SBA 7(a) Q&A
Short answer
Yes, a partner can contribute assets instead of cash for their portion of the equity injection, provided the assets are eligible and properly valued.
Each owner's contribution to the equity injection can be in the form of cash, unencumbered personal assets, or unencumbered business assets, subject to proper valuation. The total equity injection from all owners must meet the SBA's minimum requirements (typically 10% for acquisitions). The lender must verify the value and unencumbered status of any asset contribution.
Two partners are acquiring a $1,000,000 business requiring a $100,000 equity injection. Partner A contributes $50,000 cash. Partner B contributes $50,000 worth of specialized equipment (unencumbered and independently appraised) to meet their share of the injection.
Insider move
The lender will verify that the assets contributed by the partner are unencumbered, independently valued (e.g., by appraisal), and essential to the business. They ensure all partners' contributions collectively meet the required minimum.
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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