Equipment Appraisal for an SBA 7(a) Loan: 3 Things
1:16 · published September 4, 2026 · Jared Lukes, CMEA
The three things that decide whether an equipment appraisal helps a 7(a) credit: the collateral advance rate and orderly liquidation value, a unit-by-unit schedule with serial numbers, and the effective date of value.
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On an SBA seven A loan, the equipment is often carried on the books at a number that has little to do with what it would bring in a sale. Three things decide whether the appraisal helps the credit.
One. The appraisal can move the advance rate. Used equipment can count at up to fifty percent of net book value, or up to eighty percent of orderly liquidation value where an appraisal supports it. On older machinery, that gap decides files.
Two. The schedule has to be unit by unit. A lump sum for machinery and equipment cannot be reconciled against the security agreement or traced to a lien filing. Serial numbers are what tie a valued asset to the collateral.
Three. The effective date is a decision. An appraisal is an opinion of value as of a date, and on a file that sits through a long underwriting cycle, that date becomes a question.
Lukes and Lukes performs machinery and equipment appraisals for SBA lenders nationwide. Independent inspection, USPAP compliant reporting. lukesappraisals.com.
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