What the Third-Party Reports Cost on an SBA or USDA Loan in 2026, and How to Read the Fee Against the Loan

• 

  What third-party reports cost on a small business loan

A $9,000 feasibility study is 600 basis points of a $150,000 loan and 26 basis points of a $3.5 million one. Same report, same work, same page count. The reason sponsors argue about third-party fees and lenders rarely do is that the two are looking at different denominators. This is what each of the eight reports on an SBA or USDA file costs in 2026, what drives the range, who is permitted to prepare each, whether it can be financed, and where the whole stack lands against the loan it supports.

Start With the Denominator

The SBA 7(a) programme approved 204,022 loans between fiscal 2023 and the first half of fiscal 2026. The average was $480,521. The median was $150,000.

That gap between average and median is the whole story of third-party report economics, and it is worth seeing in full.

Loan size	Share of loans	Share of dollars
$150,000 or less	50.4 percent	7.5 percent
$150,001 to $350,000	18.7 percent	10.1 percent
$350,001 to $700,000	13.4 percent	14.0 percent
$700,001 to $1 million	5.4 percent	9.6 percent
$1 million to $2 million	6.5 percent	19.8 percent
$2 million to $3 million	2.6 percent	13.6 percent
$3 million to $5 million	2.9 percent	25.4 percent

Source: Loan Analytics computation from the SBA 7(a) loan-level FOIA file, March 2026 release, net of cancellations.

Half of all SBA loans are $150,000 or less and they carry 7.5 percent of the dollars. Under six percent of loans are above $2 million and they carry 39 percent of the dollars. A report stack that is trivially affordable on the second group is prohibitive on the first, which is why the same fee schedule produces furious objections from one sponsor and indifference from another.

Acquisitions sit differently again. The median change-of-ownership loan over the same period was $677,350 and the mean $1,139,038, so the acquisition market is concentrated in the band where third-party reports are meaningful but not overwhelming.

The Eight Reports, Ranked by Cost

Ranked from cheapest to most expensive at their typical midpoints, for 2026.

1. Franchise review. Usually nothing. The SBA Franchise Directory is free and publicly accessible. Where a brand is listed, the lender relies on the listing and there is no standalone report fee. Where a brand is not listed, or the agreement has been amended, the lender or its counsel must review the agreement against the FTC franchise definition, and the cost is review time rather than a fixed report.

2. Phase I environmental site assessment. Roughly $1,800 to $6,000 for most commercial properties, with published ranges from consultants clustering around $2,500 and rising toward $5,000 on larger or more complex sites. Turnaround is typically two to four weeks, faster on a rush at added cost. No laboratory testing is included, which is the reason the next item exists.

3. Business valuation by an accredited appraiser. Roughly $1,500 to $5,000 for a standard SBA-compliant valuation, with quoted midpoints around $2,500 to $3,000 and more complex acquisition work reaching $7,000. Turnaround runs about eight to ten business days.

4. Standard commercial real estate appraisal. Roughly $2,000 to $6,000 for a straightforward commercial property, with assignments by an MAI-designated appraiser commonly running $4,000 to $10,000. SBA's own pass-through guidance spans $3,000 to $25,000 across the range from simple to complex. Turnaround two to four weeks.

5. Independent feasibility study. For SBA purposes, roughly $5,000 to $20,000 depending on asset class and scope. For USDA, roughly $10,000 to $50,000, because the five-component structure the regulation requires produces a longer document. Simple renewable energy studies sit near the bottom of the USDA range; large processing and food hub projects at the top. SBA turnaround commonly seven to sixteen business days; USDA four to twelve weeks.

6. Going-concern appraisal on special purpose property. Roughly $3,000 to $30,000 and up. There is no published fee survey for this report, and the spread is wide because the assignment varies enormously: a car wash going-concern appraisal is a different exercise from a hotel with three years of operating statements, which commonly runs $15,000 to $30,000. Turnaround is longer than a standard appraisal, roughly four to six weeks on a hotel.

