Glossary · Your money in the deal
Personal real estate
In short
This is property you own personally, like your home. Lenders often look to this as additional collateral if the business assets aren't enough to secure the SBA loan.
What it means in a deal
If the business assets don't fully cover the loan amount (a collateral gap), the SBA requires lenders to take available equity in personal real estate as additional collateral from all guarantors. This is typically a second mortgage on your primary residence or a first mortgage on investment properties. Be prepared for this requirement if the deal needs more collateral.
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 Personal real estate
- When is personal real estate typically required as additional collateral?
- Can funds from a personal line of credit secured by non-personal real estate be equity injection?
- Can I use proceeds from selling personal real estate as an equity injection after closing?
- When is personal real estate typically required as additional collateral for a 7(a) loan?
- Is personal real estate always required as collateral for a larger SBA 7(a) loan?
- Can personal real estate be required as collateral for a $200,000 7(a) loan?
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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