Glossary · Reading the business
Tangible net worth
In short
This is a measure of a business's net worth, excluding intangible assets like goodwill. Lenders use it to assess financial health, particularly for businesses seeking larger loans.
What it means in a deal
For larger SBA 7(a) loans (over $5 million), the SBA has a "tangible net worth" size standard in addition to employee and revenue standards. You need to ensure the target business, plus any affiliates, meets this if you're pursuing a larger deal.
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 net worth
- Can an SBA 7(a) loan be used to purchase a business with a negative tangible net worth?
- What is the maximum tangible net worth for a business to be considered 'small' under the alternative size standard?
- What is the specific personal net worth threshold that triggers a personal guaranty requirement for an owner?
- Can I use an SBA 7(a) loan to purchase a business with a negative net worth?
- Can an SBA 7(a) loan be used to purchase a business with a negative net worth?
- What if my business has a negative net worth? Can I still get an SBA 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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