SBA 7(a) Q&A
Short answer
A third-party, independent business valuation will be required to determine the fair market value of the business and the partner's share being acquired, regardless of internal agreements.
For a change of ownership, including a partner buyout, the SBA requires a professional, independent valuation of the business. This valuation ensures the purchase price is justified and the loan amount is reasonable based on the business's actual value, rather than an arbitrary internal agreement.
Even if you and your partner agreed on a $500,000 valuation, the lender will commission a qualified appraiser to determine the fair market value. If the appraisal comes in lower, the loan amount will be based on that lower figure.
Lenders rely on independent valuations to justify the loan amount and mitigate risk, especially in partner buyouts where conflicts of interest or inflated values can arise. They ensure the appraiser is qualified and disinterested.
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.
Terms in this answer
Pre-qualify your SBA 7(a) deal
Tell us the business, the price, and where you are — we'll point you to the lenders most likely to fund a deal like yours and flag anything that trips up approval.
Free · No documents · Usually same-day