{"ok":true,"canonical_url":"https://dealroom.so/sba-loans/basics/what-proof-do-i-need-to-show-for-the-source-of-my-down-payment-funds-for-an-sba-7-a-loan","api_url":"https://dealroom.so/api/public/questions/what-proof-do-i-need-to-show-for-the-source-of-my-down-payment-funds-for-an-sba-7-a-loan","question":"What proof do I need to show for the source of my down payment funds for an SBA 7(a) loan?","topic":"Down payment & equity injection","audience":"new","bot_mode":"buyer","short_answer":"The SBA requires lenders to verify the source of all funds used for your down payment (equity injection) to ensure they are from eligible, unencumbered sources and not borrowed or otherwise improperly obtained.","rule":"Lenders must obtain documentation, such as bank statements for a minimum of 90 days, to trace the source of equity injection funds. Funds must come from the borrower's verifiable personal resources and cannot be borrowed from another source or represent \"sweat equity\" or future services. Gifts are permissible but require specific documentation.","example":"If a borrower states they are contributing $50,000 from savings, the lender will require bank statements showing those funds held in the account for at least 90 days. If the funds recently appeared, the lender would require documentation of the source (e.g., sale of a personal asset, gift letter with donor's bank statements).","what_lenders_check":"Lenders are highly concerned about the legitimacy and source of equity injection funds. Failure to properly document and verify these funds can result in the SBA denying the guaranty in case of default, as it represents a fundamental eligibility issue.","required_facts":["Verify source","Unencumbered funds","Bank statements","90-day rule","Gift documentation"],"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-loans/basics/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-loans/basics/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-loans/basics/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-loans/basics/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-loans/basics/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-loans/basics/what-is-the-sba-s-minimum-required-equity-injection-percentage-for-a-business-acquisition"}],"related_terms":[{"term":"Proof of funds","url":"https://dealroom.so/glossary/proof-of-funds"},{"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":"Source and seasoning of funds","url":"https://dealroom.so/glossary/source-and-seasoning-of-funds"},{"term":"Demand for Payment","url":"https://dealroom.so/glossary/demand-for-payment"}],"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/sba-loans/basics/what-proof-do-i-need-to-show-for-the-source-of-my-down-payment-funds-for-an-sba-7-a-loan","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."]}