{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/how-is-existing-equipment-i-own-valued-for-my-equity-injection-into-the-acquired-business","api_url":"https://dealroom.so/api/public/questions/how-is-existing-equipment-i-own-valued-for-my-equity-injection-into-the-acquired-business","question":"How is existing equipment I own valued for my equity injection into the acquired business?","topic":"Equity Injection Components","audience":"borrower","bot_mode":"buyer","short_answer":"Existing equipment you own can be valued for equity injection, but its fair market value must be independently verified by an appraisal or other acceptable method.","rule":"When contributing existing assets like equipment as equity, the SBA requires that their fair market value be established by an independent third-party appraisal, especially if the value is significant. The equipment must be unencumbered and essential to the business operations, demonstrating a tangible, permanent investment.","example":"If you contribute $50,000 worth of unencumbered vehicles and machinery that you already own to satisfy part of a $100,000 equity injection, the lender will require a recent, independent appraisal of that equipment to confirm its fair market value.","what_lenders_check":"Lenders prioritize accurate valuation of non-cash equity injections to prevent overstatement of the buyer's true investment. They ensure the appraisal is from a qualified, independent source and that the assets are free of liens.","required_facts":["Existing equipment","Fair market value","Independent appraisal","Unencumbered assets","Equity injection"],"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 a buyer's assumption of existing business debt count as part of the equity injection?","url":"https://dealroom.so/sba-7a/questions/can-a-buyer-s-assumption-of-existing-business-debt-count-as-part-of-the-equity-injection"},{"question":"How does the SBA verify the fair market value of assets contributed as equity injection?","url":"https://dealroom.so/sba-7a/questions/how-does-the-sba-verify-the-fair-market-value-of-assets-contributed-as-equity-injection"},{"question":"Can I use proceeds from selling personal real estate as an equity injection after closing?","url":"https://dealroom.so/sba-7a/questions/can-i-use-proceeds-from-selling-personal-real-estate-as-an-equity-injection-after-closing"}],"related_terms":[{"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"},{"term":"Equity injection verification","url":"https://dealroom.so/glossary/equity-injection-verification"},{"term":"For-profit business","url":"https://dealroom.so/glossary/for-profit-business"}],"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/how-is-existing-equipment-i-own-valued-for-my-equity-injection-into-the-acquired-business","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."]}