SBA 7(a) program loans – Understand the valuation requirements before applying
Abstract: The flagship of the SBA loan program — 7(a) guaranteed loans — was more popular than ever in 2014. Under the 7(a) program, the SBA guarantees a portion of the money that banks lend to small businesses. But approval requires significant red tape. For some transactions — including qualifying mergers, acquisitions and related-party transactions — lenders are required to request independent business valuations, which catches some small business owners off guard. This article answers some frequently asked questions about the SBA’s appraisal requirements.