SBA 7(a) Q&A
Short answer
Yes, if you already own equipment that will be used in the acquired business, its independently appraised value can count towards your equity injection, provided it is unencumbered.
The SBA permits the contribution of unencumbered business-related assets as part of the borrower's equity injection. An independent appraisal is required to establish the fair market value of the equipment. If the equipment is encumbered, only the equity above the lien amount may count.
You are acquiring a business and need $100,000 in equity. You contribute $50,000 in cash and existing machinery you own, which an independent appraiser values at $50,000. This $50,000 equipment value can fulfill the remainder of your equity requirement.
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 2026-06-14. Official sources control — verify before relying on any rule for a live deal.
Last reviewed 2026-06-14 · SBA sources checked through 2026-06-14. 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 what counts toward the 10%
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