Glossary · Reading the business
Asset appraisal
In short
An independent valuation of specific tangible assets, like equipment or inventory, to determine their fair market value. Lenders use this to assess the collateral backing the loan.
What it means in a deal
For deals involving significant fixed assets, your lender will likely require an asset appraisal to confirm their value. This ensures the collateral is sufficient and helps determine the loan-to-value ratio. If the appraisal comes in low, it could impact the deal structure or require more equity.
Related terms
Common questions about Asset appraisal
- What is the difference between an asset and stock purchase in a buyout?
- Is an independent appraisal always required when an acquisition includes significant goodwill?
- How does a recent significant personal asset purchase affect my SBA 7(a) loan application?
- When is an independent appraisal required for non-real estate business assets being acquired?
- What if the business I'm buying has intellectual property (e.g., patents, trademarks) as its main asset?
- How does an SBA 7(a) loan address the financing of intellectual property as a major business asset?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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