SBA 7(a) Q&A
Short answer
A professional business valuation is critically important for an acquisition with an SBA 7(a) loan to justify the purchase price and ensure it's commercially reasonable.
The SBA requires a professional third-party business valuation for most acquisitions to ensure the purchase price is fair and reasonable. This valuation assesses the true market value of the business, including tangible and intangible assets (like goodwill), and helps determine the appropriate loan amount and collateral requirements.
For a $1,500,000 business acquisition, a valuation report from an accredited appraiser would confirm that the business's fair market value supports the purchase price, preventing the buyer from overpaying.
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.
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