{"ok":true,"canonical_url":"https://dealroom.so/glossary/federal-assignment-of-claims-act","api_url":"https://dealroom.so/api/public/glossary/federal-assignment-of-claims-act","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":"federal-assignment-of-claims-act","term":"Federal Assignment of Claims Act","aka":"FACA","group":"People and paperwork","definition":"This federal law dictates how payments from government contracts can be assigned to a third party, like a lender. It's critical for securing your SBA loan if government receivables are part of the collateral.","what_it_means":"If the business has government contracts, your lender will need to comply with FACA to take a security interest in those receivables. This means formal notification to the government contracting and disbursing officers. Without proper assignment, those receivables can't serve as collateral for your SBA loan.","url":"https://dealroom.so/glossary/federal-assignment-of-claims-act","official_sources":[],"related":[{"slug":"government-contracts","term":"Government contracts","url":"https://dealroom.so/glossary/government-contracts"},{"slug":"assignment-of-claims","term":"Assignment of claims","url":"https://dealroom.so/glossary/assignment-of-claims"},{"slug":"contracting-officer","term":"Contracting officer","url":"https://dealroom.so/glossary/contracting-officer"},{"slug":"disbursing-officer","term":"Disbursing officer","url":"https://dealroom.so/glossary/disbursing-officer"}],"related_questions":[{"question":"Can my personal savings account act as collateral for an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/can-my-personal-savings-account-act-as-collateral-for-an-sba-7-a-loan"},{"question":"How does a collateral assignment of life insurance protect a lender?","url":"https://dealroom.so/sba-7a/questions/how-does-a-collateral-assignment-of-life-insurance-protect-a-lender"},{"question":"What if the business I want to buy has pending litigation or unresolved legal claims?","url":"https://dealroom.so/sba-7a/questions/what-if-the-business-i-want-to-buy-has-pending-litigation-or-unresolved-legal-claims"},{"question":"When does the SBA typically mandate collateral assignment of life insurance for a business loan?","url":"https://dealroom.so/sba-7a/questions/when-does-the-sba-typically-mandate-collateral-assignment-of-life-insurance-for-a-business"},{"question":"How does a lender ensure proper collateral assignment of life insurance on multiple key principals?","url":"https://dealroom.so/for-lenders/questions/how-does-a-lender-ensure-proper-collateral-assignment-of-life-insurance-on-multiple-key-pr"},{"question":"When is collateral assignment of life insurance required for principals on an SBA 7(a) loan?","url":"https://dealroom.so/for-lenders/questions/when-is-collateral-assignment-of-life-insurance-required-for-principals-on-an-sba-7-a-loan"}]},"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 — Federal Assignment of Claims Act","url":"https://dealroom.so/glossary/federal-assignment-of-claims-act","source_type":"DealRoom Data"}}