Appraisal Requirements

Be Prepared

SBA 504 Appraisal Requirements

When Needed:

  • SBA Requires a real estate appraisal if the estimated value of the property is $500,000 or higher

Intended Users of the Appraisal:

  • You, the lender, may be identified as the client and U.S. Small Business Administration (SBA) must be an intended user.
  • Capital Matrix may also be identified as the client or an intended user.
  • SBA will not accept reliance letters in lieu of being named in the appraisal.

The appraiser must be:

  • Independent
  • State-Licensed or State-Certified. When the property's estimated value is over $1,000,000 the appraiser must be State-Certified.


  • Prepared in compliance with the Uniform Standards of Professional Appraisal Practice (USPAP)
  • Dated no more than 12 months prior to the SBA application
  • Must utilize at least two of the three approaches to value, including the sales approach
  • Must value to 95% of total project cost, otherwise additional equity injection is required
  • No restricted appraisals, must be a self-contained or summary report
  • Intangible assets will not be included in value
  • If equity in land is being contributed, appraisal is required if owned for 2 years or more, otherwise cost is used
  • Required to be submitted with the application if not an arms-length transaction