{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/can-the-fair-market-value-of-real-estate-i-already-own-not-part-of-the-acquired-business-c","api_url":"https://dealroom.so/api/public/questions/can-the-fair-market-value-of-real-estate-i-already-own-not-part-of-the-acquired-business-c","question":"Can the fair market value of real estate I already own (not part of the acquired business) count towards my equity injection?","topic":"What counts toward the 10%","audience":"borrower","bot_mode":"buyer","short_answer":"Yes, the fair market value of unencumbered personal real estate, not being acquired by the business, can potentially count towards your equity injection if it's contributed to the business or pledged as additional collateral.","rule":"The SBA permits equity injection to come from cash or certain unencumbered tangible assets. If you contribute personal real estate (e.g., land or a building you own personally, distinct from the acquired business's assets) to the operating company, or use its unencumbered equity value as collateral for a separate loan that funds the injection, it can count. An independent appraisal is required to establish the fair market value of the real estate.","example":"You need a $100,000 equity injection. You own a vacation home with $150,000 in unencumbered equity. If this home's equity is formally pledged to the business or used to secure a personal loan that funds the injection, the appraised value of the contributed equity can count towards your $100,000 injection.","what_lenders_check":"Lenders require a clear valuation (appraisal) of any contributed real estate and documentation showing clear title and absence of other liens. They verify that the equity is truly 'at risk' for the business and not already pledged elsewhere.","required_facts":["Real estate appraisal","Unencumbered equity","Contribution to business","Pledged collateral","Source of funds"],"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 renovation costs for an acquired business premises count towards my required 10% equity injection?","url":"https://dealroom.so/sba-7a/questions/can-renovation-costs-for-an-acquired-business-premises-count-towards-my-required-10-equity"},{"question":"Can the fair market value of equipment I already own and contribute to the acquired business count towards my equity?","url":"https://dealroom.so/sba-7a/questions/can-the-fair-market-value-of-equipment-i-already-own-and-contribute-to-the-acquired-busine"},{"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":"Are pre-closing legal and accounting fees eligible to be counted towards my equity injection?","url":"https://dealroom.so/sba-7a/questions/are-pre-closing-legal-and-accounting-fees-eligible-to-be-counted-towards-my-equity-injecti"},{"question":"Besides cash, what non-cash assets can I contribute to meet the 10% equity injection for an $800,000 acquisition?","url":"https://dealroom.so/sba-7a/questions/besides-cash-what-non-cash-assets-can-i-contribute-to-meet-the-10-equity-injection-for-an-"},{"question":"Can a substantial pre-paid rent deposit on a commercial lease count towards the equity injection for a business acquisition?","url":"https://dealroom.so/sba-7a/questions/can-a-substantial-pre-paid-rent-deposit-on-a-commercial-lease-count-towards-the-equity-inj"}],"related_terms":[{"term":"Fair market value","url":"https://dealroom.so/glossary/fair-market-value"},{"term":"Net fair market value","url":"https://dealroom.so/glossary/net-fair-market-value"},{"term":"Business Fair Market Value","url":"https://dealroom.so/glossary/business-fair-market-value"},{"term":"Lower of cost or fair market value","url":"https://dealroom.so/glossary/lower-of-cost-or-fair-market-value"},{"term":"Market value","url":"https://dealroom.so/glossary/market-value"},{"term":"Real Estate","url":"https://dealroom.so/glossary/real-estate"}],"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-the-fair-market-value-of-real-estate-i-already-own-not-part-of-the-acquired-business-c","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."]}