Can an SBA loan be used as a down payment on a residential mortgage?

Aulede25 asked:


Here is the scenario, I am considering purchasing a home based day care for $680k. the day care is $180K and the seller will carry the note. The home is the other $500K. Can I use an SBA loan for $100K to use as a 20% down payment on a residential mortgage. Then I could put 10-20% ($10-$20K) down and purchase the entire package?

Tim

Tags: 20k, 500k, Purchasing A Home

This entry was posted on Thursday, July 23rd, 2009 at 10:31 pm and is filed under Mortgage Loans. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

3 Responses to “Can an SBA loan be used as a down payment on a residential mortgage?”

1. AJ Says:
   July 25th, 2009 at 2:45 am

   Jeffery

   I don’t know whether you can or not, but if you can and your business goes under, your business’s creditors can seize the home.

2. Jim Says:
   July 27th, 2009 at 8:22 pm

   Renee

   Generally not, you would be pressed to why you aren’t renting a small retail or warehouse shop instead.
   They can be very strict, and if it doesn’t pass the business purchase test, ie: is the purchase 100% for business?
   then it probably wouldn’t be valid.

   However, it never hurts to call them and present your case!

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   July 31st, 2009 at 8:21 am

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