7. Quality of Earnings report. Roughly $8,900 at the bottom of the specialist market to $50,000 and beyond, with the clearest bands being $15,000 to $25,000 below $3 million of EBITDA, $25,000 to $50,000 from $3 million to $10 million, and above that for larger deals. Specialist providers serving the SBA market have published fixed-fee products in the $12,000 to $23,000 range with two to four week turnarounds. General turnaround runs four to eight weeks.

8. Phase II environmental site assessment. Only triggered where the Phase I identifies a recognised environmental condition, and then anywhere from $5,000 to $100,000 and beyond. Most standard commercial Phase II work runs $8,000 to $15,000; contaminated or large sites run $25,000 to $100,000. Sampling and laboratory fees are 40 to 50 percent of the cost.

Separately, construction plan and cost review and progress inspections. A plan and cost review verifies the construction budget, schedule, plans and contract before closing, and is distinct from a feasibility study, which tests whether the project works economically. These are quote-only; most firms publish no fixed fee. Draw inspections run roughly $300 to $800 a visit on smaller projects and $1,000 to $2,500 on complex commercial work, with reports typically in five to fifteen business days.

Who Is Permitted to Prepare Each

The credential rules are stricter than most sponsors expect, and they differ sharply from report to report. This is where engagements go wrong.

Business valuation. Must come from a Qualified Source, defined as an individual who regularly receives compensation for business valuations and holds one of five accreditations: ASA, ABV, CVA, CBA or BCA. The appraiser is engaged by the lender, not the borrower, and must have no financial interest in the outcome.

One change worth noting for anyone budgeting a small acquisition. Under SOP 50 10 8, where the amount financed less the appraised value of real estate and equipment was $250,000 or less on an arm's-length deal, the lender could perform its own internal valuation. SOP 50 10 8.1 removes that tier. From 1 October an independent Qualified Source valuation is required on every change of ownership, which places a new $1,500 to $5,000 cost on exactly the small deals that previously escaped it.

Going-concern appraisal. A Certified General Real Property Appraiser who has completed no fewer than four going-concern appraisals of equivalent special use property within the last 36 months, stated in the qualifications section of the report. A full USPAP Appraisal Report; SBA does not accept Restricted Appraisal Reports. Note the word equivalent. A designation alone does not qualify an appraiser for this work.

Commercial real estate appraisal. State-licensed or state-certified, USPAP compliant, and state-certified where estimated value exceeds $1,000,000. Ordered by the lender. Borrowers, brokers and mortgage brokers may not order it. On construction the appraisal is at completion value, and after completion the lender must obtain a deviation statement confirming the building matches the plans.

Phase I and Phase II. A qualified Environmental Professional as defined under the current ASTM practice and the EPA all appropriate inquiries rule.

Feasibility study. SBA names no credential. The study is discretionary under the regulations, and where a lender requires one SBA expects an independent third party. USDA is stricter and more specific: 7 CFR Part 5001 defines the feasibility study as a report by an independent qualified consultant evaluating economic, market, technical, financial and management feasibility, the consultant must be acceptable to the Agency and have no financial interest in the outcome, and the regulation states expressly that the income approach of an appraisal is not an acceptable feasibility study.

Quality of Earnings. Here is the anomaly. The SOP requires the report to be commissioned by and prepared for the lender, and a report prepared by or for the borrower or seller does not satisfy it. But it names no credential at all. No CPA requirement, no accreditation. That is a striking contrast with the business valuation, where five specific designations are enumerated.

The consequence is practical rather than theoretical. On the valuation, the credential is the quality control. On the Quality of Earnings, the engagement letter is the quality control, because there is nothing else. Specify the cash proof period, the add-back documentation threshold, the concentration analysis and the form of the reliance letter, and state that a recast of the seller's own add-backs does not satisfy the scope.

What Can Be Financed, and What Counts Toward Equity

Nearly all of these costs can be financed into the loan and counted within total project cost, which is the base against which the equity injection is calculated. That matters more than the headline fee, because a report financed into the loan is a soft cost in the project rather than cash out of the sponsor's pocket at a moment when cash is scarce.

Two specifics worth knowing. Out-of-pocket valuation and Quality of Earnings costs count toward the borrower's equity injection. And on the USDA side, the study is a project expense bundled into the sources and uses on a ground-up deal.

The rules on what the lender may charge are tighter than the rules on what the borrower may finance.

