Glossary · Reading the business
Market comparables(Comps)
In short
These are recent sales data for similar businesses or properties in the same industry or geographic area. They help determine a fair market value for the business you're buying.
What it means in a deal
Appraisers and lenders use market comparables (or "comps") to cross-reference the proposed purchase price and ensure it aligns with recent transactions. If your deal's price is significantly higher than comps, you'll need a strong justification. This impacts the business valuation and loan approval.
Related terms
Common questions about Market comparables
- What are the requirements for assigning secondary market loans through SBA Form 1088?
- How does a lender determine the fair market value of business equipment used as collateral?
- How does the SBA verify the fair market value of assets contributed as equity injection?
- How does a lender evaluate the market value of collateral when there are limited comparable sales?
- If a borrower contributes equipment as equity, how does the lender verify its fair market value?
- How does the SBA evaluate the fair market value of goodwill in a business acquisition for financing?
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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