, Chapters 1 and 2 and Appendix 15 each say: "Expenses related to education, advisory services, or fees paid by the Applicant to an Agent are not eligible prepaid expenses and are not considered equity." So leave a plan writer's fee, ours included, out of the $35,000 start-up injection above.
Our fee is fixed in advance and payable whether or not the loan is approved; before you engage us, ask your lender whether it treats our work on your plan as an Agent's packaging service on your loan, because if it does these fee and Form 159 rules apply to it.
Freelancer, agency or software: which fits you?
Pick the route by who will build and check the numbers; on every route, ask for a working spreadsheet.
| Route | Fits you if | Also check |
|---|
| Marketplace freelancer | You have a clear brief and can check the numbers yourself | What the scope and revisions cover |
| Specialist firm, like us | You want a fixed price, a written scope and, on Standard, the full lender model | What each tier includes |
| Plan software or a template, such as our free business plan template | You will write and model it yourself; SBA's plan guide points to "free business counseling" | Whether it covers your lender's credit memorandum items |
Whoever you pay, ask your lender about the Agent fee and Form 159 rules above.
When is this the wrong thing to buy?
- You have not spoken to a lender yet. Get a bank or CDC to indicate what they would lend first; it changes the document.
- The gap is cash flow or equity. A plan cannot stand in for either. Without reasonable assurance of repayment from cash flow, the Standard 7(a), 7(a) Small and SBA Express credit standards say "the loan request must be declined, regardless of the collateral available or outside sources of repayment". Collateral: see SBA collateral requirements.
- Your lender asked for a feasibility study. Different document, different standard: an independent opinion allowed to conclude the project does not work. See our Feasibility Study Services and SBA feasibility study requirements.
Need a different document?
- Raising equity or a non-SBA loan? Business Plan Writing Services: $1,000, $1,800 or $2,800.
- Only need the numbers? If the bank wants a model it can interrogate: Financial Modeling Services, $750, $1,250 or $1,950.
- Pitching investors? Pitch Deck Services: $1,950, $2,950 or $3,950.
- Buying or selling a business? Exit and acquisition documents, including an acquisition business plan built to Appendix 15, from $1,800.
SBA requirements we have verified
How we verified this
Sources as of 30 October 2026: every quotation was checked against raw source text retrieved or re-checked that day.
- SBA SOP 50 10 8.1 with Technical Policy Updates, effective 1 October 2026: the Word file on SBA's SOP 50 10 page, last updated 7 October 2026, searched for the words business plan (six occurrences) and for a five-year projection requirement (none). Paying for a plan: Section A, Chapter 4 (Ethics, Fees, and Agents), the 7(a) Loan Program and Use of Agents and 504 Loan Program Fees and Use of Agents paragraphs; Agent fees as equity: Section B, Chapters 1 and 2, Source of Equity Injection, and Appendix 15, Source of Equity Injections.
- SBA Information Notice 5000-882227, published 25 September 2026, for the applications SOP 50 10 8.1 applies to.
- 13 CFR 120.150 (annual edition, current text), which states no coverage ratio and no equity percentage: the coverage floors and the 7(a) start-up 10 percent are SOP policy. 13 CFR 120.910 (annual edition, current text) for the 504 contribution.
- SBA, Plan your business (sba.gov), re-checked 30 October 2026: its Fund your business section for the five-year projections, and the free counseling link.
Not verified, so left out: how often lenders ask for a plan, lender floors above the SOP's, approval rates, and whether a given lender treats a given plan writer as an Agent.