SBA prohibits origination fees and points. Lenders may charge a reasonable and customary packaging fee, and may pass through actual third-party costs at cost. No markup. Fees may be charged only for services actually rendered, not for anticipated work. Where the lender itself employs an agent to perform approved services, that expense cannot be passed to the applicant. An extraordinary servicing fee is permitted for construction or receivables monitoring.

Form 159 is the disclosure mechanism, and it catches more parties than sponsors assume. It discloses fees paid to Agents, meaning loan packagers, referral agents, brokers, consultants and accountants preparing financial statements specifically for the loan application. A separate form is required for each agent, signed by lender, applicant and agent. Where aggregate compensation from the same agent exceeds $2,500, an itemisation of work performed, hours and hourly rate must be attached. Lender packaging fees up to $2,500 need not be disclosed.

Excluded from the definition of Agent, and therefore from Form 159: closing attorneys, the applicant's own accountant performing usual services, real estate agents earning a sale commission, and an environmental professional or business valuation professional engaged by the lender. The two-master rule bars an agent from being paid by both borrower and lender for the same service, and the lender must tell the applicant in writing that it is not required to employ an agent.

What the Stack Actually Costs, by Deal Type

Three representative builds.

A plain owner-occupied commercial real estate 7(a). Commercial appraisal $2,000 to $6,000, Phase I $2,000 to $5,000, franchise directory check nothing. Total roughly $5,000 to $12,000.

A business acquisition without real estate, below $3 million. Business valuation $1,500 to $5,000, and from October that valuation is required regardless of size. Add a Phase I only where the target occupies property with environmental exposure. Total commonly $2,000 to $8,000.

A special purpose acquisition or ground-up project. This is where the stack becomes material. Going-concern appraisal $10,000 to $30,000, feasibility study $5,000 to $50,000, construction monitoring where applicable, and, on an acquisition at $3 million or more of Business Purchase Price, a Quality of Earnings report at $15,000 to $50,000. A hotel acquisition at that threshold can carry $40,000 to $80,000 of third-party reports before legal and title.

Published deal-level evidence on the total is thin and mostly practitioner-quoted rather than survey-based. The commonly cited working figure for an SBA acquisition is $12,000 to $25,000 in third-party reports and closing costs, separate from the guaranty fee. Broader closing-cost guides put total SBA closing costs at 2 to 5 percent of loan amount, but that includes the guaranty fee, legal and title, not only third-party reports. Treat every share-of-loan percentage as an estimate.

The Fee in Basis Points

This is the calculation that ends most arguments about third-party cost, and almost nobody runs it.

A $9,000 feasibility study against a range of loan sizes:

Loan amount	$9,000 study, as basis points
$150,000	600 bp
$350,000	257 bp
$500,000	180 bp
$1,000,000	90 bp
$2,000,000	45 bp
$3,500,000	26 bp
$5,000,000	18 bp

And a $25,000 Quality of Earnings report, which only applies above a $3 million Business Purchase Price:

Loan amount	$25,000 report, as basis points
$3,000,000	83 bp
$4,000,000	63 bp
$5,000,000	50 bp

Two conclusions follow, and they point in opposite directions depending on where the deal sits.

On a small loan the report is genuinely expensive and should be scoped accordingly. At 600 basis points on a $150,000 loan, a full study is not proportionate, and a lender requiring one on a deal that size should expect to be asked why. The honest answer is usually that the file has a specific risk that the study addresses, and if it does not, the study should not be ordered.

On a larger loan the argument reverses entirely. At 26 basis points, the study costs less than a quarter of a point of rate on a loan that will run twenty-five years. A credit committee that will spend an hour arguing over a quarter point of pricing and then decline a $9,000 report on a $3.5 million special purpose acquisition has mispriced its own attention. The report is the cheapest risk mitigation in the file.

The FY2027 guaranty fee, for comparison, runs 3.5 percent of the guaranteed portion up to $1 million plus 3.75 percent above it, on loans from $700,001 to $5 million. On a $3.5 million loan at 75 percent guarantee that is roughly $99,000. The entire third-party report stack on the same deal is a fraction of the fee the borrower pays SBA for the guarantee.

