• We ran every active listing we track through the test a lender will run on your deal. Each dot is 1% of listings.
• The question: at the asking price, with a standard SBA loan, can this business make its loan payment and still pay you $100K?
• About a third cannot cover the payment at all. Half clear the 1.25x line lenders look for. The rest sit in between.
• That is not a reason to quit. It is the reason to do this math in your head before you email a broker. Try the size bands below.

Searcher OS listing data, Sep 21, 2026. 29,874 active listings reporting both asking price and cash flow. Assumes 10% down, 10 years at 10.5%, a $100K owner salary, and broker-stated cash flow taken at face value.

• There aren't a lot of standards around what gets published as cash flow. Revenue is probably fairly reliable. Cash flow is a different story.
• There is EBITDA, there is SDE, and there are add-backs, which can get really creative. Nobody defines which add-backs are justified and which are not.
• So the same business can honestly show three different numbers, depending on who is counting.
• Searcher OS does its best at classifying what a listing reports. But at the end of the day you will have to talk to a lender to see what qualifies for a loan, because DSCR is what matters.

• Start with the tax return. This business shows $140K of profit. That is real, and it is not the whole picture.
• Owners run small companies to keep taxable income low. First, they pay themselves a salary. That money went to the owner.
• They run a truck, a phone, health insurance and some travel through the business. Also the owner.
• Depreciation is a deduction that never left the bank account. Interest is on his loan, not yours. A one-time legal bill should not repeat. Add it all back and one working owner really gets $400K.

• SDE, seller's discretionary earnings, is everything one working owner takes out of the business.
• EBITDA is the same business measured differently: it assumes you are already paying a manager to run it. Take out a manager's salary and the number drops.
• Smaller businesses, under roughly $1M of cash flow, are quoted in SDE. Larger ones are quoted in EBITDA.
• Never compare an SDE multiple to an EBITDA multiple. 3x SDE and 3x EBITDA are very different prices.

• Asking price divided by SDE is the multiple. $1.2M on $400K of SDE is 3.0x. You are paying three years of the owner's earnings up front.
• Bigger businesses get higher multiples because they are less risky. A business that depends on its owner sits at the bottom.
• Add a team and the risk drops. Add systems, management and a spread of customers and buyers will pay 4x or more.
• These are asks. In about 30 closed deals I tracked, almost everything cleared between 2.3x and 3.7x, and one $4M ask closed at $3.2M. Now drag the price below.

• An SBA 7(a) acquisition loan runs 10 years, and the rate floats with prime. Recent loans have priced near 9.75%. This course uses 10.5% to leave you some room.
• Borrow $1M and you make 120 monthly payments of about $13,500.
• Early on, most of each payment is interest. The balance falls slowly at first, then faster.
• The number to remember: every $1M you borrow costs about $162K a year. Halve the loan, halve the payment.

Level monthly payments at 10.5% over 10 years, September 2026. SBA rates float with prime, so your payment can move.

• Now put it together. The business throws off $400K. About $175K a year goes to the bank and $100K goes to you.
• Lenders want the business to earn at least 1.25 times its loan payment after your salary comes out. That ratio is DSCR, debt service coverage ratio.
• This deal: $400K minus your $100K, divided by $175K, is 1.72x. Comfortably over the line, with $125K of cushion for a bad year.
• Now use the switch below. If $90K of add-backs do not survive diligence, same business, same price, and the bank says no.

• Back to the card from Unit 1: buy at 3x and earn a 33% unlevered return.
• The arithmetic is right. $400K on $1.2M is 33%. But that is before you are paid for running the place.
• Pay yourself $100K for a full-time job and the return on the business is 25%. Then the bank takes $175K.
• What is left is $125K. But you only put in $120K of your own cash. That is a strong return, as long as the $400K is real and you can run it. The pitch is not wrong. It is incomplete.