{"ok":true,"canonical_url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-an-equity-injection-from-a-gift-from-a-non-immediate-family-membe","api_url":"https://dealroom.so/api/public/questions/how-does-a-lender-verify-an-equity-injection-from-a-gift-from-a-non-immediate-family-membe","question":"How does a lender verify an equity injection from a gift from a non-immediate family member?","topic":"Equity injection verification","audience":"lender","bot_mode":"lender","short_answer":"For a gift from a non-immediate family member, the lender must obtain a gift letter, bank statements from both the donor and borrower showing the transfer, and proof the donor has sufficient funds, ensuring the gift is truly unencumbered.","rule":"SBA allows gifts as equity injection, provided they are genuine and unencumbered. For gifts from non-immediate family (or any third party), lenders must conduct enhanced due diligence. This includes a signed gift letter stating no repayment is expected, documentation of the donor's source of funds, and clear bank statements showing the transfer from the donor to the borrower's account, ensuring the funds are clean and irrevocably gifted.","example":"A borrower receives a $25,000 gift from an aunt for equity injection. The lender requests a gift letter from the aunt, her bank statement showing the $25,000 withdrawal, and the borrower's bank statement showing the $25,000 deposit, verifying the source and transfer of the unencumbered funds.","what_lenders_check":"Lenders are concerned about hidden repayment obligations or the gift actually being a loan that would undermine the borrower's equity. Thorough documentation is essential to confirm the gift's bona fide nature and the donor's capacity to give.","required_facts":["Gift letter","Donor's bank statements","Borrower's bank statements","Proof of transfer","Unencumbered funds"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","13 CFR Part 120 - Business Loans"],"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"}],"related_questions":[{"question":"What documentation verifies funds for equity injection transferred from a personal investment account?","url":"https://dealroom.so/for-lenders/questions/what-documentation-verifies-funds-for-equity-injection-transferred-from-a-personal-investm"},{"question":"How does a lender verify equity injection funds that are a cash gift from a non-family third party?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-equity-injection-funds-that-are-a-cash-gift-from-a-non-family-thi"},{"question":"Can a borrower's investment in a certificate of deposit (CD) count towards the required equity injection?","url":"https://dealroom.so/for-lenders/questions/can-a-borrower-s-investment-in-a-certificate-of-deposit-cd-count-towards-the-required-equi"},{"question":"What specific documentation is required to verify equity injection funds originating from a borrower's existing business assets, such as equipment or inventory?","url":"https://dealroom.so/for-lenders/questions/what-specific-documentation-is-required-to-verify-equity-injection-funds-originating-from-"},{"question":"How does a lender verify the source of gifted equity injection funds when the donor is a foreign national?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-the-source-of-gifted-equity-injection-funds-when-the-donor-is-a-f"},{"question":"How does a lender verify equity injection funds that are sourced from a personal line of credit secured by non-personal real estate?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-equity-injection-funds-that-are-sourced-from-a-personal-line-of-c"}],"related_terms":[{"term":"Immediate Family Members","url":"https://dealroom.so/glossary/immediate-family-members"},{"term":"Non-Cash Equity Injection","url":"https://dealroom.so/glossary/non-cash-equity-injection"},{"term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"term":"Minimum Equity Injection","url":"https://dealroom.so/glossary/minimum-equity-injection"},{"term":"Tangible Equity Injection","url":"https://dealroom.so/glossary/tangible-equity-injection"},{"term":"Hidden Equity Injection","url":"https://dealroom.so/glossary/hidden-equity-injection"}],"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":"2026-06-13","sba_rule_sources_checked_through":"2026-06-13"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-verify-an-equity-injection-from-a-gift-from-a-non-immediate-family-membe","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."]}