Tool

A first look at your acquisition's cash flow.

Start with net income. The calculator adds back what a lender adds back, takes out what a lender takes out, tests the result against the new payment, and then tests it again with your household included. Every step is shown. The values below are sample numbers; replace them with yours.

New to this? Read how lenders calculate cash flow first, or just start typing.

1. The deal Purchase price Closing costs and fees Working capital to fund

2. Where the money comes from Your cash in Seller note on full standby Seller note with payments

Seller note rate (%) Seller note term (yrs)

Loan rate (%) Loan term (yrs)

3. The business's earnings (most recent year, from the tax return or financials) Net income + Interest expense old debt that goes away or is replaced + Depreciation + Amortization + One-time or non-recurring items a lender will test these + Rent that goes away if you also buy the building - Maintenance capital spending that is not financed - Owner pay needed from the business a realistic salary for the person running it

4. Your household Other household income per year spouse wages, other sources Household living costs per year Personal debt payments per year mortgage, cars, cards, anything you carry Estimated tax rate (%) one flat rate, for estimating

5. Assumptions (unverified, adjust to what your lender says)

Minimum cash injection (% of project) Standby note cap (% of required injection)

Target coverage (x)

Sources & uses

Purchase price	-
Closing costs and fees	-
Working capital	-
Total project	-

Bank loan	-
Your cash	-
Seller note (standby)	-
Seller note (paying)	-

Coverage

Business coverage-

Global coverage-

Loan payment per month-

Annual debt service on the deal-

Largest loan your numbers could carry at your target-

How it was calculated

Business cash flow
Net income	-
+ Interest, depreciation, amortization	-
+ One-time items and rent that goes away	-
- Maintenance capital spending	-
Cash flow before owner pay	-
- Owner pay needed from the business	-
Business cash available	-
÷ Annual debt service on the deal	-
= Business coverage	-
Global cash flow (adds your household)
Cash flow before owner pay + other income	-
- Estimated taxes	-
- Household living costs	-
Cash available for all debt	-
÷ Deal debt service + personal debt payments	-
= Global coverage	-

A standby seller note is left out of debt service while it is on standby. A paying seller note is included. Real underwriting uses more detail than this.

What if things go a little wrong?

Scenario	Business	Global

▼ marks a result below your target coverage. A deal that only works if nothing goes wrong is a fragile deal; lenders want margin.

Want this as a lender-ready package? Tell us the deal in your own words and we will build the version a bank can work from, with the gaps called out and your options side by side.

Tell us your plan

What this calculator does not model

Taxes. One flat rate applied to cash flow. Real taxes depend on entity type, deductions and interest, and the flat rate here probably overstates them, which makes the household view look worse.
Fees. SBA guaranty fees, packaging, appraisal, legal and other closing costs beyond the single line you enter.
Trend. One year only. Lenders look at several years and the direction of travel.
Collateral, liquidity and credit. Lenders weigh these alongside cash flow. None are modeled.
Seller-note details. Standby terms, interest accrual and how a particular lender counts the note toward your cash.
Your lender's method. Add-backs, owner pay and the rate used for testing differ by lender.

See what a finished version looks like: the sample lender-ready package (hypothetical numbers).

Estimate only. Sample values are hypothetical. This is not an offer, approval or commitment to lend, and the SBA rules and lender policies it models change; the highlighted assumptions are unverified. Excludes guaranty fees, a real tax calculation, collateral and many other real-world items. Nothing you type is sent anywhere. Not legal, tax or financial advice. Precise SBA is not affiliated with the U.S. Small Business Administration.