{"ok":true,"canonical_url":"https://dealroom.so/sba-7a/questions/what-documentation-is-required-to-prove-the-source-of-my-equity-injection-funds","api_url":"https://dealroom.so/api/public/questions/what-documentation-is-required-to-prove-the-source-of-my-equity-injection-funds","question":"What documentation is required to prove the source of my equity injection funds?","topic":"Down payment & equity injection","audience":"borrower","bot_mode":"buyer","short_answer":"Lenders require clear documentation showing the source and availability of your equity injection funds, such as bank statements, investment account statements, or gift letters.","rule":"The SBA requires that the source of equity injection be verified and seasoned for a specific period to ensure the funds are genuinely from the borrower and not new debt with unknown terms. This prevents hidden liabilities and ensures the borrower's commitment.","example":"If a buyer states they have $100,000 for equity, the lender will ask for personal bank statements covering the past 3-6 months to confirm the funds' existence and source.","what_lenders_check":"Lenders scrutinize the source of funds to confirm they are not undisclosed loans, unseasoned assets, or from ineligible sources, which could jeopardize the SBA guaranty. They also check for consistency with the borrower's personal financial statement.","required_facts":["Source of funds","Fund seasoning","Bank statements","Gift letters","Personal financial statement"],"source_families":["SOP 50 10 - Lender and Development Company Loan Programs","13 CFR Part 120 - Business Loans","SBA Form 1919 - Borrower Information Form"],"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":"SBA Form 1919 - Borrower Information Form","url":"https://www.sba.gov/sites/default/files/2025-03/2025.02.27%20Form%201919%20-%20Updates%20%28FINAL%29_03-12-2025%20%281%29.pdf"}],"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":"Down payment","url":"https://dealroom.so/glossary/down-payment"},{"term":"Source of funds","url":"https://dealroom.so/glossary/source-of-funds"},{"term":"Source-of-Funds Verification","url":"https://dealroom.so/glossary/source-of-funds-verification"},{"term":"Equity injection","url":"https://dealroom.so/glossary/equity-injection"},{"term":"Source and seasoning of funds","url":"https://dealroom.so/glossary/source-and-seasoning-of-funds"},{"term":"Minimum Equity Injection","url":"https://dealroom.so/glossary/minimum-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":"2026-06-14","sba_rule_sources_checked_through":"2026-06-14"},"citation":{"label":"DealRoom.so SBA 7(a) Q&A","url":"https://dealroom.so/sba-7a/questions/what-documentation-is-required-to-prove-the-source-of-my-equity-injection-funds","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."]}