For SBA lenders
Short answer
Proprietary software assets can be considered collateral for an SBA 7(a) loan, but their valuation requires specialized appraisal, and the lender must perfect a security interest through appropriate UCC filings.
While tangible assets are preferred, the SBA recognizes that some businesses have significant value in intangible assets. Proprietary software can be pledged as collateral if an independent, qualified appraiser determines its market value. The lender secures its interest via UCC filings on general intangibles.
A borrower acquires a software development company for $2,000,000, where $1,500,000 is attributed to proprietary software code. A qualified intangible asset appraiser values the software at $1,200,000. The lender obtains a first lien on this software through a UCC filing covering general intangibles, alongside other business assets.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
7(a) Loan Program — Terms, Conditions, and Eligibility
U.S. Small Business Administration · Official SBA source
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-13. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-13 · SBA sources checked through 2026-06-13. DealRoom analysis of public SBA 7(a) lending records (FY2020–present). Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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