{"ok":true,"canonical_url":"https://dealroom.so/glossary/conversion-right","api_url":"https://dealroom.so/api/public/glossary/conversion-right","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":"conversion-right","term":"Conversion right","group":"The loan itself","definition":"This is a loan feature allowing you to change the interest rate type, typically from variable to fixed, or vice versa, at specific points during the loan term. It offers flexibility against market changes.","what_it_means":"Some SBA 7(a) loans, particularly those with variable rates tied to WSJ Prime or SOFR, might include a conversion right. This lets you lock in a fixed rate if you anticipate rising interest rates or switch to variable if rates are expected to fall. Discuss this option with your lender during loan negotiation.","url":"https://dealroom.so/glossary/conversion-right","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"},{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"}],"related":[{"slug":"variable-rate","term":"Variable rate","url":"https://dealroom.so/glossary/variable-rate"},{"slug":"fixed-interest-rate","term":"Fixed interest rate","url":"https://dealroom.so/glossary/fixed-interest-rate"},{"slug":"wsj-prime","term":"WSJ Prime","url":"https://dealroom.so/glossary/wsj-prime"},{"slug":"sofr","term":"SOFR","url":"https://dealroom.so/glossary/sofr"}],"related_questions":[{"question":"What are the typical interest rates for an SBA 7(a) loan right now?","url":"https://dealroom.so/sba-loans/basics/what-are-the-typical-interest-rates-for-an-sba-7-a-loan-right-now"},{"question":"If I inherit funds right before closing, can they count towards my equity injection?","url":"https://dealroom.so/sba-7a/questions/if-i-inherit-funds-right-before-closing-can-they-count-towards-my-equity-injection"},{"question":"If I inherit $75,000 right before closing, can these funds count towards my equity injection?","url":"https://dealroom.so/sba-7a/questions/if-i-inherit-75-000-right-before-closing-can-these-funds-count-towards-my-equity-injection"},{"question":"What if I received a large inheritance right before applying; can those funds be used for the down payment?","url":"https://dealroom.so/sba-7a/questions/what-if-i-received-a-large-inheritance-right-before-applying-can-those-funds-be-used-for-t"},{"question":"Can an SBA 7(a) loan finance the purchase of intellectual property rights from a third party?","url":"https://dealroom.so/sba-7a/questions/can-an-sba-7-a-loan-finance-the-purchase-of-intellectual-property-rights-from-a-third-part"}]},"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 — Conversion right","url":"https://dealroom.so/glossary/conversion-right","source_type":"DealRoom Data"}}