{"ok":true,"canonical_url":"https://dealroom.so/glossary/business-debt","api_url":"https://dealroom.so/api/public/glossary/business-debt","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":"business-debt","term":"Business debt","group":"Reading the business","definition":"This is any money the target business owes to lenders, vendors, or others. When acquiring a business, you need to understand what debt you'll inherit or what needs to be paid off at closing.","what_it_means":"As a buyer, you must identify all existing business debt during due diligence. In an asset purchase, most operational debt remains with the seller, but you need to ensure all liens are released. In a stock purchase, you typically assume all existing liabilities, including debt. Your lender will require all seller debt to be paid off or refinanced at closing, unless it's explicitly part of the deal structure.","url":"https://dealroom.so/glossary/business-debt","official_sources":[],"related":[{"slug":"due-diligence","term":"Due diligence","url":"https://dealroom.so/glossary/due-diligence"},{"slug":"asset-purchase","term":"Asset purchase","url":"https://dealroom.so/glossary/asset-purchase"},{"slug":"stock-purchase","term":"Stock purchase","url":"https://dealroom.so/glossary/stock-purchase"},{"slug":"liability","term":"Liability","url":"https://dealroom.so/glossary/liability"}],"related_questions":[{"question":"Can I use an SBA 7(a) loan for debt consolidation of existing business debts?","url":"https://dealroom.so/sba-loans/basics/can-i-use-an-sba-7-a-loan-for-debt-consolidation-of-existing-business-debts"},{"question":"Can I use an SBA 7(a) loan to refinance existing business debt?","url":"https://dealroom.so/sba-loans/basics/can-i-use-an-sba-7-a-loan-to-refinance-existing-business-debt"},{"question":"Can an SBA 7(a) loan be used to refinance existing business debt?","url":"https://dealroom.so/sba-loans/basics/can-an-sba-7-a-loan-be-used-to-refinance-existing-business-debt"},{"question":"Can a new business owner use an SBA 7(a) loan to refinance existing business debt?","url":"https://dealroom.so/sba-loans/basics/can-a-new-business-owner-use-an-sba-7-a-loan-to-refinance-existing-business-debt"},{"question":"What if the seller holds a significant portion of the acquired business's debt?","url":"https://dealroom.so/sba-7a/questions/what-if-the-seller-holds-a-significant-portion-of-the-acquired-business-s-debt"},{"question":"Can an SBA 7(a) loan be used to refinance high-interest business debt?","url":"https://dealroom.so/sba-loans/basics/can-an-sba-7-a-loan-be-used-to-refinance-high-interest-business-debt"}]},"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 — Business debt","url":"https://dealroom.so/glossary/business-debt","source_type":"DealRoom Data"}}