Glossary · Reading the business
Independent third-party appraisal
In short
A valuation by an unbiased expert of the business or its assets. Lenders require this to ensure the purchase price is fair and the collateral value is sufficient for the loan.
What it means in a deal
For 7(a) loans, an appraisal is typically required for real estate, business valuations over $250,000, or specific equipment. You need to understand its findings, as a low appraisal can impact loan approval or require you to adjust your offer.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Independent third-party appraisal
- Can a third-party loan, not from the seller, count towards the minimum equity injection?
- What specific language must a non-SBA third-party standby agreement include to ensure eligibility?
- How does a lender verify the full standby status of a non-SBA third-party debt?
- Is an independent appraisal always required when an acquisition includes significant goodwill?
- Can an SBA 7(a) loan finance the purchase of intellectual property rights from a third party?
- What are the eligibility requirements for funds borrowed from a third party to count as equity injection?
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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