For SBA lenders
Short answer
A business valuation from an independent, qualified source is typically required for change-of-ownership loans where the total loan amount, including any business real estate, exceeds $500,000.
For acquisition loans over $500,000, the SBA requires an independent business valuation to ensure the purchase price is reasonable and supported by the business's fair market value. This protects both the borrower from overpaying and the SBA from guaranteeing an over-leveraged asset.
A buyer is acquiring a business for $600,000, including $100,000 in real estate, financed by a $540,000 SBA 7(a) loan. An independent business valuation is mandatory due to the loan amount exceeding $500,000.
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.
More on change-of-ownership underwriting
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