SBA 7(a) Q&A
Short answer
Yes, for business acquisitions, an independent business valuation is almost always required to justify the purchase price, especially if goodwill is a component.
The SBA requires an independent valuation from a qualified third-party appraiser when the loan includes a change of ownership and the purchase price (or loan amount, depending on the rule) exceeds certain thresholds, typically $500,000. This ensures the business is being acquired at fair market value.
A buyer acquiring a business for $750,000 would need a professional business valuation report, even if the tangible assets are only $200,000, to justify the entire purchase price, including $550,000 of goodwill.
Insider move
Lenders carefully review the valuation report to ensure it is independent, performed by a qualified appraiser, and uses appropriate methodologies. They confirm the purchase price is supported by the valuation.
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 - Lender and Development Company Loan Programs
Last checked 2026-06-14. 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.
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