For SBA lenders
Short answer
To verify personal savings for an equity injection, lenders require recent bank statements (typically 3-6 months) showing the accumulation of funds, along with explanations for any large or unusual deposits.
The SBA requires lenders to verify the source of all equity injection funds to ensure they are unencumbered and truly from the borrower or an eligible third party. For personal savings, this means reviewing bank statements to confirm the funds have been held in the account for a reasonable period and are not recently borrowed. Any significant, recent deposits must be explained and documented to ensure they are not from ineligible sources (e.g., a credit card cash advance or a loan not on full standby).
A borrower claims $100,000 in personal savings for equity. The lender requests 6 months of bank statements. They observe a $50,000 deposit made 2 months prior. The lender then requires documentation (e.g., a sale agreement) proving these funds came from the sale of the borrower's personal vehicle.
Insider move
Lenders must prevent 'circular financing' or the use of ineligible funds for equity. Scrutinizing bank statements and requesting explanations for significant deposits protects against guaranty repairs arising from improper equity injection verification.
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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