{"ok":true,"canonical_url":"https://dealroom.so/glossary/borrower-default","api_url":"https://dealroom.so/api/public/glossary/borrower-default","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"borrower-default","term":"Borrower default","group":"The loan itself","definition":"This occurs when a borrower fails to meet the terms of their loan agreement, most commonly by missing payments. It can trigger serious consequences, including foreclosure or liquidation.","what_it_means":"If you default on your SBA loan, the lender will first try to work with you, but ultimately they can call the loan due and begin collection efforts, including seizing collateral and enforcing personal guarantees. Understand your loan agreement's default clauses and repayment schedule to avoid this.","url":"https://dealroom.so/glossary/borrower-default","official_sources":[{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"}],"related":[{"slug":"loan-default","term":"Loan default","url":"https://dealroom.so/glossary/loan-default"},{"slug":"personal-guarantee","term":"Personal guarantee","url":"https://dealroom.so/glossary/personal-guarantee"},{"slug":"collateral","term":"Collateral","url":"https://dealroom.so/glossary/collateral"},{"slug":"liquidation","term":"Liquidation","url":"https://dealroom.so/glossary/liquidation"}],"related_questions":[{"question":"How does a borrower's prior federal debt delinquency or default (e.g., tax lien) impact their 7(a) loan eligibility?","url":"https://dealroom.so/for-lenders/questions/how-does-a-borrower-s-prior-federal-debt-delinquency-or-default-e-g-tax-lien-impact-their-"},{"question":"What documentation must a lender provide to the SBA to support a request for a guaranty purchase due to borrower default?","url":"https://dealroom.so/for-lenders/questions/what-documentation-must-a-lender-provide-to-the-sba-to-support-a-request-for-a-guaranty-pu"},{"question":"If my business defaults, does the SBA guarantee protect me as the borrower?","url":"https://dealroom.so/sba-loans/basics/if-my-business-defaults-does-the-sba-guarantee-protect-me-as-the-borrower"},{"question":"What happens if I default on an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/what-happens-if-i-default-on-an-sba-7-a-loan"},{"question":"How does a lender request an SBA guaranty purchase after loan default?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-request-an-sba-guaranty-purchase-after-loan-default"},{"question":"What constitutes 'prudent liquidation' for a 7(a) loan to protect the SBA guaranty during default?","url":"https://dealroom.so/for-lenders/questions/what-constitutes-prudent-liquidation-for-a-7-a-loan-to-protect-the-sba-guaranty-during-def"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Borrower default","url":"https://dealroom.so/glossary/borrower-default","source_type":"DealRoom Data"}}