{"ok":true,"canonical_url":"https://dealroom.so/glossary/overvaluation","api_url":"https://dealroom.so/api/public/glossary/overvaluation","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":"overvaluation","term":"Overvaluation","group":"Reading the business","definition":"When an asset or business is priced higher than its true fair market value. This is a major risk for a buyer and a red flag for lenders.","what_it_means":"A third-party appraisal helps prevent overvaluation by providing an objective assessment. If an appraisal comes in significantly lower than the purchase price, you'll need to renegotiate with the seller or increase your equity injection to cover the difference. Lenders won't fund overvaluation.","url":"https://dealroom.so/glossary/overvaluation","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":"third-party-appraisal","term":"Third-party appraisal","url":"https://dealroom.so/glossary/third-party-appraisal"},{"slug":"fair-market-value","term":"Fair market value","url":"https://dealroom.so/glossary/fair-market-value"},{"slug":"business-valuation","term":"Business valuation","url":"https://dealroom.so/glossary/business-valuation"},{"slug":"equity-injection","term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"}],"related_questions":[]},"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 — Overvaluation","url":"https://dealroom.so/glossary/overvaluation","source_type":"DealRoom Data"}}