Revenue is not repayment ability
How much SBA loan can your business revenue support?
There is no honest SBA loan-size table based on revenue alone. Two companies with the same sales can support very different debt because margins, existing payments, owner expenses, working-capital needs, and loan terms are different.
An illustrative revenue-to-loan model
The table assumes 10% of revenue remains available for debt service, a planning debt-service coverage ratio of 1.25, a 10-year term, and a 10% annual interest rate. These are examples, not SBA rules, lender terms, or qualification estimates.
| Annual revenue | Cash flow at 10% | Debt service at 1.25 coverage | Illustrative loan amount |
|---|---|---|---|
| $500,000 | $50,000 | $40,000 per year | $252,237 |
| $1,000,000 | $100,000 | $80,000 per year | $504,474 |
| $2,000,000 | $200,000 | $160,000 per year | $1,008,949 |
| $5,000,000 | $500,000 | $400,000 per year | $2,522,372 |
Why your real number can be much lower or higher
- Margin: a 5% cash-flow margin supports roughly half the debt of a 10% margin, all else equal.
- Existing debt: current loan and lease payments consume repayment capacity.
- Term: a longer amortization lowers the required monthly payment but can increase total interest.
- Purpose and collateral: real estate, equipment, working capital, and acquisitions can be structured differently.
- Volatility: customer concentration, seasonality, and declining sales can reduce what a lender is comfortable approving.
The better way to estimate your range
- Start with tax-return income and operating cash flow, not deposits alone.
- Add back only expenses a lender can reasonably verify as nonrecurring or noncash.
- Subtract existing annual debt payments.
- Choose a conservative coverage cushion.
- Model the payment using the proposed rate and amortization.
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- SBA SOP 50 10 lender policy
- SBA 7(a) and 504 FOIA data dictionary, which does not include borrower revenue
Not a lender or broker of record. The calculations are illustrations only and are not an offer, rate quote, underwriting model, or indication that a business qualifies. Educational only. Not financial, legal, or tax advice.