Max Purchase Price Calculator

Most first-time buyers anchor on the broker's asking price and then try to talk it down. That's backwards. The asking price is the seller's opening number, and it tells you nothing about what the deal can actually carry. What matters is the math: given the cash flow, your down payment, and today's rates, what's the most you can pay and still sleep at night?

This calculator inverts the usual flow. Instead of plugging in a price and checking the DSCR, you pick the DSCR you're comfortable with and it hands you the price. If your ceiling lands below the ask, you know exactly how far apart you and the seller are before you waste a call. If it lands above, you've got room, and you can decide how much of that room you actually want to use.

The 1.25x DSCR Gate, and Why Lenders Care

DSCR is the business's annual cash flow divided by its annual debt payments. SBA lenders set a hard floor of 1.25x on acquisition loans, which means the business has to throw off at least $1.25 of cash for every $1.00 of debt service. Plenty of lenders want more than the minimum. It's common to see underwriters prefer 1.35x to 1.50x so there's a buffer for a slow quarter or a customer that walks. Set your target a notch above the floor and your max price drops, but your deal gets a lot more durable.

The current rate environment matters here. As of June 2026, Prime sits at 6.75%, and a typical SBA 7(a) acquisition loan over $350K prices around 9.5% to 9.75%. The standard term is 10 years with 10% to 15% down. Higher rates mean a bigger annual payment for the same loan, which pushes your max price down. That's not pessimism, it's just the cost of money showing up in your ceiling.

How Down Payment, Seller Notes, and Multiple Discipline Move the Ceiling

Every dollar that isn't SBA debt is a dollar that doesn't amortize at 9.5% over 10 years, so structure changes your ceiling fast. A bigger down payment shrinks the SBA loan and lifts the price you can support, but it also drains your cash. A seller note does similar work, especially if it's on standby for the first couple of years, because it defers payments while you stabilize the business. Slide the inputs and watch the max price react.

One last guardrail: watch the implied multiple. Just because the financing lets you pay 4.5x SDE doesn't mean you should. Most healthy SMB acquisitions trade between 2.5x and 4.0x, and a number much higher than that usually means you're leaning on cheap structure to justify an expensive price. The ceiling is what you can pay. Discipline is about what you should.