The Complete Guide to Pari Passu Lenders: How GoSBA Helps You Secure Multi-Layered SBA Financing

When entrepreneurs outgrow the $5 million SBA 7(a) loan cap, the challenge is clear: how do you finance a larger acquisition without raising costly equity?

The solution for many buyers lies in pari passu lending—a financing structure where two lenders share equal priority in repayment and collateral. At GoSBA Loans, we’ve made pari passu SBA loans one of our specialties, helping borrowers close multi-million-dollar transactions that would otherwise fall through.

This guide explains what pari passu lending is, why it matters, which lenders participate, and how GoSBA helps clients successfully execute these complex deals. If you’re searching for pari passu lenders or exploring how to fund an acquisition above $5 million, you’ll find the answers here.

What Are Pari Passu Lenders?

The phrase pari passu means “on equal footing.” In lending, it refers to two or more lenders sharing the same rights when it comes to repayment and collateral.

In SBA financing, this typically takes the form of a $5 million SBA 7(a) loan paired with a conventional term loan of $1–5 million or more. Both lenders occupy equal priority positions, unlike mezzanine or subordinated debt, which sits behind senior lenders.

This structure creates the opportunity to borrow far more than the SBA cap while still benefiting from SBA terms and guarantees. It’s especially powerful for acquisitions, roll-ups, and capital-intensive expansions.

Why Pari Passu Lending Matters for SBA Borrowers

The SBA’s $5 million cap is often too restrictive for modern acquisition sizes. Industries such as healthcare, logistics, HVAC, and multi-unit franchising frequently involve transactions in the $6–$12 million range. Without a pari passu partner, borrowers either have to walk away or raise expensive outside equity.

Pari passu lenders solve this problem by stepping in alongside the SBA loan. The structure allows borrowers to expand their capital stack while keeping equity injections relatively modest. In many deals, seller notes can be layered in as standby equity, further reducing the buyer’s cash requirement.

Another advantage is the alignment of lender interests. Because both lenders share equal footing, they are motivated to work together and manage risk collaboratively. The result is a deal that is more stable for the lenders and more achievable for the borrower.

Finally, the blended cost of capital in a pari passu loan is far more attractive than alternatives like mezzanine debt or private equity dilution. While the SBA side of the deal carries Prime-based rates and the conventional loan may be slightly higher, the combination still yields a financing package that is both competitive and flexible.

When to Use Pari Passu SBA Loans

Borrowers typically turn to pari passu lending when they are:

• Acquiring a business priced above the SBA’s $5 million cap
• Combining real estate with an operating business in a single transaction
• Funding a roll-up of multiple companies or units under one umbrella
• Expanding a franchise system with several buildouts at once

For example, an $8 million HVAC acquisition might be structured as a $5 million SBA loan paired with a $2.5 million pari passu term loan and a modest seller note. Similarly, a $6 million assisted living facility purchase could be funded with $4.5 million in SBA financing and $1.5 million in pari passu mortgage debt.

In each case, pari passu lending bridges the gap between SBA limits and actual deal size.

Which Lenders Offer Pari Passu SBA Loans?

Not every SBA lender is willing or able to structure pari passu transactions. Only a subset of banks and specialized lenders actively engage in this space.

National players such as Huntington National Bank, TD Bank, and First Bank of the Lake have demonstrated the ability to handle complex pari passu structures. Regional institutions like Live Oak Bank and Celtic Bank also participate, especially for acquisition-heavy and cash-flow-focused industries.

Beyond traditional banks, some fintech and non-bank lenders have experimented with pari passu structures, although they are less common in SBA-specific deals. The real differentiator is not just finding a lender who can do pari passu—it’s finding one who will do it for your industry, deal size, and borrower profile.

That’s where GoSBA comes in. With relationships across more than 30 SBA lenders and conventional partners, we know which institutions are actively closing pari passu loans today and which ones to avoid.

Case Studies: Real Deals Closed with Pari Passu Structures

To illustrate how powerful this financing model can be, here are a few recent examples:

• Trucking Acquisition – $10M Total Funding
  A borrower closed a $10 million deal using a $5 million SBA loan, a $2.5 million pari passu term loan, and a $1 million standby seller note. Instead of raising millions in equity, the deal closed with just a modest buyer contribution.
• E-Commerce Roll-Up – $10.8M Acquisition
  This transaction involved a $4.665 million SBA loan, $1.71 million from a pari passu lender, and a $2 million seller note. Despite the lack of hard assets, the pari passu structure enabled financing that a traditional SBA-only loan would not have supported.
• HVAC Business – $6.8M Financing
  GoSBA facilitated the first pari passu SBA closing of 2025: a $5 million SBA loan paired with $1.8 million in conventional pari passu financing. The deal closed in just 75 days after outreach to more than ten lenders.

These examples highlight why pari passu lenders are critical for borrowers tackling larger or more complex acquisitions.

How GoSBA Structures Pari Passu SBA Loans

Securing pari passu financing requires coordination across multiple lenders, alignment of amortization schedules, and careful attention to SBA guidelines. At GoSBA, we guide borrowers through every step:

1. Pre-qualification and capital stack planning – We evaluate liquidity, collateral, DSCR, and deal structure to determine feasibility.
2. Lender outreach – We approach SBA and conventional pari passu lenders simultaneously, ensuring competition and better terms.
3. Negotiation and alignment – We work to synchronize amortization schedules and repayment terms, creating a smooth blended debt profile.
4. Closing coordination – We manage both underwriting processes, ensuring the SBA and conventional sides move forward together.
5. Post-closing support – We provide ongoing guidance to ensure compliance, loan servicing, and potential refinancing or expansion.

This end-to-end process is what allows us to consistently deliver results in an area many brokers won’t touch.

Key Considerations for Borrowers

Pari passu lending introduces a few technical elements borrowers should be aware of. Debt Service Coverage Ratio (DSCR) is still the anchor metric, with most lenders requiring at least 1.25x coverage post-close. Seller notes may need to be placed on standby to count as equity by SBA standards. And while rates on the conventional portion may differ, aligning amortization across both sides is essential for long-term cash flow management.

The bottom line is that these deals are highly achievable when structured correctly—but nearly impossible if attempted without the right network and expertise.

Why GoSBA Is the Leader in Pari Passu SBA Loans

At GoSBA Loans, we’ve established ourselves as a national leader in structuring pari passu SBA transactions. Our track record includes closings across trucking, HVAC, e-commerce, healthcare, and multi-unit franchises. We understand not just which lenders are active, but also how to structure the deal to satisfy underwriting on both sides.

Borrowers choose GoSBA because we:

• Have the largest active network of SBA and pari passu lenders in the country
• Consistently close transactions faster than industry averages
• Specialize in lowering borrower equity injections through creative structuring
• Focus exclusively on acquisition and growth financing, rather than spreading across unrelated loan types

When you search for pari passu lenders, you’ll find plenty of information. When you work with GoSBA, you’ll close a deal.

If you are considering a business acquisition or expansion above the SBA limit, it’s time to explore pari passu financing. At GoSBA Loans, we don’t just broker loans—we engineer capital stacks that make the impossible possible.

👉 Contact GoSBA today to learn how our pari passu lender network can fund your next big acquisition.