The SBA 7(a) loan program is a loan program offered by the Small Business Administration (SBA). It is designed to help small businesses access capital for a variety of purposes, including acquiring a business. The SBA 7(a) loan program provides small businesses with access to long-term, fixed-rate financing that is partially guaranteed by the SBA. This means that if a small business defaults on the loan, the SBA will pay a portion of the remaining loan balance to the lender, reducing the lender's risk.
The SBA 7(a) loan program has flexible terms and is available to a wide variety of small businesses, including startups and existing businesses. The terms of the loan are determined by the lender, with the SBA setting certain limits on the interest rate, loan amount, and repayment period.
SBA 7(a) loans require a valuation when: the loan value is greater than $250K, there is a close relationship between the buyer and seller (for example, transactions between family members or business partners), or the lender’s internal policies require an independent appraisal. These appraisal most be performed by a valuation firm that is accredited by agencies like the AICPA or American Society of Appraisers.
Value Buddy is a trusted partner of various SBA lenders – we customize our valuation reports and methodologies to comply with the internal policies of the lending institution. Schedule a call today to learn more about our process and enterprise pricing.