SBA Loans for RV Parks: Financing an Existing Park Purchase
Buyers of established RV parks and campgrounds frequently ask whether SBA-backed financing can help them complete a purchase. SBA loans for RV parks may be an option in some situations, because SBA programs can finance business acquisitions and owner-occupied commercial real estate with repayment terms that may be longer than some conventional alternatives. Whether a particular park and buyer qualify, however, depends on how the park operates, the use of proceeds, program rules and lender review.
This article is general information for buyers of existing, operating RV parks and campgrounds. It does not address developing a new park or financing equipment on its own. SBA program rules change, and eligibility is determined by participating lenders and the SBA. Every loan is subject to lender approval. Nothing here is a commitment to lend or legal, tax or financial advice.
SBA 7(a) Loans
The SBA 7(a) program can be used for business acquisitions, including transactions that combine an operating business with real estate. Proceeds may also cover working capital and certain closing costs, subject to program rules. Our page on SBA 7(a) business real estate loans explains the program in more detail.
SBA 504 Loans
The SBA 504 program is designed for owner-occupied commercial real estate and certain long-term fixed assets. It may fit some park purchases where the real estate is the main component, depending on the structure. See our page on SBA 504 business real estate loans.
Active Business or Passive Real Estate?
SBA programs are intended for operating businesses, and program rules generally exclude passive real estate investment. An RV park that serves transient and seasonal guests with an office, reservations, guest services and amenities may present differently from a property that functions mainly as long-term rental space. How a particular park is viewed depends on its operations, its site mix, how revenue is earned, program rules and lender review. Our article on RV park site mix explains why this distinction matters.
What Lenders Will Review
- Documented cash flow from tax returns and financial statements, reviewed over several years
- Monthly results and how the park handles slower seasons
- The buyer’s experience in hospitality, property management or business operations
- The buyer’s equity injection and its source
- Personal credit and financial statements
- An appraisal, environmental review and property condition
- Permits, zoning and any long-term occupant arrangements
Our article on RV park loan requirements describes these items in more detail.
Seller Notes With SBA Financing
Some SBA-financed purchases include a seller note, which may be able to count toward the buyer’s equity in certain circumstances under program rules. Seller notes are typically subordinate to the senior loan and may have payment restrictions. See our article on RV park seller financing.
Planning Payments
Buyers can estimate possible payments with our SBA loan calculator. Actual rates, terms and amounts depend on the lender, the program and the transaction, so a calculator is a planning tool rather than a quote.
When SBA Financing May Not Fit
Some transactions may be better suited to conventional financing, for example when a buyer has significant equity, when the property operates mainly as long-term rental real estate or when the deal falls outside program rules. A financing advisor can help compare options.
US Professional Funding helps buyers evaluate SBA and conventional options to finance the acquisition of existing, operating RV parks and campgrounds. Learn more about our RV park and campground acquisition financing.
