{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/can-personal-funds-borrowed-from-a-credit-union-against-personal-assets-count-towards-my-e","api_url":"https://dealroom.so/api/public/questions/can-personal-funds-borrowed-from-a-credit-union-against-personal-assets-count-towards-my-e","question":"Can personal funds borrowed from a credit union against personal assets count towards my equity injection?","topic":"Down payment & equity injection","audience":"borrower","bot_mode":"buyer","short_answer":"Yes, personal funds borrowed against assets not being acquired by the business can potentially count as equity injection, provided the loan is not secured by the business assets or the SBA-financed project.","rule":"Funds borrowed from a third party, including a personal loan from a credit union, can qualify as an equity injection if they are truly at risk in the business. This means the loan must not be repaid from the cash flow of the business being acquired, nor secured by any of the business assets or the project assets of the SBA loan. The borrower's personal assets (like a home equity loan on a personal residence) that are not part of the business acquisition can be used as collateral.","example":"You secure a $50,000 personal loan from a credit union, collateralized by equity in your primary residence (not acquired by the business). These funds can be injected as cash equity into your business acquisition.","what_lenders_check":"Lenders must verify that such personal loans are not secured by business assets or repaid from the business's cash flow, ensuring the equity is truly 'at risk'. They will review the terms of the personal loan carefully.","required_facts":["Source of funds","Personal loan terms","Collateral for personal loan","Repayment source","Assets acquired by business"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","13 CFR Part 120 - Business Loans","7(a) Loan Program Terms, Conditions, and Eligibility"],"official_sources":[{"title":"SOP 50 10 - Lender and Development Company Loan Programs","url":"https://www.sba.gov/sites/default/files/2025-05/SOP%2050%2010%208%20Technical%20Updates%20effective%206.1.2025.docx"},{"title":"13 CFR Part 120 - Business Loans","url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120"},{"title":"7(a) Loan Program Terms, Conditions, and Eligibility","url":"https://www.sba.gov/partners/lenders/7a-loan-program/terms-conditions-eligibility"}],"related_questions":[{"question":"Can I use retirement funds from a 401(k) as equity injection for a $750,000 business purchase?","url":"https://dealroom.so/sba-7a/questions/can-i-use-retirement-funds-from-a-401-k-as-equity-injection-for-a-750-000-business-purchas"},{"question":"Can funds from a home equity line of credit (HELOC) be used as my equity injection for a business acquisition?","url":"https://dealroom.so/sba-7a/questions/can-funds-from-a-home-equity-line-of-credit-heloc-be-used-as-my-equity-injection-for-a-bus"},{"question":"Is it possible to use a second mortgage on my personal residence as an equity injection for a $1.5 million business acquisition?","url":"https://dealroom.so/sba-7a/questions/is-it-possible-to-use-a-second-mortgage-on-my-personal-residence-as-an-equity-injection-fo"},{"question":"How much cash must I personally inject for an SBA 7(a) business acquisition?","url":"https://dealroom.so/sba-7a/questions/how-much-cash-must-i-personally-inject-for-an-sba-7-a-business-acquisition"},{"question":"What are the acceptable sources for my cash equity injection beyond personal savings?","url":"https://dealroom.so/sba-7a/questions/what-are-the-acceptable-sources-for-my-cash-equity-injection-beyond-personal-savings"},{"question":"What is the SBA's minimum required equity injection percentage for a business acquisition?","url":"https://dealroom.so/sba-7a/questions/what-is-the-sba-s-minimum-required-equity-injection-percentage-for-a-business-acquisition"}],"related_terms":[{"term":"Borrowed funds","url":"https://dealroom.so/glossary/borrowed-funds"},{"term":"Credit union","url":"https://dealroom.so/glossary/credit-union"},{"term":"Borrowed Equity","url":"https://dealroom.so/glossary/borrowed-equity"},{"term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"term":"Undisclosed Borrowed Equity","url":"https://dealroom.so/glossary/undisclosed-borrowed-equity"},{"term":"Personal Assets","url":"https://dealroom.so/glossary/personal-assets"}],"related_tools":[{"name":"SBA 7(a) payment & fee calculator","url":"https://dealroom.so/sba-7a/calculator"},{"name":"Find an active SBA 7(a) lender","url":"https://dealroom.so/lenders"}],"data_freshness":{"last_reviewed":"2026-06-14","sba_rule_sources_checked_through":"2026-06-14"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-7a/questions/can-personal-funds-borrowed-from-a-credit-union-against-personal-assets-count-towards-my-e","source_type":"DealRoom Q&A"},"caveats":["Grounded in the current SBA rulebook; verify against official sources before relying on it for a live deal.","Not legal, tax, or financial advice and not an approval decision."]}