Glossary · Reading the business
In short
A professional valuation of the business performed by an unbiased third party. Lenders require this to ensure the purchase price is fair and the collateral covers the loan amount.
For an SBA 7(a) loan, an independent appraisal is mandatory for any business sale exceeding $250,000. The appraiser will assess the fair market value of the business, its assets, and sometimes real estate. You need to review this appraisal to ensure it aligns with your understanding of the business's value and supports the purchase price.
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
Pressure-test the numbers before you make an offer
Send us the asking price and the seller's cash flow — we'll show whether the deal services SBA debt and where the add-backs are likely to hold up.
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