{"ok":true,"canonical_url":"https://dealroom.so/glossary/equity","api_url":"https://dealroom.so/api/public/glossary/equity","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"equity","term":"Equity","group":"Your money in the deal","definition":"The ownership interest in a business, representing the value remaining after all liabilities are paid. For a buyer, it's the cash or assets directly invested in the deal.","what_it_means":"Your equity injection is the portion of the purchase price you contribute directly, demonstrating your commitment and reducing the loan-to-value ratio. The SBA requires a minimum equity injection, typically 10-15% of the total project cost. Lenders verify the source and seasoning of these funds to ensure they are genuinely \"unencumbered\" and not disguised debt.","url":"https://dealroom.so/glossary/equity","official_sources":[{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"},{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"}],"related":[{"slug":"equity-injection","term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"slug":"risk-capital","term":"Risk Capital","url":"https://dealroom.so/glossary/risk-capital"},{"slug":"total-project-costs","term":"Total project costs","url":"https://dealroom.so/glossary/total-project-costs"},{"slug":"unencumbered","term":"Unencumbered","url":"https://dealroom.so/glossary/unencumbered"}],"related_questions":[{"question":"Can funds from a home equity line of credit be used for my equity injection?","url":"https://dealroom.so/sba-7a/questions/can-funds-from-a-home-equity-line-of-credit-be-used-for-my-equity-injection"},{"question":"Can I use funds from a home equity line of credit for my 10% equity injection?","url":"https://dealroom.so/sba-7a/questions/can-i-use-funds-from-a-home-equity-line-of-credit-for-my-10-equity-injection"},{"question":"How is 'sweat equity' or future services treated for an SBA 7(a) loan equity injection?","url":"https://dealroom.so/sba-7a/questions/how-is-sweat-equity-or-future-services-treated-for-an-sba-7-a-loan-equity-injection"},{"question":"Can sweat equity or future services I provide to the business count towards the required equity injection?","url":"https://dealroom.so/sba-7a/questions/can-sweat-equity-or-future-services-i-provide-to-the-business-count-towards-the-required-e"},{"question":"Can funds from a private equity firm count as equity injection for an SBA 7(a) loan?","url":"https://dealroom.so/sba-7a/questions/can-funds-from-a-private-equity-firm-count-as-equity-injection-for-an-sba-7-a-loan"},{"question":"Can a borrower's sweat equity count towards the required equity injection for a 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/can-a-borrower-s-sweat-equity-count-towards-the-required-equity-injection-for-a-7-a-loan"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Equity","url":"https://dealroom.so/glossary/equity","source_type":"DealRoom Data"}}