SBA loan basics
Short answer
Typically, all available business assets are pledged as collateral, including real estate, equipment, inventory, and accounts receivable. If business assets are insufficient, personal assets of the owners may also be required.
The SBA requires lenders to take a lien on all available business assets, referred to as a 'blanket lien,' up to the loan amount. This includes both tangible assets (real estate, machinery) and intangible assets (trademarks, customer lists) that have value. If business assets do not provide sufficient collateral coverage, the lender must take available equity in personal assets of any owner with 20% or more ownership.
A bakery applying for a loan would offer its ovens, mixers, display cases, and any real estate it owns as business collateral. If these assets don't fully cover the loan, the owner might be required to pledge equity in their personal residence or other significant personal property.
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
SBA Form 1919 - Borrower Information Form
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 collateral requirements
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