Glossary · Your money in the deal
Tangible Equity Injection
In short
This is the portion of your down payment that comes from verifiable cash or unencumbered assets, proving your commitment to the deal. The SBA requires a minimum tangible injection for most loans.
What it means in a deal
For an SBA 7(a) loan, at least 10% of the total project costs must be your tangible equity injection. This can be cash, or assets like a home equity line of credit (HELOC) or marketable securities. The SBA wants to see you have real skin in the game, not just borrowed funds.
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 Tangible Equity Injection
- What if the business I'm buying has limited tangible assets for collateral?
- What are the typical collateral requirements if the business has very few tangible assets?
- Can an SBA 7(a) loan be used to purchase a business with a negative tangible net worth?
- Can a 7(a) loan be secured by a lien on intellectual property alone if tangible assets are minimal?
- What is the maximum tangible net worth for a business to be considered 'small' under the alternative size standard?
- Can funds from a home equity line of credit be used for my 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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