The average SBA acquisition takes 60–90 days to close after an LOI is executed. Deals that close in 45–55 days typically have one thing in common: the buyer came prepared.
Here are a few ways to avoid unnecessary delays and keep your deal moving.
Get Prequalified Before You're Under LOI
Getting prequalified before you're under LOI can save you a significant amount of time. A lender-issued prequalification letter shows that your personal financials, credit, and liquidity have already been reviewed. Once you submit a deal, the lender can focus on underwriting the business rather than starting with your personal qualifications.
Buyers who wait to submit their personal financial documents until they submit the deal package can add 2–3 weeks to the process.
Prepare Your Documents in Advance
Most SBA lenders require a similar set of personal financial documents, including:
- Personal financial statement (SBA Form 413)
- 3 years of personal tax returns
- Government-issued ID
- Resume or professional bio
- Bank statements (typically 3–6 months)
- Business tax returns if you own other businesses
Have everything organized, up to date, and compiled into a single PDF before submitting your first LOI.
Sending documents one at a time over several weeks can create unnecessary delays, especially when the lender needs a complete package to move forward.
Order the Business Valuation Early
Business valuations typically take 2–4 weeks to complete. Rather than waiting for your lender to request one, start the process during the same week you execute your LOI.
Your lender can recommend approved valuation providers. Working with someone they've used before can also help avoid delays related to report formatting or additional documentation requests.
Respond to Lender Requests Within 24 Hours
Lenders are usually managing several deals at once, so timely communication matters.
When a lender requests additional documents or clarification, a delayed response can affect your closing timeline. Taking five days to respond to a routine request could potentially push your closing date back by two weeks.
Designate one person, whether that's you, your attorney, or your advisor, to manage lender communication. Keeping everything organized through a single point of contact and responding within 24 hours can help prevent unnecessary delays.
Schedule the Appraisal at LOI
If your acquisition includes real estate, the commercial appraisal typically takes 3–5 weeks and must be ordered by the lender.
Ask your lender to order the appraisal as soon as the LOI is executed rather than waiting until the formal loan application is submitted.
Negotiate a Realistic Due Diligence Period
A 30-day due diligence period is rarely enough for an SBA-financed acquisition. Lender underwriting alone generally takes 2–4 weeks after the complete loan package has been submitted.
When negotiating your LOI, aim for a 60–75 day due diligence period with a mutual option to extend if needed.
An overly aggressive timeline often leads to extension requests, which can frustrate sellers and put unnecessary pressure on the transaction. It's better to account for the financing timeline from the beginning.