{"ok":true,"canonical_url":"https://dealroom.so/glossary/interest-cost","api_url":"https://dealroom.so/api/public/glossary/interest-cost","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":"interest-cost","term":"Interest Cost","group":"Reading the business","definition":"The total amount of money paid by the borrower for the use of borrowed funds over the life of a loan. Buyer cares because it's a significant expense that impacts the business's profitability and cash flow.","what_it_means":"For an acquisition, you'll project the Interest Cost of your SBA 7(a) loan as a major operating expense. A variable rate loan means your Interest Cost can fluctuate, impacting your Cash Flow After Debt Service. Model different interest rate scenarios during due diligence to understand potential impacts.","url":"https://dealroom.so/glossary/interest-cost","official_sources":[],"related":[{"slug":"variable-rate","term":"Variable rate","url":"https://dealroom.so/glossary/variable-rate"},{"slug":"debt-service","term":"Debt service","url":"https://dealroom.so/glossary/debt-service"},{"slug":"cash-flow-after-debt-service","term":"Cash flow after debt service","url":"https://dealroom.so/glossary/cash-flow-after-debt-service"}],"related_questions":[{"question":"Can closing costs such as legal and accounting fees be included in the total project cost for the 10% calculation?","url":"https://dealroom.so/sba-7a/questions/can-closing-costs-such-as-legal-and-accounting-fees-be-included-in-the-total-project-cost-"},{"question":"What factors primarily influence the premium cost of business life insurance?","url":"https://dealroom.so/sba-7a/questions/what-factors-primarily-influence-the-premium-cost-of-business-life-insurance"},{"question":"Can an SBA 7(a) loan cover the cost of inventory for a business?","url":"https://dealroom.so/sba-loans/basics/can-an-sba-7-a-loan-cover-the-cost-of-inventory-for-a-business"},{"question":"Can an SBA 7(a) loan cover the cost of a business valuation or appraisal?","url":"https://dealroom.so/sba-7a/questions/can-an-sba-7-a-loan-cover-the-cost-of-a-business-valuation-or-appraisal"},{"question":"What percentage of the project cost does the SBA typically expect as a down payment?","url":"https://dealroom.so/sba-loans/basics/what-percentage-of-the-project-cost-does-the-sba-typically-expect-as-a-down-payment"},{"question":"What additional costs or fees, other than interest, are typically involved with an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/what-additional-costs-or-fees-other-than-interest-are-typically-involved-with-an-sba-7-a-l"}]},"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 — Interest Cost","url":"https://dealroom.so/glossary/interest-cost","source_type":"DealRoom Data"}}