The Sequence, and Where Money Gets Wasted

Order matters, and the wrong order is how sponsors pay twice.

On a site with existing fuel tanks or a prior industrial use, the Phase I comes first. A recognised environmental condition can make the loan unavailable at any price, and a feasibility study on a site that cannot clear its environmental file is an expensive way to discover the loan was never available. If the Phase I triggers a Phase II, the cost and the timeline both change materially, and the project budget has to absorb both before anything else is commissioned.

On an acquisition at or near $3 million, the real estate appraisal comes before the decision to commission the Quality of Earnings. Because Business Purchase Price is the contract price less the appraised value of owner-occupied real estate, the appraisal determines whether the report is required. Commissioning it before that figure exists risks paying for a report the file did not need.

On a ground-up project, the feasibility study comes before everything except site control. It is the report that determines whether there is a project to appraise. Ordering the appraisal, the environmental and the plan and cost review first, and then discovering the market does not support the project, wastes the whole stack.

And on any acquisition after 1 October, the Quality of Earnings is the critical path. At four to eight weeks it is the longest item, its earnings figure must be used in the coverage test, and a credit approval issued before it returns is conditional whether or not it says so.

Frequently Asked Questions

How much does an SBA feasibility study cost in 2026? Roughly $5,000 to $20,000 depending on asset class and scope, with turnaround commonly seven to sixteen business days. USDA studies run higher, roughly $10,000 to $50,000, because the regulation requires a five-component structure and a longer document.

Can third-party report costs be financed into the loan? Generally yes, and they count within total project cost, which is the base for the equity injection calculation. Out-of-pocket valuation and Quality of Earnings costs count toward the injection itself.

Can the lender mark up a third-party report? No. SBA requires pass-through at actual cost, prohibits origination fees and points, and permits only a reasonable and customary packaging fee, with agent compensation disclosed on Form 159 and itemised above $2,500.

Who pays for the reports? The borrower, through the loan. The lender orders and engages, which is a requirement rather than a courtesy: an appraisal, valuation or Quality of Earnings prepared for the borrower or seller does not satisfy the file.

Why is the going-concern appraisal so much more expensive than a standard commercial appraisal? Because it values an operating business as well as the real estate and must allocate between land, building, equipment and intangibles, and because the appraiser must hold four going-concern appraisals of equivalent special use property within the last 36 months, which is a small pool.

Does the new Quality of Earnings requirement apply to my deal? Only to Initial Acquisitions and Business Expansions where the Business Purchase Price, meaning the purchase price less the appraised value of owner-occupied commercial real estate, is $3 million or more, on applications receiving a loan number on or after 1 October 2026. Owner Buyouts and ESOP transactions are exempt at any size.

Is there a cheaper alternative to a full study on a small loan? Sometimes. A preliminary or scoped study addressing the specific question the lender has raised, rather than a full document, is often the right answer below a few hundred thousand dollars of loan. Ask the lender what it actually needs resolved before commissioning the full report.

Sources:

1. U.S. Small Business Administration, SOP 50 10 8, Lender and Development Company Loan Programs, effective 1 June 2025, third-party report, appraisal, valuation and fee provisions

2. U.S. Small Business Administration, Information Notice 5000-880695 and SOP 50 10 8.1, Appendix 15, effective 1 October 2026

3. U.S. Small Business Administration, Information Notice 5000-881797, 7(a) Fees Effective October 1, 2026 for Fiscal Year 2027, 3 September 2026

4. U.S. Small Business Administration, Form 159, Fee Disclosure and Compensation Agreement, and associated SOP provisions

5. U.S. Small Business Administration, 7(a) loan-level FOIA data file, March 2026 release; loan size distribution computed by Loan Analytics

6. 13 CFR 120.160, loan conditions

7. U.S. Department of Agriculture Rural Development, OneRD Guarantee rule, 7 CFR Part 5001, feasibility study definition and consultant independence requirements

8. ASTM International practice for Phase I environmental site assessments and the EPA all appropriate inquiries rule

9. Uniform Standards of Professional Appraisal Practice, appraisal report requirements

10. Published 2025 and 2026 fee ranges from environmental, valuation, appraisal and transaction advisory providers, compiled by Loan Analytics