EAC was awarded a Business Valuation contract by EquipNet for the purpose of SBA 7(a) Financing. Our report assisted EquipNet’s client, a franchise retail store, to validate an SBA financing deal. We calculated a fair market value by utilizing a blend of the income and market approaches.
‣ Industry: Service
‣ Standard of Value: Fair Market Value
What is a 7(a) Loan?
The 7(a) Loan Program is SBA’s primary program for helping start-up and existing small businesses, with financing guaranteed for a variety of general business purposes. SBA does not make loans itself, but rather guarantees loans made by participating lending institutions. In this way, taxpayer funds are only used in the event of borrower default. This reduces the risk to the lender but not to the borrower, who remains obligated for the full debt, even in the event of default