For SBA lenders
Short answer
The fair market value of an existing personal vehicle can be considered non-cash equity injection if it is essential for the business operations and properly valued by an independent appraisal.
Non-cash equity injections are generally permissible if the asset is essential to the business and its value is properly substantiated. For vehicles, this requires an independent valuation (e.g., NADA guide, appraisal) to establish fair market value, and the vehicle must be transferred to the business for its exclusive use.
A borrower acquiring a plumbing business plans to contribute their personal work van, valued at $30,000, as part of the equity injection. The lender obtains a NADA guide valuation confirming the value and ensures the van is titled to the new business entity at closing.
Insider move
Lenders must ensure the vehicle is truly essential for the business, its valuation is defensible, and it is properly transferred to the business entity with a recorded lien. Overvaluation or non-essential assets are significant concerns.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
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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